Scotland: For Richer or Poorer?

In just a couple of months,

Scotland will vote on whether to become an independent country.

This is a nation whose people are being asked

to make the most momentous decision in their history.

And in that decision money will matter.

We've got to look at the risk,

we've got to look at the reward and then make up our mind.

Now, this is one of the toughest questions

I think I've ever been asked in my life.

'I've been on an epic journey across Scotland,

'by air,

'sea

'and road.'

-Now I can't get the key out.

-HE LAUGHS

'But just how would Scotland's economy

'be affected by independence?'

Here we have it. A fresh batch of North Sea oil, still warm.

'What about the national debt?'

What would it cost them to borrow?

'And what currency would the new country use?'

This wonderful glittering thing is a unicorn.

'Central to the debate is a big and intriguing question.'

If Scotland were to vote for independence,

would it be richer or poorer than if it stays part of the United Kingdom?

'Big decisions often require head, heart and pocket.

'During the independence debate, money has taken centre stage,

'so I took to the streets of Paisley to carry out an experiment.'

This is 500 quid...

'Would the offer of being £500 a year better or worse off

'influence how people would vote?'

If you were persuaded that you would be 500 quid better off,

-would you vote for independence?

-Maybe, aye.

It's an extra £500 in your pocket. Who says no to £500?

No, I think it's immaterial whether you'd be worse off or better off.

-So, £500 wouldn't make any difference to the way you vote?

-No, absolutely not.

If it was 500 quid better off, would that be enough to make you vote yes?

Yes, aye, definitely.

So you might well vote for independence

-if you were absolutely sure you were going to be 500 quid better off?

-Yes.

-Well, you'd say 1,000, yes, but no' 500.

-Hm!

Money does come into it but...

I don't believe anything politicians say, so, you know...

They could tell you that you're going to be £3,000 richer

but, at the end of the day, are you? Probably not.

'My experiment's totally unscientific.

'But in 2013 the Scottish Social Attitudes Survey tested

'whether £500 was enough to shift people's voting intentions.'

Is that my money?

And it turned out it was.

That's why the campaign has been awash with claims and

counterclaims about how independence would make Scotland richer...

The power to compete, to grow businesses here in Scotland,

to attract headquarters, to ensure our best and brightest

can realise their ambitions in their own country

if they so choose - that is the economic prize of independence.

..or poorer?

You have 4 million people on the brink of a decision

that will affect their lives in a profound way.

The money in their pocket, the job they have,

the chances their children will have.

This is a major, life-changing decision.

And in recent weeks they've upped the ante, even making

a claim about the financial benefits of staying in the Union...

It's worth £1,400 for each person in Scotland each year

for the next 20 years.

..and the supposed independence dividend.

That amounts to £1,000 for every man, woman and child in the country,

or £2,000 for every Scottish family.

So what is the truth about these contradictory claims?

Well, where better to start

than in one of the richest cities in the UK? Aberdeen.

Today, I'm setting out to discover just how Scotland would fare

under independence.

Would it bring a bright new future...

..or the prospect of economic gloom?

Any investigation into Scotland's wealth can only start in one place.

The North Sea.

Its oil and the taxes it generates

have helped pay for the UK's public spending since the 1970s.

But the Scottish Nationalists have long claimed it's Scotland's oil.

Hello, Scottish National Party.

It's been central to their case for independence.

They believe if all the money had gone to Scotland

its recent past would be a different story.

But with North Sea oil now past its peak,

the big question today is, how much is left?

So here we have it, a fresh batch of North Sea oil, still warm,

extracted some three miles away

and three miles down and brought to this floating platform.

Now, we've already had 40 billion barrels' worth

of oil and gas from the North Sea

and although there are up to 24 billion barrels left to obtain,

what remains is much harder to extract,

and that's why the newer technologies

used by mobile floating platforms like this one

may represent the future.

As extracting oil gets trickier, the industry needs to get nimbler.

This is the Gryphon,

run by the Danish company Maersk 170 miles off the coast of Aberdeen.

Because it's a mobile platform it can be moved more easily

between fields to squeeze out the oil that's left.

In the past year it's produced 7 million barrels' worth of oil.

Now, a lot of people talk about the decline of the North Sea.

What kind of a future do you think it has?

We'll be producing gas and oil here for a number of decades to come.

The fields will be smaller and more marginal

but technology's allowing us to get after things

that we weren't able to get after in the past.

In the next two years, another 25 fields are coming on stream.

And just to be clear, for you, the North Sea is going to remain

a pretty big industry for a long time to come?

Yes, it's certainly going to be a focal point for a number of decades to come.

Apart from anything else,

North Sea oil has been a spectacular feat of British engineering

and for four decades all those reserves of the black gold

have helped to make us richer.

