:00:11. > :00:14.On Newsnight Scotland: What do today's desultory growth
:00:14. > :00:17.figures tell us about how the economy is doing here?
:00:17. > :00:20.Could you feel more British in an independent Scotland?
:00:20. > :00:23.We talk to the politician who thinks you could.
:00:23. > :00:25.Good evening. Now, as you may just have seen on
:00:25. > :00:29.Newsnight, today's figures show that the UK's economy pretty much
:00:29. > :00:39.flat lined in the second quarter of this year. Last week we had figures
:00:39. > :00:43.
:00:43. > :00:47.showing Scottish GDP for the first Gross Domestic Product is a measure
:00:47. > :00:51.of the performance of the hole economy, all the goods and services
:00:51. > :00:56.produced in a certain period, it is used to judged whether the economy
:00:56. > :01:02.is growing or not so in these post recessionary days, it is more
:01:02. > :01:06.politically sensitive than usual. The UK figures come out soon after
:01:06. > :01:10.the relevant quarter. In January to March, the British figure was 0.5%.
:01:10. > :01:15.That was not seen as a strong performance, but at least it didn't
:01:15. > :01:19.fall as it had in the previous quarter. Coalition politicians had
:01:19. > :01:23.been hoping that April to June quarter would show a strengthening
:01:23. > :01:28.in growth, with all the associated political benefits. Opponents
:01:28. > :01:32.including Labour and the SNP say today's weak figure of 0.2% suppose
:01:32. > :01:37.their argument the Osbourne economic policies is just wrong and
:01:37. > :01:45.something new needs to be done to inject more growth into the
:01:45. > :01:55.I'm joined by Professor Brian Ashcroft of the Fraser of Allander
:01:55. > :01:57.
:01:57. > :02:02.Institute. If we had 0.5% growth and that's gone down to 0.2% and
:02:02. > :02:05.that went down, it would look grim, wouldn't it? Well, it is worrying
:02:05. > :02:11.for Scotland. There is no doubt about it. It is worrying for the UK.
:02:11. > :02:15.It is worrying for the world economy. What we are seeing at the
:02:15. > :02:20.moment is essentially the developed parts of the world economy is
:02:20. > :02:27.poised between a situation of recovery and a situation of
:02:27. > :02:35.prolonged stagnation. That's the situation that we are at the and
:02:35. > :02:39.the the significant happenings in Europe and the USA which makes a
:02:39. > :02:42.weaker recovery less stronger than it once was and that's quite
:02:42. > :02:46.worrying. You heard politicians talking there
:02:46. > :02:56.about this. It is not that important, is it, whether even you
:02:56. > :03:01.got a cut in GDP over three months or whether it is 0.4% or 0.5% or
:03:01. > :03:04.0.2%, the basic point is we are years after the depth of this
:03:04. > :03:11.recession and not much is happening? Not much is happening.
:03:11. > :03:14.The national shoot in London are predicting the UK will return to
:03:15. > :03:20.pre-recession level after 60 months. That's longer than the great
:03:20. > :03:23.depression. It is longer than the recession in the 1980s. Scotland's
:03:23. > :03:28.recovery is weaker. It could be longer for Scotland. Why is this
:03:28. > :03:31.so? Because of the nature of this great recession we have just gone
:03:31. > :03:39.through driven by a housing bubble and a banking crisis and the
:03:39. > :03:43.evidence is that the banking crisis caused recession takes longer to
:03:43. > :03:47.unwind than other recessions. On top of that the UK and Scotland and
:03:48. > :03:56.the USA had a problem in that its households were indebted and they
:03:56. > :04:00.have had to adjust considerably to the effect of the credit crunch,
:04:00. > :04:05.unwin their personal balance sheet and spending has been reduced
:04:05. > :04:07.considerably and its con consumption that's failing to
:04:07. > :04:12.recover. It is the same for Scotland.
:04:12. > :04:17.Is there a case for trying something else whether you call it
:04:17. > :04:21.a Plan B or not? Well, I think there is. I do believe, and I have
:04:21. > :04:28.said this before, I think there is a case for a tax cut. I think there
:04:28. > :04:34.is probably a case for a tax cut that gets closest to those with
:04:34. > :04:38.least incomes. It is probably a VAT cut. I don't agree with a cut in
:04:38. > :04:43.the 50 pence rate for the reasons that the rich are unlikely to spend
:04:43. > :04:46.it. There is a case for a VAT cut. The other problem is that we talk
:04:46. > :04:49.about the prospect of quantitative easing and I think we will get some
:04:49. > :04:53.and I would welcome that. The problem is for technical reasons,
:04:53. > :04:58.we have a rate of interest which is virtually zero. In those
:04:58. > :05:02.circumstances, printing money will tend not to have much of an impact.
