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  By Martin Kelly 
 
Labour MSPs at Holyrood have cheered and clapped claims by their leader Johann Lamont that the Scottish people rely on subsidies from Westminster and that Scots get "more money out of the United Kingdom than we put in it".
 
The Labour MSP made the claim during First Minister's Questions at Holyrood where she said that Scotland received £64.5bn from the UK Treasury but contributed only £56.9bn.

"There would be even less money to spend if Scotland votes to go independent." She said, to resounding cheers from her backbenchers who appeared to relish the 'subsidy junkie' theme of Ms Lamont's questioning.

However Ms Lamont's interpretation of the fiscal position of Scotland was challenged by the First Minister who pointed out that over the last four years, Scotland has been relatively better off to the tune of £12bn.

He said: "We have had a smaller deficit over the last four years than the UK, that is beyond doubt."

Mr Salmond added: "And for the people of Scotland, we would have been able to use Scotland's massive resources to benefit the people and the economy of this country."

The First Minister also revealed that the total amount borrowed by former Chancellor Alistair Darling and current Chancellor George Osborne was greater than all of the previous Chancellors put together.

The dispute over funding follows a blow for the anti-independence campaign earlier this week when the UK Treasury issued a shock announcement confirming that the rest of the UK would remain solely responsible for UK debt after independence.

The news was seen by many observers as strengthening the hand of the Scottish Government on the issue of a possible currency union between Edinburgh and London in the event of independence.

Ms Lamont's claim that Scotland contributed less than it got back from the UK was called into question when it emerged she had not factored UK borrowing into her figures.

Newsnet Scotland spoke to a specialist in economics who explained that the Scottish Labour leader appeared not to have understood the figures she quoted.

He said: "The £64.5bn figure quoted by Ms Lamont as representing the amount of funding Scotland receives from the UK Treasury, includes a proportion of borrowing by the Treasury to make up for the current UK deficit. 

"In order to determine which direction any relative subsidy is flowing, we must first strip away the amount made up through borrowing.  Stripping the UK borrowing away reveals that Scots contribute more per head into what's left than their UK counterparts.

"To put it simply, as things stand, if Scots pay in £9.90 then they get £9.30 back."

The borrowing powers of the Scottish Government are strictly limited by the Scotland Act 1998.  Any such borrowing aimed at increasing public spending must only be from the UK Government.  In effect, this means that the Scottish Government has no authority to raise extra resource by borrowing or sanctioning borrowing except for in exceptional circumstances.

The UK Government is able to borrow to fund public sector expenditure across the UK, including the Scottish Government block grant.

He added: "An independent Scotland would still have to borrow, as most countries do, in order to maintain public spending.  However, with a lower deficit, the amount needed to make up the difference would be less than at present.

"Johann Lamont's claim that a newly independent Scotland would have less money to spend than it does at present is an indication of how little she understands government finance and deeply worrying for someone who has ambitions to be First Minister"

Analysts have predicted that by 2016-17, borrowing will see UK debt grow to £1.6 trillion which will be over 100 per cent of its GDP.

Scotland's share of that debt would be around £130bn which will be between 75 and 80 per cent of Scotland's GDP.

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