So, if Scotland were to go for independence,

the big question is, how much of its way of life

could continue to be paid for by the oil that's left?

Subject to negotiation, an independent Scotland may get

around a 90% share of the oil and gas out here.

And it would need it, because spending per head in Scotland

is higher than in the rest of the UK.

Paul Johnson is the head of the IFS,

the UK's top tax and spend number-crunchers.

I think it's important to be clear, Scotland is a rich economy,

it's on average about as rich as the rest of the UK.

On that basis, going forward into independence, it can clearly afford that.

It would need to make some real choices, though,

because at the moment it's spending quite a lot more than

the rest of the UK and it would need to make choices about

whether it's going to pay for that through higher taxes

or reduce some of that spending.

At the moment,

Scotland's public spending is relatively higher

than in the rest of the UK,

to the tune of about £1,200 extra per person each year.

In recent times that spending's been roughly balanced out

by North Sea oil revenues.

But in future, an ageing population

and declining oil revenues could combine to leave Scotland with

a significant gap between what it spends and what it takes in taxes.

The deficit in Scotland at the moment would just be a little bit worse

than the rest of the UK. Oil revenues have gone down recently,

they're projected to keep going down a bit, actually,

so over the next few years we'd expect the deficit to be a bit worse.

Over the long run, it gets worse still.

Any prediction, however, depends on oil revenues,

which are famously unpredictable.

The Treasury in London points to the fact that oil revenues

fell by a quarter last year alone, and it argues that future decline

would leave Scotland with a bigger deficit than the rest of the UK.

But the Scottish Government says that oil revenues are likely to only

decline gently and that in future Scotland's deficit will shrink.

So, the problem for the rest of us

is the sheer number of unknowns which lurk beneath the North Sea.

If you assume the price of oil goes up very fast,

then of course the revenues will increase.

But similarly, if you have to exploit more and more difficult fields

to get the oil out of, then the cost goes up and the revenues come down.

So all these things are unknown.

It's very difficult to speculate on what the future would be,

but the most likely thing is that oil revenues will gradually decline.

In Aberdeen earlier this year, a duel over oil.

David Cameron rode into town with his Cabinet in tow.

How was Cabinet this morning, First Minister?

Five miles down the road,

Alex Salmond held his own Cabinet in a church hall.

# This town ain't big enough for the both of us... #

Cameron headed for an oil rig to make his case

that staying in the union was the only way to cope

with the volatility of North Sea oil.

The broad shoulders of one of the top ten economies in the world

has really got behind this industry

and will continue to stay behind this industry

so we get the maximum benefit out of it -

the maximum benefit for all of the United Kingdom, including Scotland.

But Alex Salmond, who likes to remind us

he was an oil economist when David Cameron

was a schoolboy on the playing fields of Eton, had a riposte.

I can't really think of any countries in the world

who've discovered oil and gas

but many people in the population have got relatively poorer,

but that has been Scotland's fate under Westminster control.

I think it can be very different

and much better for the Scottish people with independence

and control of our own resources.

Now, those who believe in independence have got

a plan for how they can best manage those resources...

and help make Scotland richer.

They want to set up an oil wealth fund.

We think an oil wealth fund is very important.

It gives you this opportunity to take today's oil wealth

and not spend it today,

but to make it intergenerational and give your children

and your children's children some opportunity

to benefit in the economy for them also.

As it happens, there's a blueprint for the Scottish Government's plan.

To find out about it, I'm going on a journey

to the furthest-flung bit of Scotland - Shetland.

TRADITIONAL MUSIC PLAYS

This is no ordinary crossing.

This weekend sees the start of the Shetland Folk Festival...

..and there's not much sign of anyone getting any sleep

on the overnight ferry from Aberdeen.

# Well, you're dirty and sweet

# Clad in black, don't look back

# And I love you

# You're dirty and sweet Oh, yeah... #

Shetland did something very smart back in the 1970s.

When the giant oil companies came a-knocking,

asking if they could build terminals,

the islanders played tough.

They said yes to a single big terminal,

but only if the companies paid them a disturbance fee

every time they used it.

The oil companies had no choice but to cough up

and instead of simply spending the cash,

the Shetland Islanders put it into a trust.

Ann Black is the trust's chief executive.

Between 1975 and 2000, the Shetland Charitable Trust

received £81 million in compensation from the oil industry.

Then you invested that money. How much did it become worth?

The fund's worth 227 million, as of today.

It's split between 80% external investment -

so, that's mainly on the stock exchange -

bonds, properties, equities -

and 20% in local investments.

Now, what's smart about the Shetland fund is that they aim to only

spend the return, the income, on those investments

without touching the pot itself.

And so, while there's £227 million in the kitty,

they've already been able to spend more than that

for the benefit of the islanders.

