Scottish government calculations wrong by £1.8bn

Finance minister John Swinney. Picture: PA

Mr Swinney told the finance committee there had been a “deeply regrettable” error in accounts laid before the Scottish Parliament at the end of last year.

In a letter to the committee convener, he said there had been a “significant factual error” in the pension liabilities reported by the Scottish Government.

Mr Swinney said initially that the estimates for the Scottish Teachers Superannuation Scheme had been “overstated” by £1.2bn.

He went on to say in his letter that the error was later “revised upwards” to £1.8bn.

Mr Swinney insisted that the error had “no practical implications” for pensions of teachers or other public-sector workers and said the public purse had not been affected.

The minister’s letter said that the accounts had been prepared by the Scottish Public Pensions Agency (SPPA).

Mr Swinney blamed the error on Westminster’s Government Actuary’s Department (Gad), which had supplied the original pension figures.

However, Mr Swinney admitted that the error on pensions liabilities had not been discovered until after the Scottish Government had published the figures.

Scottish Tory finance spokesman Gavin Brown claimed the SNP government was at fault for bringing inaccurate accounts to Holyrood, as he accused ministers of failing to carry out proper checks.

He said: “This calls into question the Scottish Government’s competence when it comes to financial matters and making projections.

“To be out by over £1bn the first time and then close to £2bn the second time suggests there are some flaws in the processes.

“I would call on the Scottish Government to be transparent and explain how the problem occurred. Mr Swinney needs to specifically say how the government has sharpened up its act and tell us how the problem has been sorted out.”

The row comes days after Mr Swinney unveiled plans to create a separate Scottish Government economic watchdog following criticism of UK figures.

Nationalist ministers have expressed concerns that the UK-wide Office for Budget Responsibility (OBR) has downplayed Scotland’s economic strength, especially the value of North Sea oil and gas.

Meanwhile, Mr Swinney, in his letter to finance committee convener Kenny Gibson on pensions, talked about the “steps the Scottish Government has put in place to rectify this error”.

He insisted Scottish Government advisers had relied on Westminster figures when the accounts were published.

Mr Swinney said there were “no material implications” for pension funds or the Scottish government’s public-spending programme.

The finance secretary said: “It is a matter of regret that such an error has occurred, but I trust that the committee will recognise the limited practical impact it has had and be assured that the necessary processes are now in place to avoid any recurrence.”

A spokeswoman for Mr Swinney repeated the minister’s claim that UK officials had supplied Scottish Government staff with the incorrect figures on pensions.

She said: “The accounting error was made by the UK-wide Government Actuaries department, which serves the UK government and UK public bodies and as the letter says they have already taken action, prompted by the Scottish Pensions agency to review procedures.”