The NDRI pool…

As the Scottish Budget for 2017/18 has passed through Parliament, the operation of the Non-Domestic Rates pool has risen to prominence. It has provided the Cabinet Secretary for Finance with flexibility to support local government spending and ease the burden of the revaluation to business rates.

So how does the NDRI pool work and what could be the implications over the medium term in the light of the additional cash taken from it to get the budget passed this year?Continue reading

March 30, 2017

Budget 2017: a boring budget?

What a difference a year makes.

Delivering his Budget in March 2016, then Chancellor George Osborne set out plans to deliver a fiscal surplus – revenues higher than spending – by 2019/20. Growth was forecast to be 2.2% in 2017.

By the time of the Autumn Statement in November, the forecast for growth in 2017 had been cut to 1.4%. The forecast for public sector net borrowing over the course of this parliament had been revised up by £100bn, largely (but not entirely) due to the anticipated impacts of Brexit on the economy and public finances. Any hope of a budget surplus had long been extinguished.

Was today’s Budget able to offer good news? And what are the implications for the Scottish Government’s Budget?Continue reading

March 8, 2017

March Nowcasts of the Scottish Economy

Grant Allan & Stuart McIntyre
Fraser of Allander Institute, University of Strathclyde

The performance of the Scottish economy has been relatively fragile for some time now; growth has slowed since early 2015 and shows little sign of picking up. In this blog we provide the latest update from our nowcasting model for Scotland. Further details on our approach and model are available here.

This month our estimates of growth in the Scottish economy put current growth (Q1 2017) at a modest 0.38%. This remains relatively low by historical standards, although better than some recent quarters.

Our most recent nowcast for 2016 Q4, for which official estimates are released by the Scottish Government next month, put growth at 0.42%. This is very marginally better than our current estimate for 2017 Q1.

Continue reading

March 6, 2017