This is just one of eight leisure centres

paid for by Shetland's oil fund, which has also financed a museum,

care homes for the elderly, and puts money into the local folk festival.

The lives of 20,000 Shetlanders,

enriched by a bit of forward-looking, canny financial planning.

Cash from oil and the clever way they invested it

has brought unprecedented prosperity to Shetland.

Unemployment here is less than half the UK average.

Yes, you do see the benefits of what they've done with the money.

There's an immense transformation compared with Shetland in the 1970s.

Initially, when I went there,

you had to scare the sheep off the runway before the plane could land.

The people here seem well set for the future, and I am too,

having been given the enormous honour

of opening their folk festival.

I am a not-very-secret folkie

and I understand this is the finest folk festival in the world,

-so it's a privilege for me...

-APPLAUSE

..a privilege for me to be here, an honour.

And, amazingly, it is my honour now

to declare this great festival commenced. Thank you.

# I saw stars

# I heard a birdie sing

# So sweet, so sweet

# The moment I fell for you... #

So, is this an exciting vision

of what Scotland could expect from independence?

# ..The moment I fell for you. #

The Yes campaign thinks it is, and they point not just to Shetland,

but to Norway, which set up an oil wealth fund in the 1990s.

It's now worth a staggering £500 billion

and owns an average 2.5% of every listed company in Europe.

So in two decades, Norway has used its resources to become

one of the most prosperous countries,

and indeed one of the fairest societies, in the world.

During the same period,

the United Kingdom has built up debts of £1.2 trillion sterling.

Alex Salmond likes to point out,

perhaps mischievously from time to time,

that there are only two oil-rich countries in the world

which lack a sovereign wealth fund

and they happen to be Iraq and the United Kingdom.

It's possible that if Margaret Thatcher had established

such a wealth fund here in the UK on the back of North Sea oil proceeds,

we'd be a bit richer today.

But the question right now is,

if Scotland established a wealth fund, would it be viable?

The British Government currently spends more than it earns,

and an independent Scotland would inevitably start life with

exactly the same problem.

But Alex Salmond believes an oil wealth fund would be

viable from the very beginning.

Any payment realistically in the first year would just be a start.

But my submission would be, great oaks from little acorns grow.

Yet some experts stress that would mean making hard choices

between today's financial needs and tomorrow's.

The issue for an independent Scotland is how credible it is

to build up a fund at a time when the overall budget

is in significant deficit.

In a sense, you can't count these revenues twice.

You can't both say, well,

they'll help us to deal with the fiscal deficit at the moment

AND we'll put them into a separate fund.

You have to think about them in one way or the other.

Now, everyone agrees that the oil revenues will eventually decline

so an absolutely vital question is

how Scotland will generate wealth elsewhere.

The battle lines have been drawn.

The Yes campaign believe independence will make

Scotland richer by enabling politicians to tailor policies

to suit Scotland's particular needs.

THEY CHEER

And some of Scotland's most entrepreneurial types agree.

Tony Banks runs a chain of care homes in the north-east of Scotland.

He employs more than 1,000 people.

I believe that Scotland will flourish under independence.

To me, as an entrepreneur, independence makes total sense -

to have control and be in charge of our own destinies

and to be able to shape the future, shape the policies

and shape the way the nation is going to turn out.

I see independence as the business opportunity of a lifetime.

The Yes campaign say that only an independent Scotland

would have the taxing and investing powers

needed to create a more dynamic economy.

I just see independence as a way of

lifting the whole nation's aspirations and ambitions

and lifting the wealth of the nation.

That should trickle right down to everybody in society.

But pitted against the Yes campaign

are some of British business's biggest beasts.

They believe that in a global economy, size and scale matter

and that independence could be bad for Scotland's prosperity.

Douglas Flint is a Scot based in London

as chairman of London's biggest bank, HSBC.

He's given his own money to the Better Together campaign

but he hasn't spoken about independence till now.

Scotland's a rich country, there's no doubt of that,

but I think it's richer as part of the United Kingdom.

I think, to some extent,

you're swapping the certainty

of 300-odd years of history for a vision of the future

which is well articulated

but is only a vision of the future and is uncertain.

How big a deal is this vote, not just for Scotland,

-but for the whole UK?

-I think it's huge.

I think the UK represents

one of the most successful unions ever in history -

economically, culturally, in every way -

and I think splitting it would be a tragedy.

The clash is fundamentally about the best way

for Scotland to generate wealth in the future.

But to understand where it's going,

you have to understand where its wealth came from in the past.

Scotland has a rich tradition of buccaneering entrepreneurs

who've set up successful businesses in Scotland and all over the world.

Perhaps the finest example of an outward-looking trading business

is the famous Johnnie Walker.

