HC Deb 25 November 1996 vol 286 cc46-8W
Mr. Salmond

To ask the Secretary of State for Scotland if he will estimate at 1996–97 prices the public sector balance between revenue and expenditure for Scotland for each year from 1979–80 to 1994–95 after deducting a gross domestic product share of the United Kingdom general government borrowing requirement, a gross domestic product share of privatisation proceeds and allocating 90 per cent. of oil revenues to Scotland's revenue. [1366]

Mr. Waldegrave

[holding answer 31 October 1996]I have been asked to reply. The table shows the calculations requested. The method proposed for calculating Scotland's budget balance, by simply assuming that the shares of Scotland in total expenditures and revenues are in proportion to Scotland's share of GDP, is misconceived, since it takes no account of available information of government expenditure and revenue in Scotland. Approximate estimates of these are published in the "Government Expenditure and Revenue in Scotland" annual report. These show much higher borrowing figures for Scotland in recent years than given by the requested calculations.

Estimates of Scotland's share of the UK General Government Borrowing Requirement (GGBR)
£ billion
UK GGBR excluding privatization proceeds (pps) and north sea oil revenues, at current prices Scoltland's share of UK GDP1 (per cent.) Scotland's implied share of UK GGBR, at current prices 90 per cent. Of oil revenues, and GDP share of UK pps, at current prices2 Scotland's implied GGBR at current prices Scotland's implied GGBR at 1996–97 prices3
1984–85 23.3 8.7 2.0 11.0 -9.0 -15.1
1985–86 20.9 8.7 1.8 10.4 -8.6 -13.8
1986–87 14.1 8.5 1.2 4.7 -3.5 -5.4
1987–88 7.8 8.5 0.7 4.6 -3.9 -5.8
1988–89 -1.5 8.4 -0.1 3.4 -3.6 -4.9
1989–90 0.0 8.3 0.0 2.5 -2.5 -3.2
1990–91 7.1 8.5 0.6 2.5 -1.9 -2.4
1991–92 22.8 8.6 2.0 1.6 0.4 0.5
1992–93 47.3 8.7 4.1 1.9 2.2 2.4
1993–94 53.5 8.7 4.7 1.6 3.1 3.3
1994–95 45.8 8.8 4.0 2.0 2.0 2.1
Total -72.2
UK GGBR
Source:
Public Finance Trends, 1996. A negative figure indicates a budget surplus.
1 Scotland's GDP at factor cost (current prices) as a percentage of GDP in the UK less continental shelf, calendar years.—Source: Regional Trends, 1996.
2 Assumes 90 per cent. of north sea oil revenues and Scotland's GDP share of privatisation proceeds.
3 Based on the summer economic forecast of the GDP deflator in 1996–97. Figures may not add up to totals due to rounding.

Mr. Salmond

To ask the Secretary of State for Scotland if he will estimate the cumulative gross domestic product share for Scotland of the United Kingdom's general government borrowing requirement from 1979–80 to 1994–95 expressed in 1996–97 prices. [1364]

Mr. Waldergrave

[holding answer 31 October 1996]I have been asked to reply.

The table shows the calculations requested. The method proposed for calculating Scotland's budget balance, by simply assuming that the shares of Scotland in total expenditures and revenues are in proportion to Scotland's share of GDP, is misconceived, since it takes no account of available information of government expenditure and revenue in Scotland. Approximate estimates of these are published in the "Government Expenditure and Revenue in Scotland" annual report. These show much higher borrowing figures for Scotland in recent years than given by the requested calculations.

Estimates of Scotland's share of the UK general Government borrowing requirement (GGBR)
£billion
UK GGBR UK GGBR (1996–97 prices1 Scotland's share of UK GDP2 (per cent) Scotland's implied GGBR (1996–97 prices) Scotland's cumulative GGBR (1996–97 prices)
1979–80 10.4 26.8 8.8 2.4 2.4
1980–81 13.6 29.5 8.7 2.6 4.9
1981–82 8.6 17.0 8.9 1.5 6.4
1982–83 10.0 18.6 8.9 1.7 8.1
1983–84 9.9 17.5 8.9 1.6 9.6
1984–85 9.3 15.6 8.7 1.4 11.0
1985–86 6.9 11.0 8.7 1.0 12.0
1986–87 4.9 7.5 8.5 0.6 12.6
1987–88 -2.0 -2.9 8.5 -0.2 12.4
1988–89 -11.7 -16.2 8.4 -1.4 11.0
1989–90 -6.6 -8.6 8.3 -0.7 10.3
1990–91 -0.6 -0.7 8.5 -0.1 10.2
Estimates of Scotland's share of the UK general Government borrowing requirement (GGBR)
£billion
UK GGBR UK GGBR (1996–97 prices1 Scotland's share of UK GDP2 (per cent) Scotland's implied GGBR (1996–97 prices) Scotland's cumulative GGBR (1996–97 prices)
1991–92 13.9 15.9 8.6 1.4 11.6
1992–93 37.9 41.5 8.7 3.6 15.2
1993–94 46.8 49.9 8.7 4.3 19.5
1994–95 37.8 39.6 8.8 3.5 23.0
Total 262.0 23.0
Notes:
UK GGBR. Source: Public Finance Trends, 1996. A negative figure indicates a budget surplus.
1 Based on the HMT Summer Economic Forecast of the GDP deflator in 1996–97
2 Scotland's GDP at factor cost (current prices) as a percentage of GDP in the UK less Continental Shelf.

Source:

Regional Trends.

Figures may not add up to totals due to rounding.