Gareth Young (Lewes, CEP): During Prime Minister's Question Time on 21st November 2007 Gordon Brown misled Parliament when he claimed that the Barnett Formula was based on need. His error was highlighted at the press briefing afterwards, but just two weeks ago he did it again:
We are due to publish a paper on the Barnett formula soon, but I say to my hon. Friend that the allocation of funds in the United Kingdom is based on a needs assessment that started more than 30 years ago, has been agreed by all parties subsequently, and has been followed by every Government since. It is based on the idea that we should allocate resources in the UK on the basis of need. That is the basis on which the Barnett formula exists.
Enter Lord Barnett, who created the Barnett Scheme "almost on the back of an envelope", to refute Brown's claim that the formula distributes money on the basis of need:
The current Prime Minister has frequently said in recent years that the formula is based on need but it isn't. It is based on a per-capita basis although varied slightly over the years - a very simple system, very simple but very wrong.
With Labour peers like this, who needs enemies? Very little of the pressure for Barnett reform is coming from Her Maj's Official Opposition, who well understand the problems of reform for the prospects of the Union. It is Lord Barnett and Welsh MPs (who see Wales losing out vis-à-vis Scotland) that are making much of the running. But as if that wasn't bad enough the most stinging criticism comes from Labour MPs in the North West and North East heartlands. MPs like Graham Stringer and Ronnie Campbell, whose constituents look north enviously at profligate Scottish spending, would like to see the Barnett Formula extended to English regions.
Up north the Scottish Government doesn't want reform of Barnett, they just want it scrapped, because they sense that a greater degree of fiscal independence for Scotland would accelerate the break up of the United Kingdom. And of course there's that black gold; which by rights is Scottish, so surely no one would object to a financially independent Scotland taking all the tax receipts from oil? The Barnett Formula was introduced to allocate funds on a fairer basis, but the desired cohesive effect on British unity has all but disappeared since devolution, and with it English magnanimity and goodwill that sustained it.
The Wendy Commission will examine how the Scottish Parliament could assume greater tax and spend powers to free it from the centralising constraints of Barnett and the UK Treasury's spending plans (more sop to the nationalists). This will make Scottish MSPs more accountable for the money that they spend but it will come with a concomitant loss of accountability for those Scots who sit in cabinet in England. If Scotland funds its devolved portfolio from taxes raised directly then a proportion of the money available to the Treasury to be spent in England becomes manifestly not Scottish. Or to put it another way, that tax money becomes English: No taxation without representation!
In the absence of a centralist formula that ties Scotland, Wales and Northern Ireland to English spending plans it becomes increasingly difficult to justify non-English MPs voting on English legislation. The West Lothian Question and Barnett Formula are intricately tied. Gordon Brown must resist calls for financial federalism because the logical extension of that is political federalism, and the English elephant in the room will become even more embarrassingly apparent. But address the unpopular formula he must.
Under the circumstances the only option that he can realistically pursue is a needs-based formula that can be extended to the English regions. But as 'the regions' are without personality and undemocratic this again raises the question of accountability, which may partly explain Brown's obsession with some form of regionalism for England.
The Barnett Formula was unfair before devolution, but devolution has given Scotland, Wales and Northern Ireland the opportunity to reject central policy (the 'English' NHS privatisation agenda for example) and differentiate themselves from England in a way that makes many in England envious. As English hospitals have the ground sold from beneath them, to be leased back in perpetuity to the English NHS, Scotland looks on in the knowledge that they will benefit from the Barnett consequentials as Brown sells off England's furniture to top up the UK pot.
The real question of accountability is not up at Holyrood.
Comments
Bellacaledonia, I take your point: I'm not really very attuned to how people feel about this north of the border.
Of course, the other way Brown might / could attempt to placate English grievance about higher public expenditure per head in Scotland (all these conditionals; we don't really know what he's going to try to make stick) is by making the Scottish people pay more towards their higher spending in exchange for more tax-raising powers: 'OK, you've asked for the powers; now you'll have to pay your way a bit more - and take the electoral consequences for the higher taxes you'll need to fund your programme'. In those circumstances, one way to alleviate the extra Scottish tax burden would be to run more things from Westminster / UK taxes.