Johnnie and his son Alexander Walker

devised and developed a great idea.

They'd combine single malts to create a distinctive blend.

But their ambitions went way beyond that.

The Walkers did two ingenious things.

They persuaded Glasgow's sea captains to become

the company's sales agents all over the world

and they put the whisky into the distinctive square bottles

which meant that more of them could be packed into crates.

In this way, a Kilmarnock grocer became a world-beater.

Through the 20th century and into the 21st,

Johnnie Walker has conquered markets around the world.

-VOICE-OVER:

-'Thanks to the foresight

'of that Scottish grocer, John Walker,

'Scotch whisky has become the first choice

'of more people than any other party drink in the world.'

But somehow in the post-war years,

Scotland has failed to develop a new generation of Johnnie Walkers.

The rate at which it has created new business

has been markedly lower than in the rest of the UK.

Why did we manage to have such a good tradition of entrepreneurship

and, suddenly, something went wrong with it?

I think some of it was to do with many of the industries

we were involved in - shipbuilding, steel, those kinds of things -

were changing dramatically both in their technologies

and in where those things were done.

After the Second World War,

Scotland was powered by vast nationalised industries.

SHIP'S HORN BLARES

But their dominance may have stifled

the country's natural entrepreneurial flair.

And when heavy industry declined in the '60s and '70s,

with the loss of many thousands of jobs,

the private sector struggled to fill the void.

Nothing symbolised the struggles of Scotland's economy

40 and 50 years ago better than the Hillman Imp.

Today, it's a bit of a cult classic.

Back then, it was Scotland's gleaming future.

Oh, my goodness. The look, the smell - it brings it all back!

When I was what they would call here "a wee bairn",

this marvellous vehicle, the slightly eccentric Hillman Imp,

was more or less everywhere.

What I didn't know is that it was the only mass-production car

that was made here in Scotland and, as such,

it's a poignant reminder of the decline of heavy industry

and how successive governments have struggled

to re-engineer the Scottish economy.

To begin with, the Hillman Imp was a symbol of hope for Scotland.

-VOICE-OVER:

-'And in this restless time,

'the moment has come for Scotland to begin afresh

'in the greatest light industry of all - the making of motorcars.'

In the early 1960s,

the Government in Westminster put pressure on the Rootes car firm

to build a vast new factory to produce the Imp in Linwood,

just outside Glasgow.

The idea was that the plant would provide employment for workers

who were losing their jobs in other heavy industries.

-VOICEOVER:

-'Ideas and skill and steel and aluminium and raw shapes

'have evolved into a new thing - a machine with the power of motion.'

But the economics of the plant were doomed.

It was hundreds of miles

from the components factories in the Midlands and, in 1981,

it shut with the loss of just under 5,000 jobs.

# ..Will you send back a letter from America? #

Linwood's end, along with many other factory closures,

inspired the Proclaimers' most famous anthem - Letter From America.

# ..Bathgate no more

# Linwood no more

# Methil no more

# Irvine no more... #

The Hillman Imp now stands as a symbol

of what went wrong with Scotland's economy.

As heavy industries closed, the country struggled to replace them.

Scotland's economic past has been one of nationalised industries,

but what's happened since the '60s is we have gone from a culture

where someone else took care of you - i.e., the Government -

and a job for life when I was at school,

go down the pit, a job for life -

to being, "No, there's no more of that."

And therefore it's been a difficult transition

to actually looking after ourselves once again.

But today, it's by no means all gloom.

Few places illustrate better how Scotland is trying to

make that transition from old industries to new than Dundee.

This place was once famous for its jute,

jam

and journalism.

And famously, it's the home of the Beano.

And Desperate Dan.

Desperate Dan, one of my all-time favourites.

Great to be meeting him in the flesh at last.

Like most of Scotland, by the 1980s

many of Dundee's traditional industries were in steep decline.

Yet it would find a perhaps unlikely saviour.

God, I feel nostalgic holding this wonderful bit of kit -

the Sinclair ZX Spectrum.

Now, back in the 1980s, almost every British home wanted one of these,

and they were made here in Dundee in the local Timex factory.

We have you build these computers for us not because we have any

particular links with Dundee, not because we have to have computers

built in Britain - we can have them built anywhere in the world.

We have our computers built by you here in Dundee

because you're the best people, as far as we're aware, to build them.

And I'd like to thank you very much on behalf of Sinclair Research.

That factory may have gone,

the Sinclair ZX may now be in museums,

but it spawned a generation of entrepreneurial computer game developers right here.

Chris van der Kuyl was one of those enterprising 1980s geeks.

Here in Dundee, we manufactured the console,

so everywhere else in the UK, it cost something like £149.

Here in Dundee, if you knew the right person, it's considerably less.