:05:02. > :05:07.It won't have an inflationary effect. As economist call it, we
:05:07. > :05:12.are not close to a liquidity trap. In order for this to work, it has
:05:12. > :05:16.to push up asset prices. There is a little bit of evidence that
:05:16. > :05:20.financial asset prices did go up following the last last
:05:20. > :05:25.quantitative easing, but we know the recent data on bank money show
:05:25. > :05:31.that it is falling and that's incredibly worrying.
:05:31. > :05:37.An obvious point given we have good figures or the UK and Scotland for
:05:37. > :05:42.employment and unemployment over the past few months and given that
:05:42. > :05:47.we have discussed before why it is that unemployment didn't up as much
:05:47. > :05:56.as it did in shallower recessions. Does it really matter what happens
:05:56. > :06:00.to growth as we are as George Osborne claims, as Michael Fallon
:06:00. > :06:04.was claiming the UK has five million jobs more than last year.
:06:04. > :06:09.Well, we are creating jobs and that's the other side of the coin
:06:09. > :06:14.to suggest that it is not wholly bleak. Unemployment and employment
:06:14. > :06:19.lag on output and we are seeing the nature of employment creation in
:06:19. > :06:22.Scotland particularly less to an extent in the UK is moving more
:06:22. > :06:26.towards part-time employment and away from full-time employment. The
:06:26. > :06:30.amount of labour labour service that is expanding is less in the
:06:31. > :06:36.job numbers imply and many are on temporary contracts as well. We
:06:36. > :06:41.also expect for Scotland towards the latter part of this year we
:06:41. > :06:44.expect unemployment to rise again because Scotland has done well. Its
:06:44. > :06:50.unemployment tended to fall and it moved closer to the United Kingdom,
:06:50. > :06:53.but I would expect with growth of 0.1% in the first quarter, probably
:06:53. > :06:57.flat lining growth in the second second quarter in Scotland, we are
:06:57. > :07:00.going to see unemployment rise in Scotland. There is a big unknown
:07:00. > :07:07.about where we are going to go after that. Are we going to flat
:07:07. > :07:13.line for ten years like the Japanese did at the end of the
:07:13. > :07:17.1980s or or will we recover which is what we are forecasting, but it
:07:17. > :07:21.is not certain. Your latest forecast in the light
:07:21. > :07:26.of what happened since you made that forecast, is that sustainable?
:07:26. > :07:31.No, we think it is still possible. So we are not going to change it.
:07:31. > :07:36.The UK economy grow 0.7% over the last year. Most UK forecasters are
:07:36. > :07:44.around about 1.3% for this year. We are still hoping that there is pick
:07:44. > :07:47.up, but obviously it is uncertain. Now, it may be getting precious
:07:47. > :07:49.close to the journalistic silly season, so it wasn't too surprising
:07:49. > :07:53.to read headlines saying that making Scotland independent would
:07:53. > :07:57.make people here feel more British. But the idea comes from a prominent
:07:57. > :08:07.nationalist MP. Is he on to something? We'll hear from him and
:08:07. > :08:07.
:08:07. > :08:12.a political opponent shortly. First, What makes asked the British Isles?
:08:12. > :08:18.Is it bulldogs, the Beatles, Burberry raincoats or bright red
:08:18. > :08:22.postboxes? The backdates, Balmoral or even the British Army?
:08:22. > :08:27.Fundamentally, the thing that makes us the British Isles is the union
:08:27. > :08:35.of the Crown's. So people of Queen's Park in Glasgow, do you
:08:35. > :08:43.feel British? To me, Britishness is English. It derives from England,
:08:43. > :08:48.for me. I think that is Britishness. So, do you feel more Scottish?
:08:48. > :08:54.Scottish tour through. I would call myself Scottish, but as a part of
:08:54. > :08:58.Britain. We're quite lucky in that we can have dual identity. I have
:08:58. > :09:06.live in England will and although it was different I did not feel I
:09:06. > :09:10.was in a foreign country. So both, definitely. One thing that unites
:09:10. > :09:15.the country when they get this whether his we certainly make the
:09:15. > :09:20.most of it. But at the centre of this debate is the notion of
:09:20. > :09:23.identity, and the prospect of constitutional change. Can you feel
:09:23. > :09:30.British and Scottish? Antennae for British and still want
:09:30. > :09:33.independence? -- and can you feel British. Of course, the two of them
:09:33. > :09:39.can logically co-exist. But how many people in Scotland think that
:09:39. > :09:43.way? Many people in Scotland feel the Scottish sense of identity and
:09:43. > :09:46.the British sense of identity. If you give people both options,
:09:46. > :09:50.around a third will spontaneously say they are both Scottish and
:09:50. > :09:53.British, and if you put the issue to them more director, at least
:09:53. > :09:58.two-thirds will choose some combination of being Scottish and
:09:58. > :10:02.British. Having said that, what is Clare is that for most people,
:10:02. > :10:09.their sense of being Scottish is more important than their sense of
:10:09. > :10:13.being British. And this is the very man who started this debate.
