Another Salmond fail: The SNP’s tax and spend figures don’t add up


 

Putting aside the bluster and bellicose rhetoric that is likely to be at the heart of Alex Slamond’s speech to the SNP faithful at their annual conference tomorrow, if he is to have any chance of realising his dream of an independent nation he will need to make a persuasive case the Scottish people would be economically better off by leaving the UK.

Alex-Salmond-SNP-ConferenceIn opening the party’s conference in Perth yesterday, the SNP leader sought to continue with the argument Scotland is a net contributor to the UK as a sign an independent Scotland would indeed be somehow richer.

He declared:

“At the last count, Scotland received 9.6% of the UK’s taxation, and received 9.3% of the UK’s spending. That gap is £2.7bn, 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 that 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.”

Looking deeper at the figures, however, reveals that whilst as a percentage, Salmond’s case might be true, when looking at actual amounts spent, Scotland ends up being a net beneficiary from its membership of the union.

On revenue received from Scotland, the Scottish government’s official expenditure and revenue statistics, known as GERS, for 2010-11 (published in March this year), puts the total figure at £53.1 billion – which equates to 9.6% of the total UK tax take.

The GERS report explained:

“In 2010-11, total Scottish non-North Sea public sector revenue was estimated at £45.2 billion, (8.3 per cent of total UK non-North Sea revenue). Including a per capita share of North Sea revenue, total Scottish public sector revenue was estimated at £45.9 billion (8.3 per cent of UK total public sector revenue).

“When an illustrative geographical share of North Sea revenue is included, total Scottish public sector revenue was estimated at £53.1 billion (9.6 per cent of UK total public sector revenue).”

On spending, however, whilst the figures do indeed show Scotland received 9.3% of all UK-wide public spending, this amounts to £63.8 billion.

As the GERS report notes:

“In 2010-11, total public sector expenditure for the benefit of Scotland by the UK government, Scottish government and all other tiers of the public sector, plus a per capita share of debt interest payments, was £63.8 billion. This is equivalent to 9.3 per cent of total UK public sector expenditure.”

By being part of the UK therefore, Scotland receives £10.7 billion more than it pays in.

Meanwhile, as Salmond also insisted yesterday that the party is the closest it has ever been to achieving its dream of independence, new polling by IPSOS Mori for the Times does not bear this out.

With the polling period for the regular Scottish Public Opinion Monitor having finished on Monday, the very day Alex Salmond put his name on the document that established the framework for a referendum, IPSOS Mori’s figures show:

• Of those who indicated that they are certain to vote in the 2014 referendum, 30% agreed that Scotland should be an independent country, down 5 points since June and 9 points down since January. Support for the Union meanwhile has increased, as 58% of Scots said they would vote ‘No’ in the referendum, an increase of 3 points since June and eight points since January. Twelve per cent of respondents said they were undecided, up 2 points since June;

• Asked about voting intentions for the Scottish Parliament, Labour has managed to reduce the gap with the SNP to 5 points. The SNP are on 40% among those certain to vote, down 5 points since June, and Labour on 35%, an increase of 3 points over the same period. This represents a ten-point swing in favour of Labour since IPSOS Mori’s poll in December 2011. The Conservatives are on 13%, up 1 point from June, with the Liberal Democrats on 8%, up 2 points since June;

• Alex Salmond continues to be the most popular leader in Scotland as half of respondents said they are satisfied with his performance. However, his net satisfaction rating has fallen from +35% in December 2011 to +10% in this poll;

• Scottish Labour leader Johann Lamont’s recent speech on universal benefits has done little to boost her standing among Scottish voters. Just 35% are satisfied with her performance as leader while 30% are dissatisfied. This represents a net satisfaction rating of +5%, which has fallen by 4 points since June. Of particular concern will be the fact a third of Scots felt unable to rate her performance, the same as IPSOS’s poll in June;

• Interestingly, since IPSOS’s June poll, the only leader to have seen their net satisfaction ratings increase in Scotland is David Cameron – he is up 11 points.

Outlining the scale of the challenge the nationalists now face, Christopher McLean, senior research executive with Ipsos MORI Scotland, explained:

“Now that the process for the referendum has been agreed and the real debate can begin, this poll highlights the considerable challenges facing the ‘Yes’ campaign. At the turn of the year, support for independence was increasing and touching 40%. That momentum appears to have been lost and the level of support for independence has returned to its historical average.

“On the other hand, although the ‘Better Together’ campaign has a healthy lead, the poll shows that they cannot afford to be complacent, particularly given that more than one in ten Scots remain undecided.”

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  • http://garve.scott-lodge.com Garve Scott-Lodge

    This isn’t complicated, so please try to keep up.

    You say that “By being part of the UK therefore, Scotland receives £10.7 billion more than it pays in.”

    That is correct. Where does this £10.7 billion come from? It is borrowed by the UK govt.

    The UK as a whole raised £553bn in income, but spent £686bn in expenditure. The UK as a whole was therefore £133bn in deficit. That is, 19% of the UK’s expenditure was borrowed.

    Scotland raised £53bn in income, but spent £64bn in expenditure. Scotland was therefore £11bn in deficit. That is, 17% of Scotland’s expenditure was borrowed.

    Both the UK as a whole, and Scotland are spending more than we’re bringing in, but Scotland’s economy is LESS in deficit than the UK’s.

    The only way in which the ‘extra £10.7bn’ is a benefit of the union to Scotland, is if you assume that we don’t have to pay it back. Sadly, whether as part of the UK, or as an independent country, we will have to pay back our share of the debt.

    Therefore the figures you quote are an argument FOR independence, not against.

