THE ECONOMIC case for independence received a “significant” boost yester-day, Finance Secretary Derek Mackay claimed.
The SNP minister was speaking as new figures revealed that Scotland’s notional deficit had fallen from 8.1% of gross domestic product (GDP) in 2017-18 to 7% in 2018-19.
That’s ahead of the schedule set out in the SNP government’s Sustainable Growth Commission, which had predicted a deficit of 7.1% by 2021.
According to the Government Expenditure and Revenue Scotland (GERS) statement, the new estimated deficit is £12.6 billion – down from £13.4bn last year.
The figures, compiled by Scottish Government statisticians, showed that while public spending in Scotland had increased to £75.3bn, there had also been a jump in the money raised here onshore – up £3bn to £62.7bn.
They also revealed that in the last financial year the amount of money spent by the government and other public services in Scotland was the equivalent to £13,854 per person.
However, that’s around £1661 higher than in the rest of the country.
The amount raised in taxes in Scotland was the equivalent of £11,531 per person, £307 less than the UK average.
The UK Government said this meant every Scot was receiving a £2000 “Union dividend”.
The estimated fiscal deficit for the UK as a whole in 2018/19 was £23.5bn – or 1.1% of its GDP – six times less than that of Scotland. In 2017-18, it had been four times less.
Mackay, who answered questions from journalists during a visit to glamping pod firm Armadilla in Bonnyrigg, said GERS did not “reflect the starting position of an independent Scotland”.
Independence, he added, would “empower” Scotland to “unlock our potential and do even more”.
READ MORE: Fact Check: This is what the deficit mean for Scottish independence and Europe
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He added: “Even under the current constitutional arrangements our economy is getting stronger, it’s threatened by Brexit but with independence we could do so much more.”
“I recognise the estimated notional deficit is not where we’d want it to be, we’d want it to be reduced.
“That’s why the work of the Growth Commission was so important in setting out a plan as to how we would further reduce that deficit.”
There would, the minister added, “be choices we could make as an independent country around what we spend”.
“The fact that we’re raising more in Scotland – we’re raising enough to pay for devolved services, social protection – then I think it shows there are choices we can make around reserved expenditure.”
The Growth Commission, published last year, predicted an independent Scotland would start out with an annual budget deficit of just under 6%. This deficit would then be reduced to below 3% within five to 10 years.
Mackay said spending figures included about £6.5bn on servicing the UK’s debt repayments and defence costs, including Trident.
“We could make different choices, but what the figures are showing even right now is that we can grow our economy more quickly and more effectively, and of course we would want that to accelerate,” he said.
“That’s why I think independence is the antidote to austerity.”
Revenue from the North Sea oil and gas industry increased marginally from £1.42bn to £1.43bn. Excluding oil revenues, the deficit exceeded £14bn, equal to 22.5% of tax revenues.
Tory Scottish Secretary Alister Jack said the GERS figures revealed that every Scot received a “Union dividend” of nearly £2000 a year.
Jack added: “These Scottish Government figures also show there would be a £12.6bn black hole at the centre of an independent Scotland’s finances.
“Real questions need to be asked about the First Minister’s stewardship of the country’s economy.
“With Scotland’s deficit now more than six times greater than the UK average, the Scottish Government needs to take action.”
Scottish Labour leader Richard Leonard said the figures showed that an independent Scotland would have to cut back on public services massively if it wanted to get the deficit under control.
He said: “A stand-alone Scotland would have one of the biggest fiscal deficits in the developed world, and the SNP’s shock treatment plan to close it is by dumping the pound and imposing unprecedented levels of austerity.”
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