Subsidising the Scots
A COUPLE of columns ago I mentioned the West Lothian Question – why can Westminster MPs with Scottish constituencies vote on matters that affect England and Scotland differently? I pointed to the Scottish Parliament s decision to allow free personal car
A COUPLE of columns ago I mentioned the 'West Lothian Question' - why can Westminster MPs with Scottish constituencies vote on matters that affect England and Scotland differently? I pointed to the Scottish Parliament's decision to allow free personal care for the elderly in Scotland, something not available in England and which has not required the Scottish Parliament to use its extra tax-raising powers.
Since then I have been doing some research into Government finances in Scotland. The last year for which I have figures is 2003-4, and those figures show that we English taxpayers are subsidising the spending of the Scottish Parliament to a frightening extent.
Since the Scottish Chancellor came to power in 1997, the annual subsidy from England to Scotland has more than doubled, and now stands at £2,200 per head. Incidentally, I refer to him as the 'Scottish Chancellor' on the same basis that actors call Macbeth the 'Scottish Play' - in my circles, it is considered bad luck to say the name out loud.
Thus for the year I mention, spending in Scotland reached £45.3billion, whereas only £34billion was collected in tax. The gap of £11.3billion had to be filled by the English taxpayer, as Wales and Northern Ireland are similarly heavily subsidised.
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Those figures do not include North Sea oil and gas. But, even if Scotland had retained every penny of tax raised offshore, the gap (and therefore the subsidy) would still have been about £7billion.
State spending in Scotland was more than 50 per cent of the total economy in 2003-4. It was expected to reach £51.6billion (or 52.2 per cent of the national economy) in 2004-5. That is not only higher than the UK figure of 45.2 per cent, it is higher than any developed country except Sweden, Denmark and France. At the same time, Scotland has the seventh lowest tax take among the world's 30 most developed countries.
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Despite the frightening costs of free personal care for the elderly and no university tuition fees, the Scottish executive regularly comes in with an underspend. They simply cannot spend the money as fast as we are being made to give it to them.
So, if our MPs can be persuaded to address the West Lothian Question, perhaps they could also take another look at something called The Barnet Formula - that is the financial formula that gives Scotland the largesse outlined above.