So, what did kids here have to pay for a ZX?

Allegedly, and I couldn't possibly confirm this,

it was about £10 and a packet of Embassy Regal in the right pub.

I personally had six of them.

Those cut-price computers did Dundee a huge favour.

Today the city has about 300 people working in computer games.

It was Dundee that spawned the hit -

some would say notorious - computer game, Grand Theft Auto.

# Sweet dreams are made of these... #

Many of those who work in the industry here

are graduates from one of Dundee's universities...

Abertay.

It was the first in the world

to run a degree in computer gaming design

and has helped to drive the city's renewed success.

Today, Chris van der Kuyl

develops the PlayStation and Xbox versions

of the massively successful game Minecraft.

He's even created a computer version

of what Dundee's waterfront would look like

when the new Victoria & Albert Museum opens here in 2017.

He's been a player in developing

Dundee's very own, if small, Silicon Valley.

Given the choice between sunny California

and not always sunny Dundee,

you chose Dundee. Why?

I saw something unique in Scotland

when it comes to digital media and technology.

I saw that we have fantastic engineering and mathematical talent

but also combined with creative talent

that I've almost never seen replicated anywhere else.

Those things coming together in the right way

create something quite special.

Dundee has another great strength - drug research and life sciences.

The University of Dundee is one of the UK's leading centres

in medical and pharmaceutical research.

Sir Philip Cohen is the eminent scientist who's played

an important role in that success.

Life sciences in Scotland is very well respected internationally.

In fact, in recent surveys,

Scotland actually ranked number one in the world -

well ahead of England

and actually even further ahead of the United States.

I'm now told that the life sciences and biotech industry in Dundee

is something like 16% of the local economy.

And of course these are very well-paid, hi-tech jobs.

Just the sort of jobs that the town needs.

Sir Philip Cohen and more than

a dozen other distinguished scientists

have put on the record their worries about the impact of independence

on a discipline and an industry in which Scotland excels.

Would life sciences and medicine

be better off if Scotland was independent?

I think there are very considerable risks for funding.

If we're not eligible for

funding from research councils in the United Kingdom

and just have to use the small pot of money devolved to Scotland,

I think this will be so risky.

I think it would be dangerous for Scotland to go it alone,

at least as concerns life sciences.

Dundee may not be booming,

but its large and respected universities,

its thriving computer games

and life sciences businesses give a clue perhaps

to what the economy of

an independent Scotland might look like.

That said, the challenge faced by Dundee

is in fact the challenge faced by much of the UK,

which is how to turn imaginative ideas, intellectual property

not just into successful local businesses but into world-beaters.

So modern Scotland is developing new,

more hi-tech industries to replace the ones it's lost.

Alex Salmond uses them as examples of

how and why Scotland can flourish as an independent nation.

More top universities per head than any other country,

a hotbed of life sciences, brilliance in creative industries.

We will not let anyone tell the people of Scotland

that we're not good enough to run our own country.

But David Cameron counters that

they would enjoy greater success as part of the UK.

We are better off, Scotland's better off if we stick together.

We have so many brilliant tech companies in Scotland,

from video games makers in Dundee to web developers here in Edinburgh,

and we in the UK are pulling every lever possible to help them.

'There's another important ingredient

'for a really successful economy.

'Everyone agrees that Scotland

'needs to rediscover its entrepreneurial zeal.'

Yes, this is for people who want to start a business, grow a business.

-Yes.

-Because when you're starting...

'Sir Tom Hunter is one of Scotland's richest men.

'He built up a retail empire from scratch and he's given

'millions of pounds of his own money

'and office space to encourage business start-ups.

'He's not saying which way he'll vote on independence,

'but what matters to him

'is that Scotland finds again its trading instincts.'

There's still a stigma around failure, especially in Scotland.

It's almost if you've tried and you've failed,

you should never try again,

um, which I'm so against.

They embrace failure in the States

because they see it as just another learning point.

That's such a positive message for the young entrepreneurs in Scotland

because fear of failure is holding us back.

Sir Tom believes that after years of failing to create the business

the country needs, Scotland might just be starting to turn the corner.

I think we are really beginning to get our act together,

but we're at the beginning.

If you're a young or even an old entrepreneur and want to start

and grow a business in Scotland,

I think now there's never been a better time.

So I think we're getting better but there's a long way to go.

Now the Yes campaign

believes independence will make Scotland richer.

But there's a big unknown about their vision,

which has provoked fierce debate

and which could make Scotland poorer, at least in the short term.

And that's perhaps best explored here,

in the magnificent setting of the British Museum.

From the 12th century to the Act of Union in 1707,

Scotland had its own currency and coins.

This is a bawbee...

..and this wonderful, glittering thing is a unicorn.

