IT IS 2062, and the youngest people to vote in Scotland’s referendum, then aged 16, are now approaching retirement age. A perfect storm of shifting demographics, dwindling oil and poor health has left those north of the border worse off than the rest of the UK, leading many to question whether they were right to vote “yes” all those years ago…
Back in the present, it is impossible to confidently predict what will happen should Scotland decide to go it alone. But three factors will come into play.
The first is an unavoidable fact of life: we are all getting older. Developed nations across the world are set to struggle with the effects of an ageing population over the next 50 years, but demographic projections suggest the impact will be felt even harder in Scotland.
The Institute of Fiscal Studies (IFS), a think-tank in London, predicts that by 2062 Scotland’s population will have grown by just 4.4 per cent, compared with 22.8 per cent in the UK as a whole. The problem for Scotland is that its under-65 population will shrink while its over-65s increase, putting big pressure on public finances.
The Scottish government says independence will allow the nation to pursue a very different immigration strategy to the rest of the UK. But if working-age migrants don’t come as hoped, Scotland will find it more difficult to support its ageing population.
Things get worse when North Sea oil and gas are taken into account. “Oil revenues will almost certainly fall over the longer term,” says David Phillips at the IFS. “If it takes decades, that would give Scotland time to adjust, although it would still involve some potentially painful choices.”
Addressing the shortfall in revenues will mean higher taxes or a fall in living standards – something Scotland can ill afford: life expectancy is already 2.3 years lower for Scottish men than those in the rest of the UK. The difference is particularly stark in Glasgow, where life expectancy at birth is just 72.6 years for boys and 78.5 for girls, compared with the UK averages of 78.9 and 82.7 years. “Health is Scotland’s Achilles’ heel,” says Gerry McCartney of NHS Scotland. And it’s a relatively recent phenomenon.
The reason for the disparity is not entirely clear, as it is difficult to untangle the interconnected health effects of lifestyle, culture and economics, but inequality in Scotland certainly plays a role. “Quite a large proportion of the higher mortality is explicable simply by poverty and deprivation,” says McCartney.
“A large proportion of Scotland’s higher mortality is simply down to poverty and deprivation”
The Scottish government says a vote for independence will reduce inequality. But a study by David Comerford and David Eiser at the University of Stirling suggests that new Scottish powers to increase taxes or benefits may have little effect. That’s because small nations can find it difficult to implement radically different policies to their larger neighbours: people can simply decide to cross the border in search of lower taxes, for example. This is particularly problematic when it comes to funding pensions, which depend on a thriving workforce. “Raising tax rates to provide pensions could be a self-defeating policy if it leads to an exodus of workers,” says Comerford.
The voting age for the Scottish referendum has been lowered to 16 from the normal UK voting age of 18, to let teenagers have a say in their country’s future. If independence goes wrong, a youthful yes vote could prove a big mistake.
Read more: “Four futures for an independent Scotland“
This article appeared in print under the headline “Don’t look back in anger from 2062”
More on these topics: