The "Union Dividend" of £1941 per person [in 2019] only refers to the difference in current spending per head. It does not tell us what Scotland’s financial position would be after independence.
Expenditure generated in one area and spent in another is often described as a “fiscal transfer“, when more money than is raised in an area is spent there by the public sector as a whole. It means that revenue generated is not tied to the area it was created. In the UK, many areas have a net fiscal deficit.. Only London, the South East and East of England had a net fiscal surplus in 2019.
A number of reasons have been suggested for why Scotland’s spending per head is higher than the UK. These include the cost of providing public services to remote areas with lower population density, and historical issues with poverty and health leave Scotland in greater need.
The Scottish Government has also cited costs for services which are provided by the public sector in Scotland, but not in England, such as household water and sewerage services.
Some of the spending referred to in GERS is ‘non-identifiable’, which means it is spent by the UK as whole and not necessarily in Scotland. This includes a proportion of defence spending and debt interest payments.
Any figure for the fiscal transfer between the UK and Scotland is unofficial, and civil servants have warned that this is because it is impossible to provide one without making assumptions about the purpose of borrowing and spending undertaken by the UK Government as a whole.
Jamie Greene’s claim that this figure equates to an amount people would be worse off if Scotland became independent is misleading.
£1941 per person only refers to the difference in current spending per head. It does not tell us what Scotland’s financial position would be after independence. GERS is a snapshot of the current position within the existing constitutional arrangements.
It’s not possible to predict how much money a notionally independent Scotland might be able to spend in the future, and how this might compare with the amount spent per person in the rest of the UK at that time.
The GERS figures do not show that if Scotland were to become independent, each person in Scotland would become £2,000 worse off. The figure only refers to the current difference between revenue and spending in Scotland compared to the UK.