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Oil wars: SNP, Coalition step up fight over North Sea revenue

Scottish and UK politicians have continued to clash over the future use of North Sea oil and gas money a day after senior ministers focused the independence debate on the industry in Aberdeen.

The SNP administration stepped up calls for an oil fund, similar to one operating in Norway, while repeating the claim that the UK Government squandered cash over decades.

But UK ministers said Norway is a "false comparison" and demanded the Scottish Government sets out the full financial implications of creating a new fund after independence.

The interventions follow high-profile meetings led by Prime Minister David Cameron and First Minister Alex Salmond in the north-east.

The two leaders were with their cabinets just miles apart, both highlighting the importance they attach to the industry.

At Holyrood today, Scottish energy minister Fergus Ewing said: "Norway has used the powers of independence, as a country roughly the same size in population terms as Scotland, to enormous advantage.

"Not just now but for future generations of Norwegians for whom this is an investment that will create opportunities for that country for a long time."

SNP backbencher Dennis Robertson said the fund is worth about £100,000 for every person in Norway.

"The UK Government should apologise to the people of Scotland for squandering the oil and gas assets over the years," he said.

Opposition parties criticised the approach.

Labour MSP Richard Baker said the fund would immediately be swallowed up by costs associated with decommissioning oil facilities.

"While there is significant potential in the North Sea still, the costs of production are increasing significantly," he said.

Decommissioning could cost billions, he added.

Lib Dem leader Willie Rennie said costs would have to be taken on by the Scottish Government.

"The SNP have spent the North Sea oil revenues several times over," he said.

"First they wanted to spend it on welfare, then on capital infrastructure and now an oil fund, but an independent Scotland would need it for the decommissioning of the North Sea."

Alastair Carmichael, the Scottish Secretary in the UK Government, demanded more economic details.

"It takes only basic mathematics to understand that you cannot spend and save the same money at the same time," he said.

"The Scottish Government's plan for an oil fund is another triumph of flat-earth economics over reality.

"The First Minister needs to be clear an independent Scotland would only be able to emulate Norway in one way - by not using the UK pound.

"When it comes to an oil fund, we have heard a great deal of hot air in recent days about how Scotland has nothing to show for the oil revenues over the years, conveniently ignoring the investment and higher spending per head it has helped fund in Scotland.

"The facts are clear. If an independent Scotland wants an oil fund, the First Minister has to tell us whether he will cut public services by 8% or hike up income and other taxes by 11%. There is no way around this issue and pretending otherwise is an attempt to fool the people of Scotland.

"We have heard the Scottish Government talking a lot about the Norwegian model in the last few days but it is a false comparison. They need to come clean on the complexities and costs."

A spokesman for Mr Ewing said: "Alastair Carmichael is teaming up with David Cameron in trying to fool people into believing Scotland is the only country on Earth for which oil is a burden and not a terrific bonus.

"That is a ridiculous claim, and one which anyone with an ounce of common sense can see right through.

"Mr Carmichael is part of the Westminster establishment which has squandered Scotland's vast oil wealth for decades.

"And he should apologise for the fact the UK stands alone with Iraq as the only major oil producers to have no oil savings fund like Norway's, which is worth around £470 billion and is the biggest of its kind in the world.

"In contrast, Scotland's oil fund stands at £0.00 - and that is something we will put right in an independent Scotland, saving money for future generations."

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