Now, historical curiosities they may be,

but they're also amazingly relevant and resonant

because in the question of whether Scotland should go

independent, the issue of what currency it should use is red-hot.

Now, there was a time when Alex Salmond

wanted an independent Scotland to join the euro.

But these days, he has a different plan -

he wants to keep the pound.

Now, let's mull all this over a coffee in this Edinburgh cafe.

Every day, they bake a batch of referendum cupcakes -

yes, no and maybe -

and they use them as an unscientific straw poll.

At the moment, they do business in sterling,

which include Scottish banknotes.

And what the Yes campaign would like

is to keep things just that way under independence,

by doing a deal to share the pound in what's called a currency union.

It all sounds straightforward but, in London,

the Treasury had other ideas.

And in February, George Osborne played

what he thought was his trump card.

I could not, as Chancellor, recommend that we could share the pound

with an independent Scotland.

The evidence shows it wouldn't work, it would cost jobs and cost money.

If Scotland walks away from the UK, it walks away from the UK pound.

Alex Salmond retaliated.

This was a punch-up between two political bruisers.

To be told that we have no rights to assets jointly built up

is as insulting as it is demeaning.

To be told there are things we can't do will certainly elicit

a Scottish response that is as resolute

as it is uncomfortable to the No campaign.

It is yes, we can.

At the moment, quite a lot of the debate about currency options

has a tone of schoolboy squabbling in the playground.

George Osborne saying,

"It's my pound and I'm not going to let you have it,"

and Alex Salmond saying,

"No, it's my pound as well, and I want my share of it."

I think that's one of these questions where,

if you do actually get a yes vote for independence,

then officials sit down

and start negotiating sensible solutions to practical problems.

Perhaps the biggest problem is the long shadow cast by

the Eurozone's recent crisis.

There, too, independent countries share a currency

but they run their own tax-and-spend policies.

That led to disaster,

when smaller, weaker nations like Greece

had to be bailed out by bigger, successful economies like Germany.

And George Osborne worries that a currency union with Scotland

could leave taxpayers in the rest of the UK footing the bill

for Scotland's possible future profligacy.

UK taxpayers would have to transfer money to an independent Scotland

in times of economic stress

with limited prospect of any transfers the other way.

We got Britain out of the Eurozone bailouts,

now we'd be getting into an arrangement that was just the same.

The people who compare a sterling zone to the Eurozone, I think,

are comparing apples to oranges, here.

If you take a place like Germany and a place like Greece,

their productivities are about 50% apart,

and so it was always doomed to have some kind of difficulties.

They don't work well when economies are massively different in the way that they operate.

Ours work very closely together, and so the chances of it being successful are extremely high.

Now, it's always possible that in the event that the Scots

were to vote for independence,

the Government would buckle and would negotiate a formal currency union.

But there would probably be a steep price for Scotland

because Westminster would insist on tough controls on taxing, spending and borrowing,

and some would question whether that represented much in the way of economic independence.

If Scotland gave up the pound and it didn't want to join the euro,

there would be one final option.

It could create its own currency,

to, in effect, revive the bawbee or the unicorn.

That might give Scotland more economic freedom,

but it could also force what are called transaction costs,

charges for changing currency,

on any business that does trade across the border.

And given that two-thirds of Scotland's exports go to the rest of the UK,

that could be a big deal for the new nation.

The engineering firm the Weir Group is one of Scotland's biggest businesses,

trading in 70 countries.

The chief executive, Keith Cochrane,

commissioned a report to look at the pros and cons of independence,

and it found a new currency would come with a steep price tag.

It imposes significant additional costs on business.

Our report estimated some £800 million of costs involved with

business changing over to a new currency,

and then ongoing costs of some 500 million a year to Scottish business.

So, again, it starts to undermine the cost competitiveness

of a Scottish base, a Scottish location,

in terms of serving the rest of the UK.

Alex Salmond points out that businesses south of the border

would pay these transaction costs, too.

But if Westminster refused to share the pound,

a new currency might just be Scotland's only realistic option.

Now, if Scotland went back to the bawbee or the unicorn,

if it adopted its own currency,

it could gain some important economic freedoms,

but there could also be some big costs.

Now, if you are uncertain about the pros and cons of what currency

an independent Scotland should use, you're certainly not the only one.

This trade-off between the costs and benefits of independence

runs right through the next big area - how Scotland would borrow.

This is the Firth of Forth, just north of Edinburgh,

site of the iconic Victorian rail bridge

and a 20th-century road bridge.

But soon there'll be a third

because, taking shape on the water out here,

is a 21st-century road bridge.

It's exactly the kind of project

an independent Scotland would have to borrow to pay for.

