Scottish flagScottish independence is unlikely to benefit a
shrunken UK and could even represent a net economic cost,
according to a former Treasury economist.  Independence could
shrink the UK economy by more than 10%, damage UK exports, scare
off investors and reduce tax receipts, international
macroeconomics firm Capital Economics has warned.  Economist
Martin Beck, who recently joined the firm after 12 years with HM
Treasury, said: "We think that Scotland's exit from the Union
would be unlikely to benefit the rest of the UK (rUK) and could
even represent a net economic cost. The UK would probably retain
some of the disadvantages of current links with Scotland,
including the need to continue acting as a backstop to the
Scottish financial sector, but independence would offer few
benefits, at least in the near-term."  Writing in Capital
Economics' latest UK Economics Focus on Tuesday, Mr Beck said
the direct fiscal consequences of independence to the UK would
probably be minor, but that the monetary conseque