:10:13. > :10:18.Appearing on a very British institution. Pete Wishart of the
:10:18. > :10:24.SNP, formerly of run rate. He may have appealed to an audience back
:10:24. > :10:27.and, but has he got it all wrong this time? Those people who feel
:10:27. > :10:31.most strongly Scottish sure most in favour of independence, but what is
:10:31. > :10:36.also true is that even amongst those people who say they are
:10:36. > :10:40.Scottish and not British, less than half favour independence. The SNP
:10:40. > :10:45.her going to get a much and it -- majority for independence, but they
:10:45. > :10:52.have to feel those people who deal prematurely Scottish to back the
:10:52. > :10:58.idea. So what will happen if or when are Kingdom is no longer
:10:58. > :11:01.United? Will it increase our fondness for all things British, or
:11:01. > :11:10.will we leave that identity behind and be happy to go it completely
:11:10. > :11:15.alone? I am joined now by the S N P MP,
:11:15. > :11:19.Pete Wishart, and by the deadly leader of the Scottish Lib Dems, Jo
:11:19. > :11:28.Swinson. -- deputy leader. I bet you are missing those leather
:11:28. > :11:35.trousers! I have to say, no I am not! Give us the short version.
:11:35. > :11:40.come from Perth, saw them as much British as somebody from Copenhagen
:11:40. > :11:45.or Stockholm were Scandinavia. Britishness is a curious and very
:11:45. > :11:50.difficult concept. There are some excruciating attempts to define it
:11:50. > :11:54.and categorise it over the past few years, Gordon Brown and Michael
:11:54. > :11:59.Portillo's attempts. But there is no doubt that people do feel
:11:59. > :12:03.Scottish and British, even in Scotland. What we can do with
:12:03. > :12:08.independence is enhance that relationship. People will still
:12:08. > :12:12.have all those cultural ties, but we can write a new chapter based on
:12:12. > :12:18.equality and mutual respect. I think we can enhance British
:12:18. > :12:21.institutions. It could be better. It sounds a bit like a trick ticket
:12:21. > :12:26.people in Scotland on that they can be British, but they will not
:12:27. > :12:32.actually be in Britain. It is no trick. People do feel British in
:12:32. > :12:35.Scotland and what we want to try and do is ensure people can
:12:35. > :12:41.continue to feel British. If the see themselves as primarily
:12:41. > :12:43.Scottish, that is OK as well. These ties will also be enhanced because
:12:43. > :12:49.we will be approaching these arrangements with a new sense of
:12:49. > :12:56.equality and a real sense of mutual respect. That can only be good.
:12:56. > :13:00.do nothing Jo Swinton appeal -- agrees. I am afraid not. Lately of
:13:00. > :13:05.the is the, it's got and separates from the rest of the UK, the
:13:05. > :13:10.concept of Britishness becomes very much a historical concept. How many
:13:10. > :13:13.people in Slovenia still talk about being Yugoslavian? That would be
:13:13. > :13:17.what it would become. Something in our history. There are many people
:13:17. > :13:21.who do not want Britishness to be something that is just historic. We
:13:22. > :13:26.would not have British Army or British embassies abroad. A lot of
:13:26. > :13:30.things that make up Britishness just would not exist any more as a
:13:30. > :13:35.result of Scotland separating. I do not think the SNP can have it all
:13:35. > :13:38.ways. Campaign for independence as much as you like but do not try to
:13:38. > :13:43.say you can have your cake and eat it and have a separate Scotland
:13:43. > :13:48.that was somehow still be British. I'm getting confused now about what
:13:48. > :13:51.the SNP mean by independence. I am not sure whether Jo Swinson said is
:13:52. > :13:55.right. We did we have the British Army and some of the kind of
:13:55. > :14:00.articles that some a few people have been writing? What we will
:14:00. > :14:07.definitely have is a whole range of British institutions, and new
:14:07. > :14:10.British institutions. The British armed forces, for example? Like
:14:10. > :14:15.immigration, we would have to have some kind of cross border court --
:14:15. > :14:21.Corporation. But because we will be independent, we will come to the
:14:21. > :14:28.table and put forward our case, structural depopulation, whereas in
:14:28. > :14:32.England, the population is over cooking. We will not be ignored.
