SNP: Scots 'subsidise the rest of UK by billions of pounds a year'

SCOTLAND subsidises the rest of the UK by billions of pounds each year, a report produced by the Scottish Government claims.

• Alex Salmond has called for the Scottish Office to be scrapped. Picture: Getty

SNP ministers – who are expected to unveil their independence referendum bill next week to coincide with Burns Night – have produced a paper in an effort to prove that Scotland is not economically dependent on the UK government.

The study is a rebuttal of one produced by the Scotland Office over Christmas that argued that, even with 100 per cent of the UK's oil revenue, Scotland would have run up a spending deficit of 3.5 billion in 2008-9.

And it attempts to paint the UK government department as "anti-Scottish", deliberately doing the country down to undermine arguments for Home Rule.

The attack comes just a week after First Minister Alex Salmond called for the Scotland Office to be scrapped.

The UK government report noted that Scotland had been in deficit for all but the first nine years of the period from 1981 to 2009, and had run up spending debt of 23.5bn.

This did not include the 37bn paid by the Treasury to bail out Scotland's banks, with the cumulative total of just over 60bn accounting for almost two years' worth of the Scottish Government's annual expenditure.

However, the Scottish Government described this report as "flawed" and

argued that even with 100 per cent of oil revenues the UK made a loss in nine years between 1981 and 2009 compared with Scotland's six.

It also said that Scotland's 23.5bn worth of borrowing was just under half its population share of the cumulative UK debt in that period of 672.5bn, which would have been 56.5bn. It repeated an argument from last year's Government Expenditure and Revenue Scotland (Gers) report that in 2007-8, some 2.3bn more tax was raised north of the Border than spent.

Finance secretary John Swinney also demanded that the UK government produced its calculations to justify its claims.

Prime Minister Gordon Brown has been challenged repeatedly by Nationalists over government claims about Scotland's budget.

A spokesman for Mr Swinney yesterday said: "The Scotland Office would be better known as the anti-Scotland Office, given that its sole purpose these days appears to be to pump out dodgy figures to do Scotland down.

"However, even accepting their methodology, the figures show that Scotland has consistently outperformed the rest of the UK… It is Britain that is bust, not Scotland and these figures prove it."

But a spokesman for the Scotland Office said that SNP ministers were "just going round in circles".

He said: "The first page of the Gers report makes it as clear as day Scotland has a fiscal deficit – to the tune of 11.1bn in 2007-8. Put simply, Scotland is part of the UK and has been able to spend more money than is raised through taxes in Scotland."