11 January 2012

Cornish political nationalists want an autonomous Cornwall separate from England and with its own assembly or parliament. The wording varies and I use autonomy as a catch-all. Ten years after a Mebyon Kernow petition for a Cornish Assembly the party is trying to cry it up. I shall look at the assembly and petition in a later post but perhaps I can focus now on a difficulty that I see in the nationalist argument. I can put it in the form of a simple question: Who gets to pay for this separate Cornwall?

That question is in danger of being lost in the Rub’ al Khali, the empty quarter of nationalism.

The funding question is linked to the form of autonomy and nationalism appears to be divided on that though most seem to look for arrangements short of independence outside the United Kingdom. What happens in Scotland’s eventual vote on secession and independence may well influence how Cornish political nationalists see Cornwall’s future constitutional status.

Present funding arrangements for Cornwall
At present public services in Cornwall, stuff like old age pensions, the NHS, schools, benefits, and much affordable housing are funded directly or ultimately by the UK government from pooled national taxes paid by individuals and companies across Britain, including Cornwall. Industrial and commercial grants are also funded by the UK government from pooled national taxes. The EU returns some of the net funds the UK gives it to projects across the UK including Cornwall; these might reasonably be seen as recycled UK taxes. Local levies such as council tax and car parking charges fund only a small proportion of public spending here – as in any county. The amounts made available from the national pool to Cornwall and other local authorities are at bottom decided by the UK central government and indeed many decisions on local spending are in effect made by the central UK government.

Future funding arrangements
There are two possible ways that an autonomous Cornwall could be funded: from funds generated wholly within Cornwall or from pooled UK funds with some local levies.

Cornwall pays for itself
Is the nationalist intention that an autonomous Cornwall would wholly pay its own way (apart from externals like defence perhaps)? This means that whatever we need inside Cornwall would be paid for by taxes raised only in Cornwall and not elsewhere; and a nationalist Cornwall would take its own decisions using only its own locally-raised money. It would set and collect its own income and corporate tax rates, for example.

Such a self-financing Cornwall would effectively be independent.

However, I doubt that this self-financing is feasible. I do not believe enough money could be generated from within Cornwall to pay for a twenty-first-century state.

Barnett dependency
More likely is the funding of Cornwall based on the Barnett scheme or some such. The expectation would be that taxpayers outside Cornwall would subsidise our devolutionary fling; that is, taxpayers in the UK, largely England and largely London and along with the EU, pay us more from the common pool than we put in. Suppliant devolution, eh; you pay, we spend autonomy. Some destiny that, and vastly unattractive and unpersuasive.

The 2001 petition did not detail funding and the 2009 parliamentary bill for an assembly seemed to envisage Cornwall largely funded by a redistributed pool arrangement. However, the Barnett scheme is increasingly contentious because the three devolved areas of the United Kingdom are seen by many to get unfairly larger per head shares of public spending compared to England (including Cornwall). I think that the present Barnett formula is unsustainable and remains only because UK politicians fear to stir devolutionary waters.

The Cornish political nationalists should tell us exactly what they have in mind financially for their separated Cornwall; and give us their arithmetic. It is not credible to talk about autonomy, devolution, semi-independence, and so forth, and not detail funding; without a published funding scheme nationalism is showering us in hot air and cannot be taken seriously.

Some recent comments about the Barnett formula are here (letter headed Celtic cash cow) and here (Council taxpayers in England losing out).

English and Cornish devolution 6 September 2011

Hokey-kokey devolution 14 December 2009