Facts in deficit and debt

Re Mr Andrew’s letter, `More than about oil’ (News, July 20). His original letter of July 6 was comparing the current balance deficit and I pointed out that according to the Government Expenditure & Revenue Scotland for 2014-15 Scotland’s deficit of £11.9bn (7.8 per cent of Scotland’s GDP) and the rest of the UK was £47.9bn (2.6 per cent of GDP). In his latest letter he has now switched to comparing debt to GDP, stating Scotland is rated the 4th lowest on a table of 162 countries.

There is a big difference between deficit and debt. A deficit is the difference between government receipts ((mainly tax revenue) and government spending (mainly salaries of government employees, social benefits, interest on public debt, in a single year. Whereas debt is built up over the years due to borrowings to cover deficits

Mr Andrew is correct to say Greece has a very large debt and there is a large difference between debt and deficit It’s deficit is comparably low because it had to get the budget approved by the EU central bank and cut back significantly on its spending and raise taxes in order to paid back the borrowing and reduce the deficit otherwise it would have to increase its borrowing.

All borrowings for the UK is done by the UK government therefore the UK debt is for the whole of the UK and only this year has Scotland been given permission to have limited borrowing.

But what we do know that according to the Office of Fiscal Studies if oil revenues to Scotland were discounted we would have a similar deficit as last year for every year for the last 13 years.

So much for oil revenues being a bonus!

Peter Dawson, West Mains