1. Setting the Scene for Change
Richard Murray
Office of the Chief Economic Adviser

2. Synchronised Global Downturn

3. Scale of the Recession in Scotland

4. Fiscal Impact of Recession
Government borrowing
Expenditure
Revenue

5. Sharp Rise in UK Borrowing

6. Type of Borrowing

7. UK Government’s Fiscal Mandate

8. Total Scottish Government Budget
Approximately half the cuts to occur next year

9. Long-Term Budgetary Impact
Scottish Government DEL Expenditure ( prices)
16 years
£39 billion

10. Stage of the Recovery

11. Unemployment Remains High

12. Gradual Recovery in Scottish GDP

13. Significant Risks Remain
Impact of the fiscal consolidation
Rising inflationary pressures
Sovereign debt concerns in Euro Area

14. Concluding Thoughts Scottish economy in early stages of recovery
Effects of the recession still being felt
Significant uncertainty remains over strength of the recovery
Impact on the public finances over the medium to long term