Maybe.
David, aka Britology Watch
I believe Gordon Brown's stated position is that the nations of Europe should be sovereign and pool that sovereignty where it is useful or beneficial to do so.
Regardless of your views on the EU that's a fairly straight forward point of view if we take it at face-value.
My view is that sovereignty should rest with England, Scotland, Wales and Northern Ireland, and those nations should choose to pool their sovereignty where it is useful or beneficial to do so.
That to me is the elusive Britishness that Brown is searching for: the common interest of peoples that share the same land mass, head of state and currency (amongst other things). But that common interest needs to be defined by the people, not prescribed by Brown and a bunch of Fabian 'progressives'.
Rather than attempting to define a pseudo-Britishness and set it in stone it would be better and more valuable to have it rest on a basis of mutual consent. Sovereignty should be handed up to Britain, not handed down.
Part of Brown's problem is that he fails to connect up there, or down here.
To us he's very Scottish but seeks to convince us he's one of us: a Britisher (which increasingly we English are not).
To the Scots he's a Britisher trying to convince you he's as proud of being Scottish as Alex Salmond.
He ends up falling between two stools and being nothing to anybody.
This is no garden path - more of a motorway. The EU is a structure of Regions (not states). Already England is referred to as the "English Regions" in official papers.
David, you wrote: "He may therefore wish to take environmental policy and security (including justice) back into central government control."
I can assure you that this would be the death-knell of Labour in Scotland. This is simply politically impossible.
"Perhaps this is indeed Brown’s way to counteract charges of unfair treatment of England that might result from Scotland having greater tax-raising powers relating to these more ‘domestic’ matters while England’s..."
That may be how you see it but believe me its not the view from up here.
Gareth, He was definitely referring to the UK - although in terms reminiscent of the usual claimed benefits of membership of the EU. The full context of the words I quoted was as follows: "There is no Scotland-only, Wales-only, England-only solution to transnational challenges that range from terrorism to foot and mouth disease, and from avian flu to security and climate change. So for these islands an environmental Union, a security Union and a Union for defence is to the benefit of all.
"The advantages of our economic Union - with no barriers to collaboration in trade, in enterprise and scientific invention, and in education - are also well understood and go far beyond the considerable benefits of European membership."
So he curiously refers to the Union (as in the UK) as dealing with 'transnational' issues, which makes the countries of the UK 'nations' - strange admission. And he also describes the UK as an 'economic Union' (alongside an environmental, security and defence Union), which is obviously a term more familiar in the EU context - but again, implying a coming together of different nations rather than a 'Britain of nations and regions'.
As you say, Gareth, no reason or logical coherence whatsoever. I thought about my response to your post a little more after hitting the submit button for a second time (!). It seems to me that what he may wish to strip from Scottish and Welsh devolution is any of the elements which, precisely, are those that are typically the responsibility of nation states and which are contributing to the development of national identities separate from Britishness - e.g. environmental policy, which involves agreements between states at the EU level; policing and justice; defence, etc. The other parts of government (e.g. housing, education, health) can be seen as not properly 'national' or nation-defining matters: they can just as effectively, perhaps more effectively, be dealt with at a regional or even local level. This would mean that under the supposed shake up of devolved government I am hypothesising about, Scottish and Welsh governance would effectively be turned into regional governance; which would make the establishment of an equal level of governance in the 'regions' of England no longer as threatening to English national identity as they've been seen up to now. This is because Scottish and Welsh governance would no longer have the character of 'national' governance that was being denied to England: they'd be effectively regional in their responsibilities and relation to central government, even if not regions in name. Hence, the 'Britain of nations and regions' would really mean a 'Britain of regions - some of which correspond to the traditional lesser UK nations'.
Then English people would be perfectly at leave to continue to uphold their national identity as a merely cultural thing; but there'd be no English civic and political institutions. Whether this would wash with the majority of English people is another matter - but then, the UK government doesn't have to work with the majority will of the people in any case; so he could get away with it.
