North Sea oil and gas revenues rose from £2.4bn to £9.4bn
Scotland’s public spending deficit fell to £19.1bn last year, largely due to higher oil and gas revenues.
The annual Government Expenditure and Revenue Scotland (Gers) report looks at taxes raised in Scotland and public spending for and on behalf of Scotland.
It estimated that the gap was lower than the previous year’s £23.7bn but is still higher than before the pandemic.
The deficit represents 9.0% of Scotland’s GDP – higher than the 5.2% for the UK as a whole.
The Gers report allocated Scotland a “geographical share” of North Sea revenue for 2022-23.
It was £9.4bn, following the introduction of the windfall tax – up from £2.4bn the previous year.
The report said that if North Sea revenue was not included the deficit would have been £28.5bn.
Gers is a National Statistics publication, which is prepared by Scottish government officials independently of ministers.
It sets out revenues raised in Scotland, both from devolved and reserved taxation and public spending on behalf of Scotland.
The difference is called the “net fiscal balance” and often referred to as the “deficit”.
The statistics have formed a key battleground in the debate on the fiscal sustainability of an independent Scotland.
The economic research body The Fraser of Allander Institute said Gers relied on some estimation but that was part of all economic statistics and was not a reason to dismiss the figures as “made up”.
The Gers figures for 2022-23 showed Scottish public sector revenue was estimated as £87.5bn.
Without North Sea revenue this was £78.1 billion – up £8.1bn as income tax, national insurance contributions, VAT, and non-domestic rates grew strongly.
Total spending for the benefit of Scotland was £106.6bn.
It increased by £9.3bn, reflecting increases in debt interest payments at the UK level and the introduction of Cost of Living support.
Before the Covid pandemic Scotland’s public deficit figure stood at £15.1bn – 8.6% of GDP – but more than doubled to £36.3bn, or 22.4% of GDP, in 2020.
It has reduced over the past two years but remains higher than before the pandemic.
