GERS: a snapshot of Scotland’s finances – not the full picture

Tomorrow sees the publication of the annual Government Expenditure and Revenue Scotland (GERS) figures for the most recent financial year.

The figures give estimates of overall public spending and taxes raised in Scotland over a 12-month period.

What they emphatically do not give is a picture of the finances of an independent Scotland.

That of course does not stop unionist politicians misusing the stats every year to try and discredit the case for full self-government.

That in itself is ironic given that, historically, GERS figures have consistently shown that Scotland contributes more tax per head than the UK average, and in many  years have demonstrated stronger public sector finances than the rest of the UK.

That picture has evolved of course given the recent impact of low global oil prices and the knock-on effect on Scotland’s offshore sector and our wider economy.

But there have been some encouraging signs for the North Sea industry in recent times.

And recent data on economic growth and unemployment – Scotland is performing better than the UK on both these key measures – gives cause for optimism.

We will see what tomorrow’s GERS figures say about public finances and Scotland’s notional profit and loss account.

That word notional is important.

Because while unionist politicians use GERS to talk about “Scotland’s deficit”, that is a misleading use of the figures.

Firstly, GERS gives a snapshot of Scotland’s public finances under the constitutional status quo – not independence.

The figures used factor in UK Government spending choices – for example on Trident – which would be entirely different under an independent Scottish Government.

And secondly, GERS is based on a range of estimates and assumptions which cannot necessarily be applied to an independence scenario.

The contrast with oil producing Norway for example is stark. Managing its own resources, and not constrained by economic polices made elsewhere, Norway shows what Scotland could be under full self-government.

Whatever tomorrow’s figures show, there is one other important thing to add to the mix.

That’s because – for the first time – we now have GERS-like equivalent figures for all of the nations and regions of the UK.

Published recently by the UK’s Office of National Statistics (ONS), the picture they show is deeply revealing.

Unionist commentators would have people believe that GERS shows Scotland as having the worst fiscal balance in the UK.

The ONS analysis nails that lie once and for all.

It shows that Scotland performs ahead of several English regions and in line with the UK average outside of London and south-east England.

And what it further reveals is the huge extent to which the UK economy as a whole and the comparative figures for all nations and regions is skewed by London and the south-east.

That gross imbalance is an issue for the whole of the UK, not just Scotland.

And of course wider economic picture is dominated now by the looming threat of the Tories’ extreme Brexit plans and the danger it poses for jobs, investment and living standards.

GERS offers a snapshot of Scotland’s public finances – but it is far from the full picture.


Ivan McKee is SNP MSP for Glasgow Provan.