Nobel Prize winner – Oil wealth was “squandered” by UK

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A Nobel Prize winning economist has claimed that successive Westminster Government’s have “squandered” North Sea oil and has endorsed calls from the current SNP government for a Norwegian style oil fund to be set up.

Joseph Stiglitz warned that it was now “imperative” that an oil fund be set up in order to ensure that future generations can benefit from the wealth that still exists off of Scotland’s shores.

 

 

A Nobel Prize winning economist has claimed that successive Westminster Government’s have “squandered” North Sea oil and has endorsed calls from the current SNP government for a Norwegian style oil fund to be set up.

Joseph Stiglitz warned that it was now “imperative” that an oil fund be set up in order to ensure that future generations can benefit from the wealth that still exists off of Scotland’s shores.

Speaking on the BBC’s Newsnight Scotland programme Mr Stiglitz said:
“Oil is an asset below the ground and if you take that asset below the ground and you spend it you’re poor.

“It’s like any other asset, you’re living off your wealth and if you’re living off your wealth it is not sustainable.

“You [the UK] squandered that wealth, you took all that North Sea oil and you did very well for that period because you were living off your wealth.

“You mistook the success of the Thatcher era as a success based on good economic policy when it was really a success based on living off your wealth and leaving future generations impoverished.”

Mr Stiglitz backed the calls from the SNP for an oil fund to be set up and added:
“You can get higher returns by investments in a whole variety of areas, so they [the SNP] are absolutely right.

“It is all the more imperative that you do it now because you should now realise the mistake of the past …. you have to make up for lost time”.

http://www.youtube.com/watch?v=7LnPL96D72M{/youtube}

Responding to the oil fund comments SNP MP and Treasury Spokesman Stewart Hosie said:
“This is a devastating attack on the UK’s handling of Scotland’s oil wealth.

“The oil under our seas could have built wealth to support future generations.  Instead as Stiglitz says it was “squandered” by a UK Government that failed to look to the future.

“The contrast with Norway whose energy fund which supports pensions and investments for future generations is stark.

“It is vital that an oil fund is established as soon as possible to prevent what is left of the oil wealth under our seas being wasted by another Tory Government.”

Mr Hosie also attacked the current Conservative – Lib Dem and previous Labour government’s cuts agenda calling them “wrong headed”.

Mr Hosie added:
“We should be investing in the public projects that will deliver growth and opportunities not cutting investment simply to fulfil some Conservative ideology.

“Joseph Stiglitz is one of the world’s leading economists and his views should be heeded by the current Government.  We should invest in our economy to recover from recession and harvest our oil wealth not just for now but for future generations.”

Norway’s sovereign wealth fund, the world’s second largest, saw the value of its investments rise a record 26 percent last year.

The fund is currently worth over $450 billion.

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