Rise in North Sea oil and gas revenues sees Scottish deficit fall
Scotland’s deficit fell to £13.3 billion for 2016–17 amid an increase in oil and gas revenues, according to new figures.
The Government Expenditure and Revenue Scotland (GERS) statistics show a deficit of £13.3 billion when a geographic share of North Sea revenues is allocated to Scotland. The figure amounts to 8.3 per cent of Scottish GDP, compared with the overall UK deficit of £46.2 billion, some 2.4 per cent of UK GDP.
North Sea revenue rose from £56 million in 2015/16 to £208 million, reflecting an increase in total UK oil and gas revenues. The figures also show Scotland’s onshore revenues increased by £3.3 billion.
“Scotland’s economy remains strong,” says Scotland’s First Minister, Nicola Sturgeon. “In the last quarter, our economy grew nearly four times faster than the UK and the number of people in employment is at a record high.”
“These figures reflect Scotland’s finances under current constitutional arrangements. However, they show that our investment in key industries, such as the life-science sector, is providing a real boost to our onshore economy. By continuing to invest in key sectors, we will ensure Scotland remains a productive and competitive country.
“The lower oil price had an impact on North Sea revenues and the wider economy last year. However, it is encouraging to see an improvement in the overall fiscal balance and that onshore revenues grew at their fastest rate in nearly twenty years.
“However, our long-term economic success is now threatened by Brexit, which risks reducing household incomes, employment and funding for public services. That is why we continue to press for the Scottish Government to have a direct role in Brexit negotiations.”
The figures also show that Scottish public sector revenue, including a geographic share of North Sea revenues, was estimated as £58 billion – the equivalent of £10,722 per person and about £312 per person lower than the UK average.
“It is encouraging that our fiscal balance improved by nearly 10 per cent last year,” says Scottland’s Finance Secretary, Derek Mackay. “It is important to also recognise that Office for National Statistics analysis shows that Scotland performs ahead of Wales, Northern Ireland and several English regions, and in line with the UK average outside of London and the South East.
“Meanwhile, evidence also points to signs that confidence is increasing among North Sea operators, with the sector set to remain an important part of Scotland’s economy for years to come.”