:14:32. > :14:37.Out of curiosity, in this new relationship, would we have the
:14:37. > :14:45.British welfare system? I would hope not. I would think we can do
:14:45. > :14:50.this ten times better. So this other... The sort of stabilisers
:14:50. > :14:53.that work in the economy at the moment, people in the areas of the
:14:53. > :14:58.UK where it is lower, effectively subsidise that and vice versa, that
:14:58. > :15:02.would not work? I do not know what you are getting at. All I can say
:15:02. > :15:07.is when we become independent, we will have cross-border institutions.
:15:07. > :15:12.I am happy for them to be called British and I think that is fine.
:15:12. > :15:17.We are geographically British. I cannot see a problem with
:15:17. > :15:21.continuing and constructing new institutions. Approaching that the
:15:21. > :15:26.the new political arrangement, we can enhance that. The problem
:15:26. > :15:30.fridges, laugh if you like, but Pete we shirt and some others, at
:15:30. > :15:34.least they are trying to address this at that and the level. I am
:15:34. > :15:40.not sure people like you, who or against independence, are actually
:15:41. > :15:44.coming up with many arguments other than just saying, oh, rubbish.
:15:44. > :15:47.we are to have the discussion about the real issue of the independence,
:15:47. > :15:51.that is different from the discussion about whether you can
:15:51. > :15:55.have a separate Scotland that is also British. But I think the fact
:15:55. > :16:00.the SNP are bringing forward these arguments is to cloud the real
:16:00. > :16:04.issue. We have been talking about is confused set of things, we did
:16:04. > :16:08.beat the British Army or the British welfare system, what with
:16:08. > :16:13.the costs be for our education system, what would our share of the
:16:13. > :16:16.deficit be? The SNP has had decades to put together their plans as to
:16:17. > :16:20.what this would be like, but they cannot answer these questions. If
:16:20. > :16:25.we're going to have a debate, we need to have those basic building
:16:25. > :16:30.blocks of information. I do not want to put words in his nose, I
:16:30. > :16:34.think the point he is tried to make is that it is not unreasonable,
:16:34. > :16:38.there is no logical reason why an independent Scotland could not
:16:38. > :16:43.still feel British, and there could be a whole network of civil society,
:16:43. > :16:47.rather than political relationships, between Scotland, England and the
:16:47. > :16:52.rest of the UK. If you look at other countries around the world, I
:16:52. > :16:57.do nothing those all ties have been maintained. You would still have
:16:57. > :17:00.the heritage, but what would happen I think, England and people in
:17:01. > :17:05.England would start to use the English identity Farmoor. So on the
:17:05. > :17:08.other side of the border, the whole Britishness concept would start to
:17:08. > :17:13.break down as well. That is fine for people who would like to see
:17:14. > :17:18.that happen. But I do not like this rosy picture that somehow all that
:17:18. > :17:22.Britishness would somehow carry on. The obvious riposte is to say, the
:17:22. > :17:27.easy way of being British and Scottish, just be part of Britain.
:17:27. > :17:32.But we can have something better. We will continue with all these
:17:32. > :17:42.fantastic social ties, the cultural inheritance that Jo Swinson is
:17:42. > :17:43.
:17:43. > :17:48.talking about, that is part of my history as a patriotic Scot.
:17:48. > :17:58.are both good to have to come back and continue this some other time.
:17:58. > :18:04.
:18:04. > :18:14.-- going to have to come back. This is a Scottish figure,
:18:14. > :18:24.
:18:25. > :18:28.That is all for tonight, I am back The western side of the UK saw the
:18:28. > :18:31.sunniest weather yesterday and that is where we start in the morning.
:18:31. > :18:35.Giving more cloud for central and eastern areas of England. Sunny
:18:35. > :18:39.spells and Scotland. Rain will arrive in Northern Ireland and the
:18:39. > :18:44.Western Isles. Northern English be dry with some sunshine, it may
:18:44. > :18:48.brighten up to the east of the Pennines. The odd shower feeding to
:18:48. > :18:52.the east of London. The chance of seeing some sunshine as you have
:18:52. > :18:58.further west. It should be a fine day in the south of England. 23 or
:18:59. > :19:02.24 Celsius. Quite pleasant when the sun is out. Some patchy cloud, and
:19:02. > :19:06.in Wales in the afternoon, but still some sunshine. For Northern
:19:06. > :19:10.Ireland, after a bright start, cloudy over from the West and we
:19:10. > :19:14.see drizzly rain heading towards Belfast. By that time, some rain
:19:14. > :19:21.heading into the west of the mainland of Scotland, and ahead of
:19:21. > :19:24.its, some sunshine. 24 Celsius in the Moray Firth. That is the city
:19:24. > :19:29.forecast over the next couple of days. Wet weather arriving in
:19:29. > :19:33.Belfast. It turns DUP in Edinburgh and Inverness by Thursday. But try
:19:33. > :19:39.for the South across England and Wales. Not a great deal of sunshine