It was interesting to note the way in which a number of anonymous commenters on my previous post seem to have responded to what they assumed me to believe, rather than to what I actually said. (To say nothing of the implicit assumption that anyone who raises any question about the Barnett formula is somehow expecting 'the English' to pay for Wales). I suppose it also does much to justify the fears of those who think it a mistake to raise the issue at this time.
In this regard, it is a pity that the people of the North East of England rejected the Regional Assembly which was on offer to them in 2004. Had that Assembly been established, I think we would have been debating Barnett in a wholly different context, because that new Assembly would also have been raising it as an issue.
There are really only two ways ahead for funding the devolved administrations within the UK. The first is that they are allowed to raise their own taxes, and the second is that they continue to receive a block grant from central government in London.
The first is an entirely rational viewpoint to hold, but implies that self-government goes further and faster than many are ready to accept. The second treats the issue as a UK-wide issue of deciding how to allocate resources to the devolved administrations. My original post started from the assumption that the issue is going to have to be addressed in the latter context, rather than the former.
Much has been made about the fact that spending per head on the areas covered by the Barnett formula (which is not at all the same thing as total government expenditure per head) is higher in Wales, Scotland, and Northern Ireland than in England. Whilst this is incontrovertibly true, it overlooks the fact that there are variations in spending per head within those countries as well – and within England itself.
Spending variations on specific policy areas within the territory of any administration are an entirely natural way to run a country, mirroring needs and circumstances. Some services cost more to provide in rural areas than in urban areas; others cost more in urban areas than rural. Levels of chronic sickness (and therefore health service costs) are not constant across all the nations and regions of the UK. ‘Fairness’ in allocation of resources, does not necessarily equate to ‘equality’ of allocation of resources, considered purely on a ‘£ per head’ basis.
That is particularly the case when one looks at only a subset of government expenditure rather than the totality. In the areas of devolved responsibility, it is clear to me that expenditure is higher in Wales, Northern Ireland, and Scotland than in England as a whole (although treating England as a single unit in this context masks significant regional differences there as well). Whether the same is true in non-devolved areas of expenditure is a moot point, to which none of us really knows the answer – although of course many claim to do so, based largely on their own political standpoint.
The problem with all this is that, and here I agree with Glyn Davies' response, working out a needs formula is far from being a simple matter. And, returning to my original post, even if a Wales-based review comes up with a consensus view, there seems to be little political prospect of it then being accepted and implemented at a UK level.
And that brings me back to my central concern. If we see Barnett as being a UK issue, to do with how we determine the 'fair' level of resources to be allocated to the nations of the UK (yes, and to the regions of England as well), then it needs to be reviewed at a UK level with buy-in from all concerned, and some sort of commitment to implementation (what Glyn Davies described as ‘binding’). To conduct a review from a purely Welsh perspective - which is what the Assembly government has decided to do - runs the risk of producing a fine report which then gets ignored.
Such a conclusion might give us increased scope for political discussion and argument, and might even allow us to base that discussion around a more objective view, rather than political prejudice - but it won't resolve the issue of fair funding for the Assembly.