Public Finance

Scotland’s Finances – The Truth

Author / Creator: Business for Scotland

Media type: Blog

Date published: 2022

There is no set of accounts that tells us how an independent Scotland’s economy would fare, nor what its finances would look like. Not yet anyway.


Hiding the Truth

Author / Creator: John Jappy

Media type: Video

Date published: 2014

The videos of John Jappy and they should be compulsory viewing for every Scot


The Man Who Knew Too Much

Author / Creator: John Jappy

Media type: Blog

Date published: 2014

Jappy was among the first to scotch the myth that Scotland was subsidised by London. In truth it was, and is the reverse, Scotland pays more to England’s coffers than it receives in annual allowance.


The self-financing state: An institutional analysis

Author / Creator: Josh Ryan-Collins

Media type: Working Paper

Date published: 2022

"The UK Government creates new money and purchasing power when it undertakes expenditure, rather than spending being financed by taxation from, or debt issuance to, the private sector."


What Scotland can learn from Irish independence: it won’t control interest rates and inequality will widen

Author / Creator: Eoin McLaughlin

Media type: Article

Date published: 2022

Managing the transition [to independence] won’t be straightforward. Ireland’s experience shows that the need for fiscal discipline may be politically costly and adjustment may not be shared equally.


Essential pre-budget reading – the 7 key messages from our budget report

Author / Creator: David Eiser

Media type: report

Date published:

The Scottish government will publish its budget for 2022/23. It will be the first budget of this session of parliament. Kate Forbes’ third budget in charge of the Scottish Government’s finances will arguably the most difficult she has faced. The Scottish government will have more resources at its disposal than in 2019/20. But the challenges facing public services and the wider economy are far more acute now than they were then.


Kate’s budget blues

Author / Creator: David Eiser

Media type: Article

Date published:

“A core resource block grant in 2022/23 that is 8% higher than pre-pandemic might sound generous. But to deal with the pandemic’s legacy and underlying public services pressures it is anything but. Kate Forbes’ third budget may well be her most challenging.”


The Politics of Scotland’s Public Finances

Author / Creator: David Heald

Date published: 2020

The Barnett formula is a political convention reducing overt political conflict with the UK while maintaining fiscal autonomy.


Scotland the Brief

Author / Creator: Gordon MacIntyre-Kemp

Media type: book

Date published: 2020

All you need to know about Scotland's economy, its finances, independence and Brexit.


Nationalism and the politics of austerity: comparing Catalonia, Scotland, and Québec

Author / Creator: Daniel Beland

Media type: Academic Paper

Date published:

This analysis of the impact of austerity on nationalism stresses the role of blame as it interacts with political institutions and fiscal pressures.


Minimizing the Cost of Union: Fiscal Autonomy and the Case of Scotland

Author / Creator: Paul Hallwood

Media type: Academic Paper

Date published: 2020

Argues for federalism in public funding where taxation is devolved.  This would improve the link between public finance and democracy.


Ambiguous no more: Time to de-mystify the Barnett Formula

Author / Creator: J. R. Cuthbert

Media type: Academic Paper

Date published: 2020

The overall effect of the new Barnett funding system is to place Scotland in a vulnerable position, where it is at much greater risk of falling into a cycle of economic decline relative to the rest of the UK.


The Barnett Formula

Author / Creator: Matthew Keep

Media type: Briefing paper

Date published:

The Barnett formula calculates the annual change in the block grant. The formula doesn’t determine the total size of the block grant just the yearly change. For devolved services, the Barnett formula aims to give each country the same pounds-per-person change in funding.


Barnett formula

Author / Creator: Wikipedia

Media type: Wikipedia

Date published: 2021

The Barnett formula is a mechanism used by the Treasury in the UK to automatically adjust the amounts of public expenditure allocated to Northern IrelandScotland and Wales to reflect changes in spending levels allocated to public services in England. The formula applies to a large proportion, but not the


Parting Ways How Scotland and the remaining UK could negotiate the separation of debts and assets

Author / Creator: Craig Dalzell

Media type: Policy Paper

Date published: 2020

Upon declaring independence, the public assets must be divided by sensitive negotiations.


Scotland spends 20% more per head on public services than England

Author / Creator: Claire Milne

Media type: Fact check

Date published:

It’s correct that spending on public services in Scotland is 20% higher per head than in England. But this money comes from the block grant from the UK Treasury, rather than from England specifically.  Also the only areas of England that are not in deficit according to this are London and the South east of England.


Would an independent Scotland have to keep the pound and cut public spending?

Author / Creator: Joël Reland

Media type: Fact check

Date published:

Public spending in an independent Scotland could continue to grow. This does depend on sufficient growth in the economy after independence.


HS2 will not cost Scotland £17 billion

Author / Creator: Full Fact

Media type: Fact check

Date published:

There is no evidence for the claim that HS2 will cost Scotland. In effect, all money spent by Scotland on HS2 is returned through the Barnett formula.


What are the implications of independence for public revenues and spending?

Author / Creator: Graeme Roy

Media type: Assessment report

Date published: 2021

There is no question that an independent Scotland could run a sustainable budget. But like the UK, an independent Scotland would face major fiscal challenges both in the short and long run. Based upon the latest data, an independent Scotland is likely to face greater challenges than the UK as a whole (at least in the short-term).