Is it time for a Scottish wealth fund?
Oxford SWF Project, a university think tank on sovereign wealth funds, is looking at reports that the latest entry in the field could be Scotland. The project has a new post about the Scottish government floating the idea of an oil stabilisation fund to use oil and gas revenues. It cites Scottish cabinet secretary for finance John Swinney looking abroad gleefully:
“We want to harness the benefit of oil revenues now for future years. An oil fund can provide greater stability, protect our economy and support the transition to a low carbon economy. Norway’s oil fund is worth over £200 billion – despite the first instalment being made as recently as the mid 1990s – and Alaska’s oil fund even gives money back to its citizens every year.”
The SWF project reckons the idea is a good one, but wonders if something other than meets the eye is at play. It had two questions.
First, it wonders whether the plan might just be a political rebuke for the UK government from the ruling (and separatist) Scottish National Party over a perceived lack of savings over the years. Second, it notes that the UK government floated the idea of a strategic investments fund back in April and questions whether “the Scottish SWF reflects a ‘whatever they have, we should have’ mentality”.
Here’s a third question. Is it not a bit late for an oil fund? UK oil and gas output, most of which is in Scottish waters, has more than halved since 1999.