Written by Steve Asaneilean in answer to a post at Wee Ginger Dug, and reproduced here with his permission.
In case anyone is in any doubt about the Barnett formula, the stated aim of Westminster is to reduce public spending so even if Barnett is retained its value to Scotland must fall if Westminster achieves its stated aims on public spending.
But, despite noises from BT?NT to the contrary, as you point out Nancy there is real doubt that Barnett will survive and its replacement will certainly not be more favourable to Scotland than Barnett. And there are plenty indications out there that all the Westminster parties want to see Barnett chopped as these quotes posted on Wings Over Scotland in February clearly demonstrate (the “best” one being from Joel Barnett himself after whom the formula is named):
David Cameron, Prime Minister – “[The Barnett formula] cannot last forever, the time is approaching”
Alistair Carmichael (Liberal Democrat) – “We do want to see Barnett scrapped. We want to see that replaced by what we call a needs based formula.”
Margaret Curran (Labour) – “I do believe that we should allocate public funding on the basis of need and it should not be around just a regional or a national demarcation around that.”
The House of Commons Justice Select Committee – “The Barnett Formula is overdue for reform and lacks any basis in equity or logic. It creates controversy in all of the constituent parts of the UK. There is controversy in England that the Barnett Formula allows for higher levels of public spending in Scotland from the UK Exchequer and does not deal with different needs in different parts of England. We urge the Government to publish its position as a matter of some urgency and to proceed to devise a new formula which is needs based, takes into account regional disparities in England as well as in Scotland and Wales, is transparent and is sufficiently robust to enable long-term planning.”
Local Government Association, England – “Council leaders in England are to campaign for Scotland’s block grant to be cut. Local government chiefs south of the Border say they are envious of the powers and funding given to a devolved Scotland and have revealed they will push for the UK Treasury to scrap the Barnett formula, the system that gives Scotland more per head of UK funds than it does to England and Wales.
The All Party Parliamentary Taxation Group – “The APPTG echoes the findings of the House of Lords Committee on the Barnett Formula in recommending that a shift is required towards a ‘needs-based’ formula, whereby a ‘dynamic’ and ‘simple, clear, and comprehensible’ system is used to allocate resources to the devolved regions ‘based on an explicit assessment of their relative needs’, calculated ‘per head of population’.”
Ruth Davidson, Leader of the Scottish Conservative and Unionist Party – “Barnett was only supposed to be temporary… I do think that there will be a review of Barnett after 2014. The ground has shifted since devolution.”
Lord Lang of Monkton – “On the Barnett surplus, everyone knows that the basis of the present distribution of funds is out of date. We know that that, too, created an imbalance that can be put right. A fair-minded Scotland would agree. We need an up-to-date measurement of relative need in Scotland and elsewhere in the United Kingdom.”
The Calman Commission – “The commission has decided major changes need to be made. Significantly, however, experts believe the change will result in a drop in Scotland’s budget – which could lead to cuts in service”.
Lord Joel Barnett, who devised the formula – “It’s quite wrong. It clearly should not be based on per head expenditure but should be based on needs in particular areas. The amount of money going to Scotland on a needs basis by comparison, say with my own North West or the North East, is far higher than it should be, so it should be changed. They'd lose quite a bit in my guess, done on a proper needs basis”.
So what do you think that means for you if we are in the UK?