David, aka Britology Watch
He talked recently of “an environmental Union, a security Union and a Union for defence”.
Are you sure he wasn't talking about the EU?
In another speech he would claim those to be cross-national issues where we should pool sovereignty. So why not England, Scotland, Wales and Northern Ireland. It seems to me that he just tailors everything he says to suit his Britishness agenda and there's no coherent ideology, logic or philosophical case for any of it.
. . . continuation from above comment (hit 'submit' button in error) . . . taxation and expenditure in these areas continued to be dictated by the votes of unaccountable Scottish and Welsh MPs. Brown's blueprint could appear to be: UK matters, on which MPs from all over the UK are elected and entitled to a say are those where action is best taken across, and on behalf of, the whole of the UK (environment, security, defence, justice, international affairs); devolved matters are the rest - and if you English want parity with the Scots and the Welsh, the only way you're going to get it is through elected regional assemblies.
Clever but pretty much the last trump in his hand for saving the Union, I'd say.
This is what makes me think that Brown might want to tweak the devolution settlement in exchange for ceding more revenue-raising powers to Holyrood. He talked recently of "an environmental Union, a security Union and a Union for defence". He may therefore wish to take environmental policy and security (including justice) back into central government control. These are matters where there is a more compelling case for co-ordination on a UK-wide level than, say, health and education that can be more easily devolved to a national (and for England, of course, regional) level.
Perhaps this is indeed Brown's way to counteract charges of unfair treatment of England that might result from Scotland having greater tax-raising powers relating to these more 'domestic' matters while England's
“There is no Scotland-only, Wales-only, England-only solution to transnational challenges that range from terrorism to foot and mouth disease, and from avian flu to security and climate change. So for these islands an environmental Union, a security Union and a Union for defence is to the benefit of all.
Worth remembering that quote as an example of his recognition , explicit in this case , of England as a nation .
[...] Barnett problem pushes Brown down regional garden path [...]
"If Scotland funds its devolved portfolio from taxes raised directly then a proportion of the money available to the Treasury to be spent in England becomes manifestly not Scottish. "
It is more than "a proportion" , it is the great bulk of Treasury expenditure.
Another effect will be that the Treasury , so far seen as a British institution rapidly goes back to being , mainly what it used to be since the middle ages ie an English institution even allowing for its continuing overseeing of British expenditure such as defence .
This then begs the question that if the Treasury becomes the English Treasury then should there not be a separate treasury-like institution for specifically British expenditure . In this way the movement towards an effectively federal British state will be shoved forward quite dramatically regardless of Brown's strivings on the matter .
You are right that if this happens it will highlight even more so the anomaly of the English Treasury being dominated by Scots with no mandate in England .
It puzzles me therefore that Brown is flirting in any way with the idea of fiscal independence of England and Scotland since once it is established things it could move quite rapidly in a way that I, as an English nationalist will approve but he,as a clinging unitary-statist British/Scot will not.
He could find things slipping away from him more quickly than he ever anticipated.
[...] Barnett problem pushes Brown down regional garden path [...]
Ironically David Brown is currently blocking tax varying proposals, see Iain MacWhirter here:
http://commentisfree.guardian.co.uk/iain_macwhirter/2008/04/local_interference.html
I had to laugh at:
"OK, you’ve asked for the powers; now you’ll have to pay your way a bit more"
There is a fundamental disagreement about the reality you describe.
I have to say I found Sark an incredibly creepy place, probably the closest real life parallel to the Village in "The Prisoner". All smiles and carts on the surface, tax evasion and historical revisionism underneath.
There's an article in the Spectator - Shame on Scottish Tories for their Vichy sell-out - that touches on this too.
I think there's a disagreement about how Scotland should be taxed, but there's a general consensus that Barnett should be scrapped, and a consensus that if Scotland wants more progressive and generous social provision than England it should pay for it itself.
