A LEADING economist has called on the Scottish Government to stop publishing the Government Expenditure and Revenue Scotland (GERS) figures, insisting they do not reflect the country’s financial position.

Retired Professor David Simpson, founding director of the Fraser of Allander Institute at Strathclyde University, made the call in an article he has written for The Sunday National.

He argues the GERS figures do not present Scotland’s real financial situation as some UK spending in reserved areas such as defence and foreign affairs is apportioned to the Scottish Government “as if” they spend it when they do not.

He argues that the annual statistics are misinterpreted every year by opponents of independence who use them as a justification for remaining in the UK.

Last year, “the notional deficit” or gap between money spent on public services and income raised from taxes in Scotland was £36.3 billion or 22%, up from £15.1bn (8.6% cent of GDP) in 2019-20 as public spending rose significantly during the ongoing Covid pandemic.

READ MORE: What is GERS and why is everyone talking about it?

However, Simpson argues that the actual deficit between revenue raised and expenditure is zero as under the terms of the devolution settlement the Scottish Government is obliged to balance its budget every year.

Every year the Scottish Government publishes in GERS an estimate of what it calls Scotland’s “net fiscal balance”.

Since the balance has been negative since the oil era, it has become commonly known as “the fiscal deficit”. That measure does not correspond to the measure of a fiscal deficit used by other countries.

“It is widely misinterpreted and provides political ammunition to Unionists,” he writes. “Everywhere else in the world, including the UK, the term ‘fiscal deficit’ means a shortfall in the revenue of a Government compared to its expenditure.

“If Scotland’s fiscal balance was compiled according to recognised standards of national accounting, then the expenditure side of the balance would show expenditure by the Scottish Government.

“Since the Scottish Government is obliged by the devolution settlement always to balance is budget, Scotland’s fiscal deficit in the proper sense of that term is zero every year.”

He adds: “In Scotland’s case, the ‘benefits’ include items like an apportionment of MoD spending in support of the Trident submarine base on the Clyde, as well as Saudi Arabia’s activities in the Yemen. Other examples of unwanted expenditure by Whitehall Departments include payments of benefits for unemployment created by UK Government policies, and expenditure incurred in pursuit of external trade treaties that disadvantage Scottish economic interests.”

Simpson argues another misinterpretation is the “deficit” is a reflection of poor management of the Scottish economy by the Scottish Government which he argues appears to be accepted by ministers. “Responsibility for the behaviour of the Scottish economy is a function reserved to the Westminster Government, and it is they who should be held accountable,” he adds.

Simpson argues the need for greater public spending in health and education in Scotland are as a result of a damaging effect of the Union. He concludes: “It makes no sense for the Scottish Government to assist our Unionist opponents by continuing to confer political legitimacy upon a scientifically illegitimate statistic. It should cease its publication.”

The Scottish Government said: “The GERS figures reflect Scotland’s position within the UK – not independence – under which 40% of spending and 70% of revenue income is reserved to the UK Government.

“The pandemic has clearly demonstrated the need for increased financial powers for Scotland, including the full borrowing powers that other countries have been able to use to support their economies during the coronavirus (Covid-19) crisis.”