TO use the annual GERS report into Scotland’s fiscal position in the UK to attack the economics of an independent Scotland “is to misuse it”, a leading financial body has warned.
The Fraser of Allander Institute (FAI) – which is based at the University of Strathclyde – told commentators and politicians that the GERS report could not be used to say “anything about an independent Scotland” in a briefing published on Tuesday.
On Wednesday, August 12, the Scottish Government is set to publish the annual Government Expenditure and Revenue Scotland report for the last financial year (up to April 2026).
The report outlines how much tax was raised in Scotland, and estimates how much was spent by the Scottish Government or on its behalf by the UK Government. It also states the difference between these figures – or the net fiscal balance.
Last year, the GERS report said that £26.1 billion more had been spent by or on behalf of Scotland than was raised by taxation within the country.
In one example of Unionist politicians using the figures, the Scottish Conservatives claimed the net fiscal balance was a “Union dividend” worth £2600 per Scottish person – and alleged that the GERS figures “highlight the catastrophic impact Scottish independence would have on the nation’s finances”.
However, the Fraser of Allander Institute has warned that drawing such conclusions is misusing the GERS report.
“To use this figure to say anything about an independent Scotland, in the absence of much-needed specific details about any future constitutional arrangement, is to misuse it,” the institute said.
A briefing ahead of Wednesday GERS publication went on: “Similarly, we won’t learn about how healthy the Scottish economy is – nor should we hope to!
“We already have a wealth of statistics which tell us this – ranging from GDP to earnings to labour market figures. That is not to say that the health of an economy does not impact GERS – often a healthy economy will exhibit a lesser deficit due in part to higher tax receipts – but rather, the net fiscal balance does not provide a single ‘truth’ with regard to the current state of the economy. This is not a weakness of GERS; it is simply not its intention.
“Nor should differences between Scotland’s and the UK’s net fiscal balances be interpreted as a simple measure of relative economic performance.
“Scotland has historically had higher public spending per person than the UK average under the current fiscal arrangements, and GERS reflects both the revenues raised and the spending undertaken for Scotland. Understanding why the figures differ is therefore more informative than comparing the headline balances alone.”
The institute concluded: “The headline net fiscal balance will inevitably dominate the discussion, but it is only part of the story. Understanding why it has changed is just as important as the figure itself.”
