THE author of a famous report predicting an independent Scotland would amass “embarrassing” wealth as a result of oil has said it has far less relevance today.

Professor Gavin McCrone said the situation had “completely changed”, while plummeting oil prices in the second half of the 1980s meant the massive surplus would not have lasted.

His comments came as the pro-independence National newspaper published the McCrone report, which was written and researched in 1974 as a briefing to ministers before Labour took power, in its entirety.

Prof McCrone, who was then a senior civil servant, told The Herald: “We had a situation in the 1970s when there were enormous oil discoveries going on all the time, and the revenues were going to be very large.

“But today, we are in a situation where the oil is declining in importance and the revenues have come a way down. The price, well – they’ve gone up slightly a bit, I suppose, but they will never be what they were.”

He said his analysis of Scotland’s “embarrassing” surplus would not have lasted, because “the oil price came rattling down in the second half of the 1980s”.

He added: “It might have been the case at the time. I think these things were probably put in my report to make ministers wake up to the importance of the thing.”

The 86-year-old said oil was “still important, but it’s nothing like as important as it was back then”.

Prof McCrone’s 1974 report said the discovery of North Sea oil had “completely overturned the traditional economic arguments used against Scottish nationalism”.

It added: “An independent Scotland could now expect to have massive surpluses both on its budget and on its balance of payments and with the proper husbanding of resources this situation could last for a very long time into the future.”

It said that “for the first time since the Act of Union was passed, it can now be credibly argued that Scotland’s economic advantage lies in its repeal”.

Elsewhere, it stated: “[An independent Scotland] would tend to be in chronic surplus to a quite embarrassing degree and its currency would become the hardest in Europe, with the exception perhaps of the Norwegian kroner.”

The report was classified as “secret” and given a restricted circulation because of the "extreme sensitivity of the subject", and only came to light in 2005 following a Freedom of Information request by an SNP researcher.

Prof McCrone said he was surprised by the totemic place it now holds in Scottish debate as he did not think it would see the light of day, but said he never felt it was hushed up.

He said: “My thing was never intended to be published. It was a confidential report for ministers – these things always are, protected by various rules.”

He added: “I didn’t expect it to be published. I didn’t write it to be published. And I didn’t really expect it to be leaked either – maybe I should have thought it might have been, but it wasn’t.”

He said he was abroad when the report was initially released in full 14 years ago, and was “quite amused” to come back and find it being discussed.

But Prof McCrone said he still believed in setting up an oil fund, even if "you wouldn't have nearly so much to put into it now".

He said such a move in the 1980s would have “made the situation much easier when we got to the financial crashes”.

He said: “The danger when you have a very wealthy resource like that is it crowds out the rest of the economy, of course, and that would have been something that would have had to be faced if Scotland had been independent.

“Norway took measures to deal with that, more or less successfully, but I’m not sure whether Scotland would have done. One just doesn’t know. The UK didn’t really.”

He continued: “I thought Norway were very sensible with what they did. But then they are a different country from the UK.

“Norway is a country with a population about the size of Scotland, and the UK had a population of between 50 and 60 million I think, at that time, and had a lot of problems.

“The 1970s were a very, very difficult period for any government, whichever government was in office, and so it’s perhaps understandable that they just wanted to take advantage of the oil revenues and that was that.”