Scotland showing £1.3bn surplus say Holyrood ministers

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Scotland generated more cash than it spent, even during the recession, the Scottish government has said.

From Democracy Live: Finance Secretary John Swinney tells MSPs of budget surplus

Ministers said official figures for 2008-09 showed a £1.3bn budget surplus in Scotland, while there was a UK-wide deficit of £48.9bn.

But Labour said Scotland was actually showing a net fiscal deficit of £3bn.

The figures, including a geographical share of North Sea revenue, were released in the Government Expenditure and Revenue Scotland (Gers) report.

They also included a share of the UK government's banking bailout funding.

Mr Swinney said: "This is the fourth year in a row to record a Scottish current budget surplus even as the UK moved into recession and the cumulative value of Scotland's surplus since 2005-06 now stands at some £3.5bn, compared to a UK deficit over the same period of £72.3bn.

In Tory days, the aim of ministers was to demonstrate that self-government would be a fundamental mistake.

Now the ministers in St Andrew's House are Nationalist and their aim is to show that Scotland could run her own economy, including full control of tax and spending.

Finance Secretary John Swinney believes today's official report, which covers 2008-09, proves just that.

You will, I feel sure, be astonished to learn that Labour's Andy Kerr places exactly the opposite interpretation upon the selfsame figures.

"These figures reinforce the case for Scotland determining its own tax and spending decisions, and managing other key economic levers, with the powers of financial responsibility and independence.

"That will enable us to take the decisions in Scotland needed to grow the economy, because growth is the key to moving out of the financial difficulties we face."

However, the Gers report also said Scotland's net fiscal balance, which takes in capital and infrastructure spending, showed a £3.8bn deficit, compared to a £96.1bn for the UK.

Labour finance spokesman Andy Kerr accused ministers of skewing the figures and said it was "wrong to mortgage Scotland's future on the price of oil".

He said: "These figures show that a separate Scotland would be dangerously dependent on volatile oil prices.

"Even on the most generous assessment, there have only been 10 years in the last 28 when Scotland's finances were in surplus - and none since 1988."

Mr Kerr added: "It is also clear from these figures that there is only a surplus if you don't include spending on schools, hospitals and roads."

The figures were published a day after Mr Swinney said the UK Budget would jeopardise Scotland's economic recovery by going "too far, too fast".

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