  • http://www.facebook.com/profile.php?id=100001102865655 John Ruddy

    The only way they are an argument for independence is if you assume we are going to spend £10billion less in an independent Scotland. So what are you going to cut?

  • http://garve.scott-lodge.com Garve Scott-Lodge

    Nonsense. As part of the UK, we borrow money, and we pay it back. Scotland pays back it’s share of borrowings. As an independent country we’d borrow money, and we’d pay it back – that’s what most countries do.

    We are already paying our share of the UK’s overall debt. After independence we’d take that share with it and continue to service it, just as rUK would service its share.

  • http://www.facebook.com/profile.php?id=100001102865655 John Ruddy

    So what are you going to cut to spend £10bn less?

  • Newsbot9

    Yes, so you’re arguing that you’re talking on a larger debt repayment, AND you’d have to cut spending.

  • Brian S.

    What’s the justification for this anti-independence stance by your organisation? Can’t you imagine an independent Scotland that is more left-wing than England? It shouldn’t be too difficult, given the possibility of (New) Labour getting into power in England, the ‘we’ll give you Austerity as well, but slowly’ party.
    I’m Scottish by the way – are any of you bunch Scottish?

  • http://www.facebook.com/people/Elliott-Steven/100002291304669 Elliott Steven

    “”””””””””””Another Salmond fail””””””””””””””” Gibberish of courseby Brit nats posing as so-called left-wing people. In truth just a complacent Labourite trudging the latest party line.

    What would be the first one? He is the most successful politician since WWII to the extent he has won control of Scotland’s parliament and is considered to be a fine statesman representing the interess of the Scottish people.
    As far as maths go — not your strong point.
    £10.7 BN is the deficit figure — true, that however is about a 10% share of the UK overall budget deficit.
    That £10.7 BN includes a large amont of expenditure on many projects such as Trident nukes that Scotland either doesn’t want or as wioth the army (charged £1.2 BN more than we receive) doesn’t benefit from but is obliged to pay for.
    Does that matter? Yes, because we’re payng for that deficit with cuts to publc services — IOW, we’re being billed twice. Once in our budget and twice with cuts.
    A more telling and clearer picture is the GDP deficit: with North Sea Oil (territorial share), our deficit is ostensibly 7.4% compred to a an English budget deficit of 9.4% and that goes up to 9.7% without Scotland’s oil.

    These figures are very negatively skewed to darken the Scottish budget position and don’t take into account 2 other important aspects: 1) £16.7 BN in private cash flowed out of Scotland gaining tax for the UK, vat for the UK, loans and investment for the UK — all this should be registered in Scotland; 2) An independent Scottish government’s first motivation is to create economic wealth and prosperity — with such a government able to wield the levers of economic power, it is a certainty that Scotland would quickly prove to be an economic powerhouse wrt its population size.
    Moreover, Scottish society will be built on social care and equality.
    Remember that last sentence — with this article, you take a poor and unimaginative swipe at Scottish independence you think… in reality, you are simply pushing the right-wing English political model on the Scottish people. Shame on you.

  • llewpun

    Ah, an another Britnat centralist assimilationist site under the guise of being socialist.

  • llewpun

    Ah, another Britnat, assimilationist, site under the guise of being socialist.

  • http://www.facebook.com/people/Elliott-Steven/100002291304669 Elliott Steven
  • http://www.facebook.com/people/Richard-McHarg/100001198354455 Richard McHarg

    I was going to tackle these ridiculous claims in this article, but I see that Elliot Steven has done a sterling job!

    Scotland’s spending priorities as an independent nation cannot be compared to the current spending of the UK, particularly where so much of the ‘expenditure’ is done so on our ‘behalf’, meaning simply that a lot of expenditure is allocated to Scotland but not actually spent here.

    The GERS figures are not a true account for Scotland. No such figures exist, suffice to say that many Scottish revenue sources are allocated to the London account. GERS always under-estimates revenue raised and over-allocates expenditure. It’s actually quite obvious to the analytical mind!

    Equally, you cannot make claims re Scotland’s economic position in isolation, but must also do the same for those of the rest of the UK. Perhaps you can do an article on England’s economy outside the City of London?

    The main thing here is that a Scotland governing itself would put all its economic and political might behind growing our economy for our nation’s benefit, and not that of a parasitical Westminster ruling class.

    If you are actually socialists, you must be aware that socialism in the UK is a forlorn hope. Not one of the main Westminster parties comes close to socialism; each of them pandering to the aforementioned ruling class.

    You Guys really should be careful what you are printing. We are
    light-years ahead of you in knowledge and information and we believe
    that Scotland will be better run by the people who live here. Pretty
    simple really.

  • http://www.facebook.com/people/Richard-McHarg/100001198354455 Richard McHarg

    Incidentally, from a users point of view, light grey text on a black background is not good. I know a couple of talented web-designers who could make more of your site! And yes, they are two young entrepreneurial Scots who are voting ‘yes’ in 2014. They know that business flourishes where the market exists and that borders are not barriers to trade and economic growth.

  • Gavin Cook

    john are you seriously suggesting that an independnet Scotland uniquely amongst nations would not be allowed to borrow? that is just silly. The whole point is that an Independent Scotland would have to borrow less than its proporttion of what the Uk borrows, simples

  • Gavin Cook

    No hes arguing that an Independent Scotland would have to take on a smaller debt repayment to teh tune of £2.7bn

  • Newsbot9

    Yes, magic! No, debt apportionments among splitting states haven’t worked that way since the era of the Holy Roman Empire.

  • Gavin Cook

    Aye right !!!

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