Meeting of the Parliament 01 April 2015
Not at the moment, Mr Brodie.
We see from Fiscal Affairs Scotland, another expert group, figures for 2019-20. I have given members the likely figure for 2015-16, but I will fast forward to the end of this session of Parliament. According to Fiscal Affairs Scotland, the UK would have a positive fiscal balance of 0.3 per cent of gross domestic product, but if Scotland were to go through full fiscal autonomy it would have a fiscal deficit of 4.3 per cent. The UK would be in the second year of a small surplus of just over £7 billion, but Scotland would have a deficit of over £8 billion by the end of this session of Parliament. What would happen if we were to go for it and were then hit by another fiscal shock? That would be very difficult to cope with. I repeat that we would have to have £8 billion-worth of spending cuts on top of the ones that we are already going to have, or we will have tax increases or increased borrowing.
I do not claim that the Treasury, as part of the UK Government, is quite as independent as the IFS, but I invite the Scottish Government to challenge its figures on full fiscal autonomy. The Treasury has pointed out that there would be a deficit of £7.8 billion in the next financial year and that that would rise to £7.9 billion in 2018-19 and £8.4 billion in 2019-20, which is broadly in line with the estimates of others.
This morning, we heard from Jim McColl, who is a hugely respected businessman and member of the Council of Economic Advisers, who wants full fiscal autonomy. He accepts that there would be a gap. In response to the BBC, he said:
“There would be a gap if you were allocating all these revenues. Yes, there would be”.
That is a direct lift from the BBC website. That should be contrasted with the Scottish Government’s approach. In the same article, it said:
“Scotland already more than pays its own way”.
It did not say that Scotland pays its own way; it said:
“Scotland already more than pays its own way”.
If we look at last year’s and this year’s GERS figures, we see that that is not true.