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Scottish independence: Draft paper suggests volatile oil revenues Scottish independence: SNP's Swinney admits to economic challenges
(about 2 hours later)
The BBC has obtained a leaked copy of a Scottish government discussion document on Scotland's financial position after independence. Scotland's finance secretary admitted there would be economic challenges in an independent Scotland but claimed it would be better placed to handle them.
The draft paper, written up to a year ago, said the volatility in projecting North Sea oil revenues creates uncertainty in financial planning. John Swinney was responding to the contents of a draft government discussion document on the country's financial position after independence.
It said an oil fund could increase stability but might mean a cut in public spending. The year-old paper said the volatility in projecting North Sea oil revenues created financial uncertainty.
The Scottish government said the paper had largely been overtaken by events. It said an oil fund could increase stability but might mean spending cuts.
The document appears to be a draft paper for the Scottish cabinet from Finance Secretary John Swinney. Mr Swinney said the challenges ahead were not unusual.
It sets out challenges, risks and opportunities that ministers believe Scotland would have in the event of a "yes" vote in the referendum. He explained: "There would be economic challenges as there would be in any constitutional situation.
"We are wrestling with economic and financial challenges today as part of the UK and most other countries are wrestling with these factors and of course an independent Scotland would have to operate sustainable public finances and invest in the economy.
"These issues would have to be managed by an independent Scotland and they would be managed much more effectively by an independent Scotland then the are by the UK."
North Sea oil
The Scottish government said the discussion paper had largely been overtaken by events.
It set out challenges, risks and opportunities that ministers believe Scotland would have in the event of a "yes" vote in the referendum.
It provides an insight into government thinking in the period following last spring's UK budget.It provides an insight into government thinking in the period following last spring's UK budget.
The paper recorded a high level of volatility in projected revenues from North Sea oil and said this creates considerable uncertainty in financial planning. The paper recorded a high level of volatility in projected revenues from North Sea oil and said this created considerable uncertainty in financial planning.
It pointed out that revenues could also be higher than expected and that independence would give Holyrood greater power to manage its money.It pointed out that revenues could also be higher than expected and that independence would give Holyrood greater power to manage its money.
Mr Swinney said: "Certainly in an independent Scotland, a larger proportion of its public finances would relate to the revenues coming from oil and gas, but not as much as Norway, for example."
The paper suggested accumulating cash in an oil fund would help provide stability but says this could lead to reduced public spending.The paper suggested accumulating cash in an oil fund would help provide stability but says this could lead to reduced public spending.
The Scottish government said the document was a first draft.
The SNP has said it would like to see an oil fund set up in the event of independence to provide a revenue stream for future generations of Scots.The SNP has said it would like to see an oil fund set up in the event of independence to provide a revenue stream for future generations of Scots.
On that issue, the finance minister said: "We would start to invest in an oil fund at a moment when we could see the opportunity within the management of the public finances - not a commitment I can give today."
He added that the Scottish government was engaging in a "dispassionate approach" to the way it was informing the people of Scotland about how an independence might be.