It is never great long-term politics to trumpet a set of figures that are likely, at a later date, to come back and bite you.
The SNP made that mistake in recent years by highlighting GERS figures that showed Scotland in a positive light, and deserve to learn a lesson now that the politics of GERS have inverted.
I am not convinced, however, that this week’s GERS figures (Your report, 25 August) represent a structural weakness in the case for independence.
First of all, the figures themselves are flimsy. The GERS figures were established by a Tory secretary of state for Scotland who, in the pre-devolution context, sought political advantage in their creation. They represent only a very rough guide to the health or otherwise of Scotland’s finances.
But let’s accept the figures and consider them at face value. They represent an attempt to capture two key numbers: total tax revenues in Scotland, and total government expenditure. The gap between the two is this week being presented as “Scotland’s deficit”. When this gap becomes relatively wide, as is the case this week, Scotland is often presented as somehow “not a viable independent country”.
This is simply nonsense. It is widely accepted – even by pro-Union campaigners – that Scotland’s tax revenues per person (even without any contribution from oil) are broadly similar to those of the UK as a whole and substantially higher than those of most independent EU nations. Scotland’s starting point is therefore a tax base that makes it every bit as viable as the UK. Its potential to be a successful independent nation is not in doubt.
The interesting aspect of Scotland’s ‘deficit’ in this week’s GERS figures lies not in unusually low tax revenues but in unusually high levels of public expenditure in Scotland, at around £1,400 per person higher than the UK average. Is it realistic (and fair) to expect this to continue in the medium term?
It seems to me that some re-adjustment of public sector spending in Scotland is likely in the medium term, whether we become independent or not. Scotland is wealthy, but like anywhere else its resources are limited. Independence would, at least, allow us much greater choice in terms of the taxes we raise, the policies aimed at increasing those resources, and the priorities towards which they are directed.
Glenorchy Road, North Berwick
The First Minister’s response to the damning GERS report is to blame Scotland’s dismal economic woes on the oil price fall and to assert that Scotland’s economy is, notwithstanding, strong.
However, even assuming as correct the SNP’s 2014 pre-referendum forecast of £7.9bn a year from oil 2015-16 (others were forecasting £1.5-3bn), the deficit would still be £6.9bn ie approximately 4.3 per cent of GDP so that you have to have ludicrously-optimistic oil tax revenues to bring the Scottish budget deficit down to a half-reasonable level.
Even if oil revenues were a highly optimistic £3.8bn a year, that would put Scotland’s deficit on a par with Greece’s at 7.2 per cent of GDP.
Hew R Dundas
St Colme Street, Edinburgh
Before the Scottish Referendum, Nicola Sturgeon said we were “on the cusp of a second oil boom”. Sadly the industry has in fact collapsed since then, with £8 bn of revenues lost. I would love to see the First Minister apologise for this Nigel Farage-style promise.
However, given how unlikely that is I would at least like her to spell out which taxes will rise after independence and which benefits will be cut. Will she follow the role model she regularly uses of Ireland and Norway and increase VAT to 25 per cent and raise income tax to 30 per cent?
Will she follow the model of Ireland and introduce charges for going to A&E, visiting your GP and staying overnight in hospital or will she shut hospitals and centralise services to save money? Which welfare benefits will she cut – winter fuel payment or prescriptions because she can’t keep both.
Dalry Road, Edinburgh
What an eventful day for our First Minister. The latest Government figures (GERS) were unveiled and show that Scotland’s budget deficit has grown in 2015 - 2016 to £14.8bn.
This is 9.5 per cent of GDP (the UK’s deficit is 4 per cent) and is even higher than the current deficit in Greece.
The EU limit is 3 per cent of GDP for any country wanting to join, so that particular objective seems a bit of a pipe dream.
On top of these dreadful figures, Audit Scotland has revealed that the number of students attending Scottish colleges has fallen by 41 per cent in the past eight years.
The SNP government hasn’t yet told us whose fault this is but it might have something to do with the number of institutions falling from 37 to 20 between 2011 and 2015 as a result of an SNP government programme of reform.
But yesterday wasn’t all gloom and doom. The First Minister appeared on the BBC’s One Show outlining her programme to encourage children to read. An excellent initiative as long as the children don’t expect an easy time when they want to go to college in a few years time.
Winton Gardens, Edinburgh
Most of us have low expectations of politicians. But Nicola Sturgeon’s rhetoric since the EU referendum and up to publication of GERS data, has plumbed new depths.
First, true Scotland voted differently in June to England but the majority voted to remain in the EU not, as Nicola Sturgeon implies in a tortuous non-sequitur, to leave the UK.
In a cynical attempt to wring further division out of Brexit, Sturgeon presents herself as the saviour of EU citizens in Scotland, ignoring that no-one suggests they leave and Theresa May expresses her determination they should stay.
Then how can Sturgeon claim Brexit would cost us as much as £11.2 bn without having any idea what the UK’s post-Brexit global trade deals will be?
And now she appears to be in denial that her own government’s GERS numbers highlight the disastrous financial position an independent post – oil boom Scotland would be in.
Plus Scotland’s fiscal deficit is 9.5 per cent – three times the acceptable rate to join the EU.
The reality is Sturgeon is a single-issue politician. Everything else is subjugated to her UK break-up dreams. That we would suffer a massive cut in our standard of living apparently is a small price to pay for making Sturgeon’s dreams come true.
Royal Circus, Edinburgh