This is where the new bridge is rising from the waters of the

Firth of Forth at a rate of four metres every ten days

as concrete is poured in. Now, by the middle of next year,

this central tower will be four times as tall, 210 metres high.

It's Scotland's most ambitious infrastructure project

in a generation.

What about the scale of this bridge?

How would you rate it in terms of size?

It's certainly one of the largest in the world.

It's definitely Champions League bridge construction.

The towers, with a 210-metre central tower, will be

the highest in the UK by quite a bit, and the main spans of 650 metres,

that's a large bridge construction, for sure.

Projects like this don't come cheap.

This one is on schedule and under budget,

but it'll still cost £1.4 billion of public money.

Governments borrow to fund big projects like this one.

The power to borrow, to raise money on the international markets

is therefore crucial for any independent nation.

The Scottish Government takes enormous pride

in its track record of investing in infrastructure,

and Alex Salmond believes that if Scotland were to go it alone,

he would have even more freedom to borrow to invest in vast

and ambitious projects like this one, and in that sense Scotland

would have much more control over its economic and industrial destiny.

But, in practice, how much extra financial freedom

would an independent Scotland have?

This issue of borrowing and debt is another vital question

at the heart of the independence debate.

The British Government has a huge national debt.

That's our historic accumulated rolling overdraft,

the total of all our deficits down the years.

It's likely to be around £1.5 trillion at the time of independence.

Now, as part of any independence deal,

Scotland would be expected to take on some of that burden.

So, what kind of share of the national debt would the Scots have?

Most people think, and including the First Minister,

that a reasonable basis would be a population share,

so that means an independent Scotland would take over

8.5% of the debt,

and the rest of the United Kingdom would shoulder the rest.

And in money terms, what are we talking about?

In money terms, in 2016, that's about £150 billion-worth.

So, the United Kingdom would effectively have

an IOU from the rest of Scotland over a number of years,

and the key issues are, what terms are those IOUs on?

Is there any collateral to back it?

And what interest rate would it charge Scotland?

So a deal would have to be done between Scotland and Westminster

on the size of that IOU, on the interest rate to be paid

and the date of its repayment.

But along with what Scotland would owe the rest of the UK,

an independent Scotland would also need to borrow on what's called

the bond market, a market with the power to make or break governments.

This is the London headquarters of PIMCO,

the biggest bond investors in the world.

It's in places like this that a key question for an independent Scotland would be settled -

how much would Scotland have to pay

to borrow from investors in the bond market?

Scotland would be a high-quality borrower, let's be clear about that.

Whether it would be absolutely the highest-quality borrower

comparable to the US or the UK or Canada, I think is unlikely.

What would it cost them to borrow?

Our best estimate, assuming a reasonably even split of assets and liabilities,

the interest rate would be between 0.5% and 1% more than the UK Government currently pays.

Scotland would be charged more to borrow than the rest of the UK,

mainly because it would have no track record as a borrower,

and although an extra 1% on the interest rate may not sound like a lot,

on debts running to tens of billions of pounds,

it wouldn't be trivial.

It would mean there'd be less money available to fund public services.

So, you, as an incredibly influential player on the bond market,

are clear that Scotland would have to pay more to borrow?

What would that mean for the prosperity of Scotland?

What it actually means, when you work through the numbers,

is that it would cost Scotland between 0.5% and 1% of their national income each year

to be in control of their own destiny,

and that really is the nub of the question.

Are they willing to pay that extra price

to be in control of their own destiny?

Now, those in favour of independence might and, in fact, do

dispute the precise figures, but few can doubt there would be

significant costs associated with independence.

However, some would see those costs

as an investment in Scotland's future prosperity,

as a price worth paying to secure

greater control over the country's economic and wider destiny.

The big question, therefore,

is how to weigh up those probable short-term costs

against the possible longer-term benefits.

So I sounded out some successful and influential businesspeople

to weigh up the costs and benefits of Scottish independence.

And I started on the factory floor.

This is an irreversible, this is a fundamental decision.

There will be no going back once this decision is made.

But you, personally, how are you going to vote?

I am going to vote no,

because I believe we've got the best of both worlds at this point.

We've got the ability to influence and set

our own domestic agenda here in Scotland

but also to be part of one of the world's largest economies

and get the benefits of scale

that are realised from that and, certainly, as we look at the question

in the round, the costs very much outweigh any potential benefits

that might arise from independence.

Tony Banks believes the costs have been exaggerated

and his eyes are on the prize.

All my life, I have waited for this moment.

And I think the moment is right.

I think that the global situation is right

for Scotland to become independent,

I think the people of Scotland

believe it is the right moment to become independent.

And I do believe that this huge responsibility

that we have on our shoulders as a nation

is not going to be taken lightly.

