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'Scotland £2k Better Off Under Independence'

(c) Sky News 2014

Scotland will be £5bn a year better off in 15 years time if it becomes independent, First Minister Alex Salmond has claimed.

Mr Salmond made the claim as he presented his financial case for independence - as the UK Treasury presented its own, competing economic assessment.

The First Minister also claimed that Scotland's finances in 2016-17 will be similar to, or stronger than, both the UK and the G7 industrialised countries as a whole.

He said: "Scotland is one of the wealthiest countries in the world, more prosperous per head than the UK, France and Japan, but we need the powers of independence to ensure that that wealth properly benefits everyone in our society.

"That wealth means we will start life as an independent nation with strong finances and huge economic potential.

"The latest figures show that by using the powers that only independence will bring we can deliver an independence bonus with increased revenues for Scotland."

However, the Treasury has put the start-up cost of an independent Scotland at £2.7bn.

Chief Secretary to the Treasury Danny Alexander said under independence Scottish people would have to work an extra two weeks before they stopped paying tax and started earning for themselves. Tax Freedom Day for the UK this year is today.

Mr Alexander was making a speech in Edinburgh to launch the Treasury's economic assessment.

However, he was dealt a blow when the academic behind the research claimed the Treasury had "badly misrepresented".

Patrick Dunleavy, a professor of politics at the London School of Economics (LSE), says that when Treasury officials used his research to calculate the start-up costs of independence, they overstated the figure by 12 times.

Officials had briefed that, partly based on the research of Professor Dunleavy, they estimated the start-up costs for an independent Scottish Government at £2.7bn.

It was a calculation of how much it would cost to set up 180 government departments, in line with recent equivalent costs in Whitehall.

The Scottish Government strongly criticised the figure, saying it would not need anything like 180 departments and that much of the departmental infrastructure was already in place in Scotland.

The Professor himself echoed the view.

He wrote on Twitter (NYSE: TWTR - news) : "UK Treasury press release on Scotland costs of government badly misrepresents LSE research.

"Appears to take minimum Whitehall reorganisation cost of £15m and multiply by 180 agencies to get £2.7bn. Overstates maybe 12 times?"

Later, he tweeted: "Could they be this crude? Phone call from Treasury guy later confirms: Yes, they had been."

Scotland's First Minister Alex Salmond has demanded the Treasury withdraw the figures and apologise.

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