Mike, as far as I know the only people who support the Barnett Formula are people like Gordon Brown, and they do so not out of support for the formula itself - because they cannot justify that and nor do they attempt to - but for purely political considerations.
English and Welsh public opinion would like to see an end to the Barnett Formula as it now stands.
You may have a different take on Scottish public opinion but paradoxically - given that they do rather well out of the 'Formula' - the Scottish Government would love to see it scrapped because it is part of the glue that binds them to Westminster. What they don't want is reform to a needs-based formula that could see them lose out to Wales and English regions.
The only defence of the Barnett Formula comes in the form of stupid soundbites like Gordon Brown's above. Any politican launching on a vigorous ethical defence of the Barnett Formula would be laughed out of Parliament.
Hi Gareth, not sure where this consensus you describe lies ,or what sums it is based on.
Btw - if I were Gerald Warner or the Spectator I'd be seriously worried about the legal implications of the piece you pointed out.
Mike
for Bella Caledonia
Hi Gareth - I think maintream social democrats and unionists would dfefend the Barnett Formula in Scotland, and, as you say Nationalists and Republicans want a complety different settlement.. The issue is more complex than you suggest. One reason that spending is higher in Scotland for instance is the very different geography of, say, the Western and Northern Isles. It IS also based on need, and Scotland has disproportionate issues of health, poverty and poor housing, or what scurrilous nationalists call 'the Union dividend.'
Mike,
I wouldn't dispute that the Barnett Formula was based on need but that is not the same as saying that it is a <needs-based formula.
I'm not one of these English nationalists that says that Scotland should get less than England in per capita spending. I think that the United Kingdom should have money spent on it according to need; and I don;t think that happens at the moment.
I honestly think that Scotland gets more than it is entitled to for historical and political reasons.
It's basically a bribe.
This has to stop. The question is whether the Union can stand a re-nogotian on English terms, And it;s that the Raj are worried about.
I should be grateful if you are able to amend what I wrote on April 13th, please.
My apologies to Sark. I inadvertently gave the wrong information.
Corrections:-
1. Delete 'referendum' and replace with 'through an independent Opinion Poll'.
2. delete 'unelected landowners' and replace with
'elected landowners'.
Add - just above 'So destroy England's:-
In contrast to the governments' requirement of Sark to have
'only one class of (Assembly) Member',
by using the votes of unaccountable (to England) MPs for Scots constituencies, to provide the majority needed to impose laws on England which would not be imposed without those votes, the government has created
two classes of Members of Parliament at Westminster:-
-one accountable and fully democratically elected and
-one unaccountable, unelected and unacceptable.
Many thanks!
The Barnett Formula is being used to divert from the true injustice - loss of England's democracy.
Democracy - a system of government by the whole population, usually through representatives who are accountable to those they represent.
Being accountable they can be voted out of office at the next general election if the electorate do not like the laws which they have imposed on them.
The UK was an accountable democracy until the Scotland Act and Scotland's devolution which destroyed England's accountable democracy whilst strengthening Scotland's.
The votes of MPs for Scots constituencies are now often being used to provide the majority needed in order to impose laws on England, where they are not accountable, and which are not imposed on their own constituents in Scotland.
One example of this, amongst many, is the vote to impose charges for their higher education on students born in England. Students born in Scotland receive their higher education free of charge.
Vote to impose - 316. Vote against imposition - 311
Number of Scots MPs who voted to impose - 56 - out of a total of 57. The number of Scots MPs returned to Westminster has since been increased to 59.
In this way, with over 80% of the UK population, England is subjugated to Scotland.
The numbers are quite clear. Without the votes of those Scots MPs England's students would not now be having to pay for their higher education.
As these same Scots MPs are not accountable to any of the English constituencies on which their votes were used to impose those charges as no one in England can vote them out of office -
England is no longer an accountable democracy.
Without accountability, there is no democracy.
Therefore, England is no longer a democracy.
