Chief Economist Directorate
Office of the Chief Economic Adviser (OCEA) Division
E: xxxxxxxx.xxxxxxxxxx@xxx.xxxx
Edward Witney
Via email
___
Your ref:
Our ref: FOI/18/03746
9 January 2019
REQUEST UNDER THE FREEDOM OF INFORMATION (SCOTLAND) ACT 2002 (FOISA)
Dear Edward Witney,
Thank you for your request dated 14 December 2018 under the Freedom of Information
(Scotland) Act 2002 (FOISA).
Your request
You asked for:
All data and analysis that the Scottish Government has done on the fiscal transfers to
Scotland from the UK and rUK.
That is, specifically, the amounts of fiscal transfer that we received in 2017/18 from
the UK and rUK?
In separate correspondence you have also asked:
Scotland ran a deficit of £13.4bn last year. That money had to come from somewhere
and as far as I’m aware most of that money came in the form of a fiscal transfer …
Are these numbers correct or incorrect?
And:
The ONS also release regional data on deficits and surpluses. Can you please tell me
whether these numbers are correct or not and if not correct what the fiscal transfer
numbers were for last year?
The response below addresses all these queries.
Response to your request
The majority of taxes in the UK are set and collected by the UK Government and are used to
fund public services throughout the UK, irrespective of which part of the country in which the
revenue was raised.
St Andrew’s House, Regent Road, Edinburgh EH1 3DG
www.gov.scot
The Scottish Government receives a block grant from the UK Government to help fund
devolved services in Scotland. This is set out in Table 1.02 of the Scottish Government Draft
Budget 2017-18. In 2017-18 the total budget limit from HM Treasury was £31.6 billion. In
contrast, approximately £60.0 billion in tax revenue is estimated to have been raised in
Scotland from a combination of reserved and devolved taxes.
The £13.4 billion figure you refer to is published in Government Expenditure & Revenue
Scotland (GERS). It is the estimated difference between total public sector revenue raised in
Scotland and expenditure for Scotland in 2017-18. It includes all public sector expenditure
for Scotland, some of which is not spent by the Scottish Government. For example, the state
pension, child tax credits, and defence expenditure are not paid out of Scottish Government
budgets.
However, it is important to note that this figure does not represent a fiscal transfer from the
rest of the UK to Scotland. Official figures for any fiscal transfer are not available.
The reason this information is not available is that such a figure requires a number of
assumptions to be made. For example, as the UK as a whole spends more than is raised in
revenue, an assumption would need to be made about which parts of the UK borrowing is
undertaken for, or which types of public spending are financed by borrowing as opposed to
taxation. This information is not available as, for example, some taxes are ringfenced to fund
particular services; for example, some national insurance contributions are ring-fenced to
fund the NHS. As such, any figure for a fiscal transfer from the rest of the UK to Scotland
would rely on a number of assumptions. Similarly, note that the ONS publication on regional
public sector finances you refer to does not include numbers for fiscal transfers.
Your right to request a review
If you are unhappy with this response to your FOI request, you may ask us to carry out an
internal review of the response, by writing to the Chief Economist, St Andrews House,
Regent Road, Edinburgh, EH1 3DG, or emailing
xxxx.xxxxxxxxx@xxx.xxxx. Your review
request should explain why you are dissatisfied with this response, and should be made
within 40 working days from the date when you received this letter. We will complete the
review and tell you the result, within 20 working days from the date when we receive your
review request.
If you are not satisfied with the result of the review, you then have the right to appeal to the
Scottish Information Commissioner. More detailed information on your appeal rights is
available on the Commissioner’s website at:
http://www.itspublicknowledge.info/YourRights/Unhappywiththeresponse/AppealingtoCommi
ssioner.aspx. Yours sincerely,
Iain Pearce
Office of the Chief Economic Adviser
St Andrews House
St Andrew’s House, Regent Road, Edinburgh EH1 3DG
www.gov.scot