There is an idea that all that matters in Scotland is big constitutional change and that the Scots control this process. It is a dangerous illusion. Behind the song and dance of referendums lie real economic forces that will change Scotland no matter.

A report out this week confirms what policymakers have long known – public spending in Scotland can only go down in the short- to medium-term, and urgent reform of how services are delivered is necessary.

The Fraser of Allander Institute, part of Strathclyde University, has recently appointed Graeme Roy as its director – he was an economic adviser to the Scottish government from 2007 to 2016. This is important, as he knows both the shape of the economy and how it has been groomed for public consumption.

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In his latest report, he projects a worst case £1.6bn of public cuts by 2020/21. That is 6% of what the Scottish government spends. Given the NHS and some other budgets are protected, he suggests other areas of spending could be cut by 17%. Roy speculates that the most likely place for this to happen would be the local government budget.

The factors leading to this gloomy prediction are two-fold. The first is the continued austerity programme of the UK, which will see downward pressure on all public spending. The second is the transfer of tax-raising powers to Scotland. In the process of gaining responsibility, Holyrood has also acquired risk. With powers to raise 50% of what it spends, the Scottish government may see income fall if the economy performs badly.

Roy reasonably attributes low economic performance in part to the Brexit vote, but that is not the only factor at play. Global sluggishness and borderline deflation are threatening many economies and Scotland is no different. Wherever you turn, there is bad economic news. In previous statements, Roy and the Fraser of Allander are clear that in the event of independence there would be a deficit of around £15bn. Oil revenues have crashed, economic growth lags the rest of the UK and Scotland still runs a large public sector on relatively low taxes.

Should Scotland opt to stay in the UK, as looks most likely, then the chances of the existing financial deal between London and Edinburgh lasting much longer look slim. The document protecting Scotland’s funding is entitled “An Enduring Settlement” – a nice sentiment, but probably wishful thinking. The emergence of a British nationalist government under Theresa May, seeking independence from Europe and a return to the good old days of grammar schools, means it is almost inevitable there will be a fresh assault on a deal viewed by many English voters as unfair.

There is a tendency in Scotland to swing from triumphalism to gloom in a heartbeat, yet this is not a case of “we’re all doomed”. The pressure on Scottish public spending is common across Europe. Exceptional levels of debt, demographic pressures and low growth contribute to a sense that the old model of the state is over – RIP 1945-2008. But in the need for change lies opportunity.

If the demand for independence were about anything substantial, it surely rested on the idea that things could be done differently. It was about taking Donald Dewar’s phrase of “Scottish solutions to Scottish problems” to its maximum effect. The problems are mounting and now would be a very good moment for some solutions.

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The Scottish government has toyed with reform. It set up the Christie commission in 2010 to look at how services could be reformed to give better outcomes for less money. The findings were largely shelved. The political cost of radical change is too high for the cautious SNP.

There is important context here – the Fraser of Allander’s headline was part of a budget report, setting out the challenges to spending ahead of the Scottish government’s financial statement. Such a thing is old hat for Westminster, where bodies such as the Institute of Fiscal Studies provide pre- and post-budget comments. In Scotland, no such body has previously existed – the political culture of impartial expert analysis and think-tankery is in its infancy north of the border.

What Roy is trying to do is widen the debate beyond the partisan camps of yes and no, SNP vs Tory. It’s early days and so far it has met with mixed success – most nationalists have used the report to repeat calls for an end to austerity. In time, the introduction of more impartial data will surely lead to a more sophisticated public debate.

The question for the Scottish government, like those across the continent, is whether it has the leadership to guide the state through these turbulent times when radical change is both inevitable and desirable.