Monday 21 September 2009

It's Norway's Oil

Like Leaves on the Line, I'm always interested to see the progress of small independent nations. I think this news rips the arc out of the Daily Record's oh-so-amusing pun.

True, Ireland and Iceland have some way to go on their road to recovery, but I note that EU Commissioner Charlie McCreevy said the "international perception was that Ireland's economic problems were worse than they are". Wonder what he'd say to certain Labour politicians in Scotland?

Before one of the cynical unionists appears to make a comment - I appreciate that a lot of our oil revenues have been squandered over the years, but the recent discovery of new gas reserves would suggest that all is certainly not lost.


G Laird said...

Dear Alison

I am definately sure that some of it is ours.

I will ask the Norwegians next time I see them and ask for a few barrels back.

Can't do any harm!

Yours sincerely

George Laird
The Campaign for Human Rights at Glasgow University

BellgroveBelle said...

Oh, Norway's oil is definitely belonging to Norway. I wish we could say the same!

Yousuf Hamid said...

The problem is that if you wanted to invest in an oil fund in the years when we were in surplus then even with all the oil revenues from the North Sea going back the full 27 years, there would be only 9 years when we would have invested anything.

Alternatively if you had invested it all in an oil fund at the start then we would have had a gowing deficit for the past 20 years, the fact oil prices have halved recently hasn't exactly helped either.

Which is all a great shame because it would have been wonderful if there was this nirvana of wealth which could cure our fine countries sociall ills but even if you went back 28 years it wouldn't have worked, never mind now.

BellgroveBelle said...

The figures in the report are far too simplistic and don't take into account all elements of the economy. Surpluses and deficits happened for reasons rolled up in UK policy.

An example of this is that we 'pay out' in Scotland on things like defence (trident, Iraq) that we wouldn't be paying out if we were independent. Different priorities and choices in the future would dictate that - not how we spent in the past.

As ever, my stance is that oil is a bonus that most countries don't have - we're exceptionally lucky in that respect. The argument for independence does not rest on oil alone!

I agree with the statement

"Oil revenues can be used only once, you can’t spend them to offset an expenditure black hole and invest them in an oil fund at the same time."

and would argue that investing would gain you more than short term spending - as Norway has found.

joe90 kane said...

The Daily Retard (or 'The Daily Turd' as I affectionately refer to it) - real cutting edge corporate journalism. No wonder it's circulation figures are dying -
List of newspapers in the United Kingdom by circulation

Maybe New Labour might want to spend taxpayers money taking out adverts in The Daily Rubbish, as it once used to, in order to help keep it afloat?

The Iron Chancellor, Gordon Brown, done such a good job with the British economy for 10 years that New Labour annointed him Prime Minister, no election required.

After his 10 years as Chancellor, the UK economy only completely caved-in and taxpayers were forced to rescue it from utter oblivion. We will all be paying off New Labour's debts for decades to come.

And Gordon Brown is now carrying on as Prime Minister where he left off as Chancellor - a complete and utter disaster zone.

Imagine the Iceland economy being managed for 10 years by Gordon Brown?
Icelanders don't know how lucky they are.

Olje Fondet said...

The now ‘Norwegian Government Pension Fund – Global’ was only established in 1990. It is wholly owned by the Ministry of Foreign Affairs. The Council on Ethics, able to suggest withdrawal of investments from companies operating contrary to foreign policy, was only established five years ago. Over recent years the Ministry has disinvested from a range of multinational companies for human rights, environmental and other wrongs and the Fund continues to go from strength to strength.

When their Annual report 2008 was sent to me by the Council on Ethics the covering letter noted that the value of the Norwegian Government Pension Fund – Global was standing at approximately 365 billion USD, as of 31st December 2008. Consider that sum in the context of the devolved budget of Scotland, or even the likely budget of independent Scotland.

I am frankly embarrassed for the individual here who has managed to make a complete hash of rehashing parts of the Scotland Office report. I am also at a loss to recall a UK Government ‘report’ as poorly written as the June 2009 Scotland Office one. Believe me, there is some competition for that title! Only in Scotland could we be bemoaning the potential for a similar Petroleum/Pension Fund to that of Norway and Cllr Thewliss correctly notes the simplistic nature of the UK oil report/ absence of any consideration that the other policies of independent Scotland over recent decades would differed to that actually practiced by HMG.

Debate today about the Fund in Norway tends to revolve around what to do with all the wealth they have accumulated – spend a larger percentage of it or continue to invest. It was discussed in the recent elections in Norway. If only Scotland would have the opportunity to make such a choice.

One has to wonder if Gordon Brown announced plans for such a Fund next week whether Yousuf Hamid would still be using the same argument.

joe90 kane said...

Here is a relevant comment by the always excellent Eddie Truman of the Scottish Socialist Party -
Comment 5 Eddie Truman — 23 September, 2009 @ 7:46 pm
Wales and Labour's Lost Voters
Socialist Unity
23 Sept 2009
...England does not, repeat does not, “foot the bill” for the provinces that it rules under the Union.
The facts are that North Sea oil has bankrolled the Westminster regime since its discovery.
Here are the facts;

Since 1976-77, the UK Government has raised approximately £155 billion in direct tax revenue from oil and gas production. Adjusted for inflation, this is equivalent to £269 billion (2008 prices); or approximately nine times the annual Scottish Government Budget. These revenues have gone directly into the UK Exchequer, with successive governments using the windfall to fund public spending and to seek to reduce taxation across the UK.

An Oil Fund for Scotland: Taking forward our National Conversation
The Scottish Government
Raighaltas na h-Alba

Yousuf Hamid said...
This comment has been removed by the author.
Yousuf Hamid said...

The problem with that argument is that you are saying that there would be structural spending cuts in an Independent Scotland, wherever it would come.

To be fair, at least you are honest about it.

And the difference with Norway is that they have almost twice as many barrels of oil, 2.3 times more oil revenues and 75% more production. They're better at football and Eurovision than us too...