What I can share quickly is the raw data analysis, graphs and headlines.
There are no surprises for anybody who has followed my previous blogs or simply been paying attention.
- As expected the Scottish deficit per capita continues to be worse than the rest of the UK to the tune of about £900 per head (or £4.75bn)
- In only one of the last 5 years has Scotland's deficit been lower than rUK's and then only marginally (£140) - that was of course the year on which the Independence White Paper case was founded
- Longer term average deficit per capita is higher for Scotland than rUK: by £260 over the last 10 years and by £440 over the last 5 years
- We already know that 2014-15 will be worse again due to known oil price collapse
- rUK have consistently reduced their deficit per capita over the last 5 years
Some points worth noting
- I show figures versus "rest of UK" (rUK) i.e. UK excluding Scotland as I believe that's less confusing and more insightful than comparing us to the total UK which includes us. [I still show total UK for comparison purposes in the table at the foot of this post because those figure are so widely quoted]
- I think Per Capita comparison are appropriate when looking at our deficit versus rUK - debt interest is allocated on a per capita basis and during the indyref the default assumption for debt allocation was to base it on population share. If we are being apportioned debt on a population basis it makes sense to see what our per capita contribution to that debt (as a result of running a deficit) is. [I show % GDP numbers below]
- There have been some major restatements (by HMRC and Scottish Government) for prior years (for reasons that are too tedious to document here) - so I have updated the historic figures appropriately
- I've extended to a 10 year time series because it helps us understand longer term trends and volatility (and because the GERS data tables make this easier to do now!)
For those who like to see Deficit/GDP figures this trend is show below.
Even using the SNP's preferred deficit/GDP measure Scotland is running a materially higher deficit than rUK in recent years and has been doing over both a 5 year and 10 year average period.
[The headline impact of historical restatements (by Scot Govt and HMRC to match European System of Accounts) seems to have been to (relatively) boost rUK's GDP. I haven't dug into this further yet]
Stepping back from the rUK comparisons and looking at the absolute figures for revenue generation in Scotland: the total stack is public money spent, up to the black line is from taxes, the balance in red is deficit;
The numbers may be hard to read - but basically increases in revenue raised through employment taxes and VAT have been offset by decline in oil & gas revenue. Remember we already know next year's figures (to be published in March 2016) will show a further £2bn+ drop in oil & gas revenue.
Looking at where the money was spent: the black line represents what was raised in taxes, anything above that is deficit
What strikes me about this graph is that education spending has decreased in cash terms over a period in which (for example) health and social protection have increased by 10%. The Capex vs Depreciation figure declined last year suggesting a slowing of the capital investment program. Clearly these are just superficial observations at his stage.
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Here are the underlying figures for the deficit graphs for those who like to dispute them
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