The Scotsman on a report written by economists at Scottish Enterprise:

The astonishing extent to which state spending is propping up Scotland’s economy is laid bare in new figures which suggest the ballooning public sector is strangling wealth creation.

The findings show that in some areas, three-quarters of the local economy is made up solely of the billions of pounds pumped in by the government.

I think I might replace the sentence ’state spending is propping up Scotland’s economy ‘ with something a lot closer to the truth - such as, ’state spending is propping up Labour’s tartan vote block’. Our tax-and-spend government maintains artificially low unemployment by moving unemployed onto disability benefit and by buying public sector jobs - as if the country needs them.

Such is the size of the public sector in these areas, business chiefs and economists fear it is swallowing up private enterprise, hoovering up talented workers and making it nearly impossible for companies to prosper.

The findings shed fresh light on Scotland’s chronic dependency culture - in which the economy is becoming increasingly reliant upon state handouts to provide wages for the ever rising army of public sector workers.

Some of the findings are pitiful. Just how does a person have any pride in a town or area when all that it is has been provided by tax-payers - via the government?

In Argyll and Clyde, 76% of the economy is generated from the state, in the form of spending by councils, health boards and through other forms of government activity. In Ayrshire and Arran, the figure is 74%. In Lanarkshire, it is 72%.

Only in oil-rich Grampian (35%) and finance-friendly Lothians (39%) do the figures fall below comparable English levels. Across the UK, state spending accounts for approximately 40% of the economy.

The figures have almost certainly been boosted by the rocketing sums spent by Scotland’s government since devolution. By 2008, Scottish Executive spending will be double that of 1999. Scotland’s benefits bill has also rocketed. Scottish Enterprise claims that total public spending in Scotland in 2002-03 reached £40bn, or 55% of Scotland’s total economy.

The warnings are stark - and probably set to be ignored:

Business chiefs warned that the high levels were ruining hopes of boosting growth.

Alan Mitchell of CBI Scotland said: “To have that much of the economy generated by wealth spending rather than wealth creating can’t be good for the Scottish economy long term.

“It has a major effect on the ability of companies to recruit and retain staff. Their margins are tight and they cannot compete in terms of holidays, pensions, childcare and all the other add-ons that the public sector can offer. If we don’t have ambitious small to medium size businesses growing then we aren’t going to develop that economy long term.”

Even the Scottish National Party is concerned:

Jim Mather, enterprise spokesman for the SNP said high levels of public spending would leave Scotland dangerously exposed when government funding was cut back.

Which is plain common sense (if you’re not a card-carrying member of the Blairite Tendency).

No wonder the Scottish National Party only secured 6 seats in the May General Election. Independence is just what Scotland doesn’t want.

[Thanks, The Anglo-Saxon Chronicle]