The bosses of defence giant BAE Systems, however,

who employ 3,000 people in Scotland,

many making warships for the British Government, see risks.

They worry that independence for Scotland could mean that those jobs have to go elsewhere.

Can you contemplate a Government in London

placing orders for warships from a company based in an independent Scotland?

It's certainly not their history.

And it's certainly, absolutely, according to their public statement,

not their intention.

I mean, the history is we build warships in the United Kingdom

for the United Kingdom. No evidence of a belief of change in that view.

If the Government were to decide it would be completely inappropriate

for warships to be built in an independent Scotland

as a foreign country, how serious would that be?

To say that they cannot be made there

would create a completely different programme of manufacture

which would have to be established elsewhere.

That is cost, that is time,

that is capability, and that is very undesirable for everyone.

But other business leaders don't think it would be

quite that clear cut.

Come with me to Grangemouth, 25 miles west of Edinburgh.

Jim Ratcliffe is the billionaire owner of this vast petrochemical plant,

a giant, sprawling complex at the heart of the Scottish economy.

I'm fairly neutral on independence,

I don't think independence will make

a great deal of difference to this facility.

Are you better off being a huge economy or are you better off being,

as Scotland might be, a smaller, perhaps nimbler country?

I'm not a believer, necessarily, in big is beautiful.

I think small can work,

it can be very, very focused, it can be very energetic,

it can be nimble and it can be extremely effective.

And...you can take Switzerland as a very good example of that,

it's an extremely successful economy,

it's one of the highest GDPs per capita

and it's the same size as Scotland.

There are some Scottish businesspeople who say to me

the reason they quite like the idea of independence

is they just like there being a shorter gap

between them and politicians who make decisions.

Is it as easy to pick up the phone and talk to George Osborne or David Cameron

as it is to pick up the phone and talk to Alex Salmond?

It's much easier to pick up the phone and talk to Alex Salmond than it is to George Osborne or David Cameron.

But what makes the evaluation of the costs and benefits almost impossible

is the sheer number of imponderables and unknowns.

Important decisions on currency and debt

will only be made after the vote.

We don't have all the information we need,

but that doesn't mean we know nothing at all

about whether an independent Scotland would be richer or poorer.

Are we talking about, in your view, Scotland being

way better off or way worse off than the rest of the UK

if it goes independent?

I wouldn't expect it to make a great big difference, it's not going to

end up in 20 years' time as a basket case,

probably, it's not going to end up in 20 years' time as massively richer than the rest of the UK.

The best place to start is, at the moment, the Scots are about as well off as the rest of us.

In 20 years' time, in or out, I expect they will still be just about as well off as the rest of us.

And if you had a vote, would you make that judgment on economics

or would you make that judgement on another basis?

To be honest, I wouldn't make the judgment on the basis of economics.

You can't vote on the basis you'll be £500 a year better off for sure,

or £500 a year worse off for sure, we just don't know.

You're probably not going to end up terribly differently off.

So if money isn't the decisive factor, what would be?

Well, this summer, a telling of Scotland's national story has become a bit of a hit.

This is Anchor Mill in Paisley, home to the Great Tapestry of Scotland.

It's the longest embroidered tapestry in the whole world,

and it depicts the history of Scotland from Bannockburn

to the Act of Union...

from the Hillman Imp

to Irn-Bru and Tunnock's tea cakes.

It's been seen by more than 100,000 visitors in the last year alone,

and it's proof that Scottish people

care deeply about their national identity.

It seems to me that if this debate is to be serious,

people should be voting about identity rather than about how much cash is in their pockets.

The slogan "give me liberty or give me £500"

doesn't have quite the same ring about it.

I think Scotland could be independent.

The big question is, should it be independent?

It's a huge decision. Huge decision.

It's the biggest vote we're going to take in 300 years,

so we can't sleepwalk into a decision

and then, a couple of weeks afterwards say,

"Oh, no, we've made a terrible mistake.

"Let's just go back to what was there before."

I think it would be foolish to say Scotland couldn't do it or it couldn't be successful.

I don't think that's the question. The question is,

would it be better to be part of something that is stronger,

that has more stability,

that has less uncertainty, and where there has been

an alignment of the two economies

for over 300 years, and I would say it's better to be part of that.

It's not where we are now, it's not where we've come from,

it's what we can be. What sort of nation can we be?

What sort of people can we be? If it's good,

that's down to the people of Scotland.

If it's bad, that's down to the people of Scotland.

Identity and history, Scots have it by the bucket load,

as this magnificent tapestry and its great popular success demonstrate.

That's why the impassioned debate about whether Scottish people would be richer or poorer

as a result of independence, well, it matters, but it shouldn't be the be-all and end-all.

Much more important, surely, is Scots' sense of self.

Who they think they are as a nation.