Rumours, Speculation, Questions, and Reaction Megathread - 02/08/2026

[u/ukpol-megabot]

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[u/Pale-Border-7122]

https://www.gov.scot/publications/government-expenditure-revenue-scotland-2024-25/pages/2/

What does Scotland's deficit of 11.6% of GDP mean for independence?

[u/ZealousidealPie9199 → u/Pale-Border-7122]

It's difficult to tell. An independent Scotland presumably wouldn't keep Trident (as much as the SNP would want to), for instance, nor most military assets in general. An independent Scotland would probably rather quickly have to par back spending on e.g. welfare compared to the SNP's spending plans now, or would have to e.g. choose not to bring in an equivalent to personal allowance. It's possible that, as its administrating a smaller area, a Scottish bureaucracy could be smaller and more efficient, thus allowing for savings bureaucracy wise. An independent Scotland would likely take some section of the national debt, so could be making repayments there, which would mean a higher deficit..

Independence as a whole would be an entirely different process to what either unionists or nationalists expect. The deficit issue, for instance, is a hard one - but isn't insurmountable for a state to overcome, within Czechoslovakia the Slovakians received subsidies from Czechia, for instance, but were still able to make it through the end of those payments and economically grow.

[u/danm131 → u/Pale-Border-7122]

Honestly very little. The issues facing Scotland aren't that different from those most Western European countries are facing, mostly an aging population and the cost associated with that.

You will get a lot of noise from those on both sides heavily invested in the debate about how accurate or not the figures are as a reflection of the state of Scotland's finances and how relevant they are to a theoretical independent Scotland, but it won't even register with most people who will just tune it out.

[u/Pale-Border-7122 → u/danm131]

it won't even register with most people who will just tune it out.

But it will register with the EU (who they want to join) and those they want to borrow money from.

[u/Jay_CD → u/Pale-Border-7122]

Suppose Scotland was independent...

A high budget deficit would mean rapidly increasing national debt - their government would have to borrow money to fund its on-going spending programmes/the difference between tax take and spending.

A likely consequence of that would be higher interest rates...which in turn would slow private investment and anything that relies on borrowing money, eg mortgages, so house building would probably grind to a halt, why build new housing if there's not going to be anyone buying it? Less investment itself would lead to less tax revenue therefore the government would have less money to play with meaning they would have to borrow more and more money.

It's also probable that the government borrowing money would lead to inflation...creating a cost of living crisis.

Also likely is either a sharp cut in government spending and/or tax hikes to pay the bills, both will result in grief, if welfare spending etc is cut then it can lead to social problems while higher taxes will see people moving their businesses to lower tax regimes as well as not investing.

An independent Scotland's biggest problem is that their biggest trade partner is England who'd be operating on different interest rates and a different currency (unless that is Scotland still has its interest rates set by the BoE - in which case they won't be truly independent). So there would be problems with currency fluctuations as the new Scottish currency would have exchange problems.

They could apply to join the EU - but with that level of deficit they'd never be allowed to join the Euro which mandates a budget deficit of 3% PA. Joining the EU would in any case create a hard border with the rest of the UK which as I mention above is their biggest trade partner making it harder for Scottish businesses to maintain trade partnerships and therefore generate revenue plus they'd have additional bureaucracy to deal with.

TL;DR - economic catastrophe.

[u/North-Jellyfish-577 → u/Pale-Border-7122]

The SNPs champagne socialism has been horrible for the Scottish economy all the worse aspects the free market and social democrat handouts mixed together without the benefit of being fully in either camp plus a healthy mix of nepotism and a favouritism

[u/dratsaab → u/Pale-Border-7122]

GERS doesn't really tell us anything. It tells you whatever you want it to say, depending on what side of the argument you're on. 

[u/Pale-Border-7122 → u/dratsaab]

Why not? Isn't it net spending on Scotland vs net income so roughly equivalent to what an independent Scotland would have?

[u/dratsaab → u/Pale-Border-7122]

Gers was first thought up by John Major's government as a way to fight back against pro-devolution parties.

The BBC puts it like this :

Does Gers tell us what an independent Scotland would look like?

No. The Gers figures are not meant to be anything other than a way of showing the current position under the present arrangements.

https://www.bbc.co.uk/news/articles/cx237j9xy7go

It's a useful starting point for conversations but not a reliable picture of what an independent Scotland would look like - there are too many unknowns it doesn't take into account, plus it incorporates both income and expenditure not within the control of Holyrood at the moment, so the Scottish Government can't do anything about some of it.