KATE Forbes has claimed an independent Scotland could rely on economic growth to avoid austerity and reduce its deficit despite the unprecedented global recession.

The Finance Secretary said Scotland would use a series of fiscal "levers” like any other country if it left the Union.

However pressed on what levers besides growth she had in mind, she failed to identify any except no longer paying for a share of the Trident nuclear deterrent.

Speaking after the annual GERS figures showed Scotland had a notional deficit of £15.1bn or 8.6 per cent of GDP in 2019/20, Ms Forbes said it was Ms Forbes said it was "incredibly frustrating" that Scotland could not borrow to invest in the recovery from Covid.

She said: "Gers reflects the current constitutional position, there are perfectly legitimate questions to ask about these figures, but based on these figures nobody can or should defend the status quo of the current constitutional arrangements.

"Instead, this publication once again strengthens calls for additional fiscal and economic powers to manage our public finances in a sustainable way and invest in recovery.

"Scotland simply cannot afford not to have the powers of a normal independent country."

The SNP Growth Commission blueprint for independence said Scotland would need to keep a tight rein on public spending to halve its deficit in 10 years after a Yes vote.

Unionist critics argue that effectively means continued austerity, tax rises or spending cuts.

Asked what levers she would use other than economic growth to cut the deficit, Ms Forbes said: “Well your primary means in economic growth.” 

Pressed what else she had in mind, she called for more borrowing powers, despite this added to a deficit, not cutting it. 

She said: “The primary lever that asking for right now is the lever that every country around the world is using to respond to the pandemic. That is borrowing powers.”

“Countries are borrowing not just at lowe interest rates, they’re borrowing at negative interest rates, in other words investors have such confidence right in countries’ ability to repay both small and large, in some cases they are paying to lend.

“The point here is that if we want to respond with all the levers that could be at our disposal, borrowing powers and the powers to grow our economy, then we would be able to put ourselves on a sustainable footing which these GERS figures suggest that the current constitutional arrangements are not.”

The Growth Commission suggested the 40% of Scottish public spending that lies in reserved areas, such as defence, pensions and welfare, could be reset to find efficiencies.

Asked again what levers she would use, Ms Forbes said: “The primary means by which you close deficits is economic growth.

“If you look at what the Growth Commission set out, at for example the 40% of reserved expenditure and concluded that we could probably do things a lot better.”

The Finance Secretary was asked about the Fraser of Allander Institute think-tank's initial response to GERS, which said Scotland's deficit could grow to around 21% and 22% next year, and if this would be sustainable for an independent Scotland.

She said countries around the world had built up "unprecedented deficits" to deal with the pandemic which would be reduced over time.

GERS also showed that as a result of cross-border transfers, public spending per head in Scotland was £14,829 or £1,633 higher than the UK average last year.

In addition, tax revenues per head in Scotland were £308 less than in the UK as whole, meaning the combined “fiscal gap” was £1941 per person to Scotland's advantage.

Asked about the higher per capita public spending in Scotland, Ms Forbes said: "I look at those figures and see the current constitutional arrangements as being unsustainable."

In 2012, Nicola Sturgeon said a notional Scottish surplus in GERS was a reason to vote Yes.

Ms Forbes today said a notional deficit was also a reason to vote Yes.

She said: "It’s a good reason to vote Yes because the decisions taken by the people living in the country are usually the best decisions for the people of that country.

“As we look ahead over the comings months, and indeed the coming years, the potential for Scotland to have full discal control and make the decisions that are right for Scotland, right for our economic recovery, right for the challenges that we face, the point is that during these unprecedented times we need the full levers to respond.

“These are not levers that we have had during the crisis, and I think that we have seen, quite demonstrably, the way that other small countries have responded, the way that they have been able to find their interventions and that’s precisely what we could do as well.” 

Asked if the economic numbers didn’t matter and the Government’s answer would always be to vote Yes, Ms Forbes said: “If you look at GERS, GERs are a series of figures. They’re helpful for informing the wider debate, they’re not the Scottish Government’s budget, which has to balance every year, and bear in mind that 40% of the expenditure is reserved, ie reflecting another government’s policy choices, not the policy choices an independent Scotland might make.”