The annual report on Scotland’s public finances has sparked an intense row between nationalists and unionists over whether the country punches above or below its weight in the UK economy.
Government Expenditure & Revenue Scotland 2010-2011, commonly known as the Gers Report, was published by the Scottish Government’s chief statistician today. According to Scottish Finance Secretary John Swinney, it shows that Scotland, with 8.4% of UK population, contributed 9.6% of revenues and received 9.3% of spending in return.
He said: ‘Looking at both sides of the balance sheet, over the five-year period from 2006/07 to 2010/11, Scotland was in a stronger financial position relative to the UK as a whole by a total of £8.6bn – over £1,600 for every man, woman and child in Scotland, or over £3,600 per household.’
But his Labour shadow, Ken Macintosh, responded that the report showed that Scotland spent between £11bn and £19bn more than it raised in taxes last year.
‘This shows the huge economic benefits of Scotland working in partnership with the rest of the UK, and explodes the myth that somehow Scotland’s finances are being diddled,’ said Macintosh.
The prospect of an independence referendum in 2014 has intensified arguments over this year’s Gers.
Swinney said the report demonstrated ‘the opportunities of independence and financial responsibility’, Macintosh that it proved ‘the benefit of sharing reward and risks across the UK’.
Their differing interpretations reflect political selectivity in quoting from the report’s mass of statistics, notably on allocation of North Sea oil and gas revenues. A per capita share of these puts Scotland’s fiscal contribution at 8.3% of the UK total. But the report also calculates an ‘illustrative geographical share’, which hikes the contribution to 9.6%.
Scotland’s budget deficit in 2010/11 was £14.3bn (12% of gross domestic product) excluding North Sea revenues; £13.6bn (11.2%) including a per capita share of North Sea revenues; and £6.4bn (4.4%) including a geographical share of North Sea revenues. The UK deficit over the same period, including all North Sea revenues, was £97.8bn or 6.6% of GDP.
The figures for Scotland’s net fiscal deficit were: £18.6bn (15.6% of GDP) excluding North Sea revenues; £17.9bn (14.7%) per capita North Sea; and £10.7bn (7.4%) geographical share. The UK deficit, including all North Sea revenues, was £136.1bn or 9.2% of GDP.
