FURTHER papers setting out economic opportunities for an independent Scotland will be published after vital research debunked the myth Wales was too poor to go it alone, the Scottish Government has said.
Key analysis by Dublin City University found the fiscal gap in the early days of an independent Wales would be a 'fraction' of what has previously been assumed from UK Government data.
Figures from the Office for National Statistics (ONS) are often quoted as suggesting the deficit an independent Wales would incur on day one would be £13.5 billion.
But groundbreaking research by Professor John Doyle has concluded the fiscal gap – the difference between raised revenue and government expenditure – would actually be £2.6bn.
Plaid Cymru – who commissioned Doyle for the research – believe the “game-changing” research will significantly advance their argument for self-determination.
Pro-indy GERS promises
The Scottish Government has repeatedly pledged to produce a similar piece of work to counter the contentious Government Expenditure and Revenue Scotland (GERS) figures, which are often used by Unionists to suggest Scotland is better off in the UK.
Finance Secretary Kate Forbes and her predecessor Derek Mackay have both outlined their commitment in the past to publishing an alternative economic case for independence alongside GERS, but this has not yet materialised.
However, following research being carried out on Wales’s situation, the Scottish Government has said papers are on their way which will set out the economic opportunities that will come with independence.
A Scottish Government spokesperson said: “We have recently published detailed evidence showing how the UK has both lower national income per head and higher inequality compared with independent countries similar to Scotland.
“We will publish further papers setting out the economic opportunities that come with independence as well as reinforcing our commitment to fiscal sustainability in an independent Scotland.”
Two papers setting out the case for an independent Scotland have already been released by the Scottish Government and another "five or six" - according to business minister Ivan McKee - covering other topics are on the way in the next few months.
Scotland has had similar issues to Wales
The GERS figures for 2021/22 suggested Scotland had a deficit of £23.7bn.
But the Scottish Government has highlighted they do not accurately show what an independent Scotland would look like, only what its fiscal position currently is as a devolved government of the UK, with 74% of revenue and 37% of spending reserved.
And the research carried out by Dublin City University further suggests the deficit an independent Scotland will incur may in fact be dramatically less than what is so often quoted.
Alternative GERS could be a 'game-changer'
Chris McEleny, general secretary of the Alba party, said the Scottish Government should dedicate time to producing alternative pro-independence GERS figures.
He said: "Currently, the Scottish Government has a team working on a series of independence papers but these have to date been high level and thematic in nature which haven’t been of much use, if any, to activists on the ground.
“The Scottish Government would be better to dedicate time to producing an alternative set of GERS figures that strip out expenditure on policies such as Trident and its renewal, HS2, Hinckley point, the cost of borrowing to provide tax breach for the richest in society, as well as the UK's decision to target 3% of expenditure on GDP.
"Alternative GERS [figures] that discount the worst of UK mismanagement of expenditure, and take into account the different priorities an independent Scotland could have agency to enact in these areas, would be a complete game changer in challenging Unionist attacks."
The £13.5bn figure in Wales – frequently quoted as representing the UK Government’s annual subvention to the country – is based on taxation paid by people and companies who are resident in Wales, a public expenditure spent in Wales, and “crucially” a per capita contribution allocated to Wales of all central UK expenditure.
But from analysing the main components of the fiscal gap – including pensions, UK national debt repayments, and defence spending, together with under-estimates of Wales’s share of tax revenues – Doyle found the elements of these that would likely transfer to an independent Wales would amount to around £2.6bn.
Doyle has previously worked on the fiscal outlook for Northern Ireland in the context of a reunified Ireland and his work has contributed toward Plaid Cymru’s submission to the Commission on the Constitutional Future of Wales.
