Scottish Independence: Alex Salmond’s financial claims put under the microscope

Published on 19/10/2012 00:00

ALEX Salmond made a bold claim about Scotland’s finances yesterday. “At the last count, Scotland received 9.6 per cent of the UK’s taxation, and received 9.3 per cent of the UK’s spending,” he said.

“That gap is £2.7 billion, or to put it another way, £1,000 for every family in Scotland. That’s £1,000 that we could spend on vital services. That £1,000 means we could borrow less, we could save for the future, or we could defend the vital services which are part of the social fabric of Scotland.”

So how do the figures stack up? Scottish Government figures confirm that 9.3 per cent of total UK public expenditure was spent in Scotland in 2010-11 compared with 9.6 per cent of the UK revenues (with a geographical share of North Sea Oil included). The 9.3 per cent of public expenditure amounts to £63.8bn. The 9.6 per cent of UK revenue amounts to £53.1bn (the shortfall shows up the fact that our taxes in that year did not cover the cost of Scotland’s public sector – hence the need for borrowing). Scotland had a £10.7bn deficit – amounting to 7.4 per cent of the country’s gross domestic product.

In other words, Scotland (including all the oil) was slightly less broke than the UK in 2010-11. Figures will change from year to year, perhaps drastically, but for that year an imaginary independent Scotland, with the exact same revenue and expenditure base as the real Scotland, would have had to borrow £2.7bn less in order to meet the shortfall, or borrow the same and spend £2.7bn more.