Scotland the broke

Deficit hits £15bn – as Scots enjoy £1,600 more per head of UK tax cash

‘Massive setback for separation’

SCOTLAND’S deficit soared last year – dealing a ‘hammer blow’ to the SNP’s independence plans, the Tories said.

And those north of the border benefited from £1,600 more public funding per head than the rest of the UK.

The Scottish deficit grew to £15.1billion, or 8.6 per cent of GDP in 2019/20, up from 7.4 per cent the previous year.

Britain’s deficit as a whole was much lower at 2.5 per cent, up from 1.9 per cent the year before.

Scottish dependence on the UK taxpayer was underlined by figures showing that public spending in Scotland, by both the UK and Scottish Government, rose by 3.1 per cent to £81billion.

This is equivalent to £14,829 per head, while the figure is £1,633 less for the rest of the country.

The figures are from an annual report named the Government Expenditure and Revenue Scotland (Gers), which gives a detailed account of how public money is raised and spent in Scotland.

Scottish Conservative finance spokesman Murdo Fraser said: ‘This is a hammer blow to the SNP and a massive setback for separation.

‘Nicola Sturgeon would have to throw away Scotland’s entire NHS, every nurse and doctor, just to come close to balancing the budget in her separate state.

‘It’s beyond dispute that the economic case for independence has never been weaker.

‘ Separating would cost Scotland £15billion a year that we need for our schools and hospitals.’ But Scottish finance secretary Kate Forbes of the SNP drew the opposite conclusion.

She said: ‘Although Gers is not the Scottish Government’s budget and reflects the current constitutional arrangements whereby another government’s policy choices are allocated to Scotland, the publication sets out the context for why the status quo and the present constitutional arrangements are unsustainable.’ Reiterating her call for the country to have further financial powers, Miss Forbes said it was ‘ incredibly frustrating’ that Scotland could not borrow to invest in recovery.

She added: ‘ Based on these figures, nobody can or should defend the status quo of the current constitutional arrangements.

‘Instead, this publication once again strengthens calls for additional fiscal and economic powers to manage our public finances in a sustainable way and invest in recovery.

‘Scotland simply cannot afford not to have the powers of a normal independent country.’

While the Gers figures incorporate the early stages of the coronavirus pandemic, the report notes the impact will be greater in the next financial year.

Last night, the Institute for Fiscal Studies said Scotland’s deficit could reach 28 per cent in 2020/21 due to the impact of Covid-19.

Associate director David Phillips said: ‘The Office for Budget Responsibility’s central scenario suggests the UK’s deficit could reach almost 19 per cent of GDP this year.

‘And projections based on this suggest Scotland’s implicit deficit could reach around 26-28 per cent of GDP.’