FORMULA UNFAIRNESS

23 October 2007

People in Scotland are getting for free a range of public services that people in England are charged for. In England prescription charges are presently £6.85 an item and only off-peak buses are free for people over sixty. In Scotland there are free eye check ups, free dental check ups, and the arrangements for free bus travel for the elderly are more generous. Tuition fees are paid by students at university in England but Scottish students at university in Scotland do not pay them (though there is in Scotland a one-off flatrate graduate fee of about £2300 payable on graduation). In Scotland there are generally shorter NHS waiting list times and smaller school classes; some drugs are available on the NHS that are not available in England; the arrangements for personal and nursing care are more generous.

The Scottish government has just started a six month pilot of free school meals in some areas for pupils aged five to eight and hopes to extend it all over Scotland. It has also announced that prescription charges will be abolished for everyone within the lifetime of the present Scottish parliament and aims to abolish the university graduate fee.

I don’t live in Scotland and it is up to people there and their government to decide what happens in Scotland.

However, these improvements are possible because the Barnett formula gives a much higher percapita amount of UK identifiable government spending on public services in Scotland than in England. The formula, leading to the higher spending in Scotland and the free or more generous services, is increasingly seen as unfair to England. For 2005/06 the percapita public spending in England (including Cornwall) was £6762 and in Scotland £8265 (and in Northern Ireland £9088, and Wales £7666). This formula is unfair and untenable. It should be scrapped and a new arrangement made for spending UK taxes in the four constituent countries.

For Labour, with a majority of the Scotland seats in the UK parliament and dependent on Scotland for its UK majority, this is an issue they will not tackle; nor will they tackle the related issue of MPs for Scotland constituencies voting for England-only issues in the House of Commons. The Conservatives sometimes rumble about Barnett unfairness but seem undecided whether to commit to tackle it. It is noticeable that the Liberal Democrat MPs for Cornwall complain about what they see as unfair public spending in Cornwall, point to the UK government, but do not mention the Barnett formula.

Slowly people in England are realising the unfairness of the present formula and the present House of Commons voting arrangements and eventually parties will not be able to ignore them.

The Times on 11 October 2007 quoted figures from the Centre for Economic Business Research that showed state spending by the constituent UK countries as a proportion of economic activity was lowest in England and significantly higher in the other three countries.

An earlier post on the Barnett formula is here.

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