I believe the following confirms that the three main political parties are fully aware of this situation -
- They each support and contribute to The Westminster Foundation for Democracy which supports and helps to implement the introduction of accountable democracy in emerging countries. It states:-
"The presence of an institutional party system means that society can hold politicians to account for their performance in office and their role as the people's representatives".
- The government, through Jack Straw, recently instructed the island of Sark that she must become an accountable democracy by the end of 2008.
This has parallels with England's situation. Briefly, through a referendum, the people of Sark voted for a fully accountable Assembly. Instead, Chief Pleas decided that, in addition to Assembly members elected by universal suffrage, some seats in the Assembly would be reserved for unelected landowners.
Jack Straw instructed that he "- - would not accept that alternative composition but would wish that the will of the people of Sark be respected and for there to be a fully democratic Assembly with only one class of member".
In contrast to this, his government does not respect the will of the people of England because it finds it expedient to refuse England a fully democratic Parliament by using the votes of unelected (in England) Scots MPs to override the will of the people of England and the will of England's MPs by imposing laws which would not be imposed without their votes.
So, destroy England's accountable democracy but force or encourage everyone else to introduce it.
The Scottish National Party MPs at Westminster gave their reason for voting to impose charges for their higher education on students born in England, even though their student constituents receive their higher education free of charge, as
" - - changes in expenditure on higher education in England and Wales would impact on Scotland's block grant; (The Barnet Formula), and thus on the level of public expenditure in Scotland".
This refers to The Royal (Kilbrandon) Commission on the Constitution which sat from 1969-1973 with reference to proposed, but never implemented, constitutional changes of that time, not today, when this reason, surely, can't be relevant because of the human rights and equality laws which are now in place but which were not in place in 1973?
I do not believe that Scotland's people are to blame for England's situation, I believe politicians are.
England should be treated equally with Scotland by having her ACCOUNTABLE DEMOCRACY RESTORED through being GIVEN HER OWN PARLIAMENT which would be fully accountable to England and which could argue, with credibility, England's case for funding.
Taking this action would strengthen, not weaken, the Union, which I do not want to see break up.
Once England has her own parliament she would be in a position to make her own decision as to whether, or not, she is split into regions.
If she is split into regions before she has her own parliament, she will be weakened still further.
Restoration of her democracy and creation of her own parliament will, probably, be out of reach. Is this what the government is aiming for?
Now we come to the Barnett Formula.
Scotland has the option to raise a 3p in the £ income tax but chooses not to do so, instead,
England's taxpayers currently subsidise her to the amount of £1,500 per head of population more than the English average.
This subsidy is then used to pay for free, or heavily subsidised, services which are denied England, such as free higher education for students born in Scotland and free, or heavily subsidised, care for Scotland's elderly.
On many of England's families the burden is substantial especially where, after having been taxed to suppy Scotland with free or heavily subsidised services, their children incur heavy debts in order to obtain higher education and their parents and grandparents homes, together with what little savings they have, are taken from them in order to pay for their care.
I don't understand how Gordon Brown can argue
that this subsidy is based on need because, through this formula, post devolution for Scotland, I believe -
The wealth of Scotland's families is being preserved.
The wealth of England's families is being taken from them.
How long will it be before economists begin to calculate and compare the effects on the wealth of families North and South of the Border of these financial burdens on England?
Economic reports I read recently state that, even with North Sea oil revenue in return for the Barnett Formula subsidy, Scotland would have a small balance of payment deficit. If the reports are correct, in the present economic climate, that deficit would increase, which is possibly why Scotland is arguing to retain the subsidy rather than exchange it for oil revenue!
The situations I outline above cannot be maintained without the co-operation of MPs for English constituencies.
When are they going to act in the interests of their constituents and refuse all further co-operation until England is treated fairly and equally with Scotland?
Ray, I appreciate your reply.
I gather that you are quite happy that England's democracy has been taken from her in the name of Scotland's devolution and that none of the three main political parties have any plans to restore it.
This is a constitutional issue of huge importance to England's future far, far greater than any other question that has evolved from the devolutionary process. It will continue to impact on England until it is resolved.
We take our democracy foregranted at our peril!
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