FINANCE Secretary Kate Forbes has underlined the need for Scotland to be independent as she set out new public finance figures.

According to today’s Government Expenditure and Revenue Scotland (GERS) publication, tax revenues increased in 2019-20, although they were impacted by the initial effects of coronavirus (COVID-19).

The report shows that overall revenues, including North Sea receipts, increased to a record £65.9 billion. Onshore revenues grew by £1.1bnto reach £65.2bn.

These increases came despite the pandemic depressing public finances. Corporation and VAT receipts fell compared to the previous year and both the Scottish and UK governments increased spending to tackle the virus.

As a result of this Scotland’s notional onshore deficit – the difference between income and expenditure – rose 0.6% to 9.4% of GDP, the same rate of increase as the UK.

Taking account of North Sea revenues which totalled £724 million – £642 million less than in 2018-19 – the notional overall deficit stood at 8.6% of GDP.

Finance Secretary Kate Forbes said the figures emphasised how Covid-19 had fundamentally changed the fiscal landscape.

"The Scottish Government has responded swiftly to the challenges of COVID-19 and has worked hard to protect Scotland’s economy, providing over £2.3bn of support to businesses," she said.

"The public finances were already facing challenges this year due to the uncertainty caused by Brexit. We are now witnessing an unprecedented health and economic crisis. Countries across the world, including the UK, have increased borrowing to record levels and, as we emerge from the pandemic, high fiscal deficits will inevitably be one of the consequences.

"That is why the UK Government should prioritise economic stimulus over austerity. I will also continue to press for the Scottish Government to be granted additional financial powers to enable us to tailor a response that meets Scotland’s needs."

READ MORE: Kate Forbes: Independent Scotland could have dealt with Covid crisis

She added: “Scotland, unlike most other countries around the world, large and small, does not currently have the full financial powers needed to chart a way to sustainable recovery from the economic impact of the pandemic. The current situation, with the looming withdrawal of furlough support by the UK Government, means it is now more urgent than ever that we gain those powers.

“Despite the pandemic, and the economic problems that inevitably will arise at the end of the Brexit transition period, we are determined that Scotland should emerge with a stronger, fairer, greener, and more resilient economy. We continue to invest to protect and create jobs, support businesses and strengthen communities, but our ability to do that is constrained by our lack of borrowing powers.

“It is important to stress that 40% of spending and 70% of revenue income in GERS, combined with key powers over the economy, are reserved to the UK Government and outside the control of the Scottish Government.

“An independent Scotland would have the power to make different choices, with different economic budgetary results.”

Commenting on the figures on Scotland's notional deficit, Scottish Greens co-leader Patrick Harvie called for a radical financial rethink to combat the pandemic, Brexit and the climate crisis.

He said: “Both sides of the constitutional debate try to seize on the annual GERS figures, but this is an unhelpful fixation on figures that don’t mean very much.

“GERS tells us little about what an independent Scotland’s finances would be like, or even about the finances of the devolved Scottish Government we have today. They are also wildly out of date because they do not reflect the impact of the Covid crisis.

“In fact, we now face a triple economic crisis of Covid, Brexit and the Climate Emergency, and it is dangerous to keep a narrow focus on reducing the deficit, especially when this approach has already led to rising child poverty and record levels of hunger and homelessness in the guise of austerity.

“Now more than ever we need to ditch the failed old economics that has forced people into poverty and done such profound damage to our planet. Unlike the SNP’s Growth Commission, which would continue this austerity-driven race to the bottom with the rest of the UK, the Scottish Greens believe independence must come with a determination to build a future for all in a new greener Scotland.”