When simply considering current finances, Welsh independence looks feasible, but it is when you consider the settlement of capital assets that things start to look interesting.
There is an international law called the Vienna Convention on Successor States which to summarize states that:
Wales is entitled to receive, at no cost:
- all immovable UK assets (eg buildings) on Welsh soil (at no cost)
- an equitable share of all movable UK assets (eg gold reserves, military hardware etc) in line with its contributions towards them (ie taxes paid)
- an equitable share of all UK assets overseas (eg embassies)
- an equitable share of national debt,but taking into account the transfer of assets and its associated debt
There would need to be some horse-trading of assets and debt, and it is likely that Wales will only take possession of say 3% of UK assets, but also only 3% of debt. This is very significant, as it would not only reduce national debt repayments but would have a direct impact on current expenditure, as it would reduce depreciation and interest payments.
UK budget depreciation was £15.7 billion in 2003/04, which would represent a cost to the Welsh budget of £0.8 billion if 5% of assets were transferred, but only £0.5 billion if 3% of assets were transferred. There would also be a corresponding reduction in interest payments across all departments, which would reduce projected expenditure by around £0.5 billion, to £20.0 Billion
Ok, if you are still following these threads, I predict that the Current budget for an Independent Wales (based on 2003/2004 figures) would look something like this:
Revenue - £20.4 Billion
Expenditure - £20.0 Billion
Nett Revenue - £0.4 Billion
Less Depreciation - £0.5 Billion
Surplus(Deficit) - (£0.1 Billion)
OK, these figures do not quite break even, but the deficit of only £0.1 Billion has to be compared with the current UK deficit of £21 Billion which is equivalent to £1.0 Billion for Wales.
To those of you who question whether we could afford an independent Wales - I respond how can we afford not to!!