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Spending - the counter argument

Brian Taylor | 17:18 UK time, Wednesday, 12 September 2007

More on spending. Here’s the perspective from inside the UK Ministerial tent. They counter the concern being voiced as to the impact on the devolved territories: Scotland, Wales and Northern Ireland.

By coincidence, the Northern Ireland Finance Minister Peter Robinson is in London today for talks with the Chief Secretary to the Treasury, Andy Burnham. It’s part of a series of bilateral negotiations.

The line from Whitehall is that absolutely nothing is being done which unfairly works against Scotland (or the other devolved administrations.)

It’s said that Scotland argued that their spending increase should be based upon a particular base line - while the Treasury insisted, as in the past, upon a lower base line, excluding exceptional items.

It’s said further that some departments of the UK Government in Whitehall will get no increase. Others - particularly health - may get a significant increase.

Scotland, as in the past, will receive the standard Barnett consequentials - that is, a proportion based on population of the increase or decrease in comparable Whitehall departments. Broadly, those English departments which match the powers devolved to Scotland.

The line is that Scottish Ministers are basing their claims of a potential shortfall upon their own inflated calculation of what Scotland gets now, of the existing spending baseline.

In other words, Scotland is starting from a different - and erroneous - point to that used by the Treasury.

One UK Government source said that to suggest Scotland would suffer disproportionately was “a mis-statement - what others might call a lie.”

Presumably, we will all be able to judge, dispassionately, once the figures from the Comprehensive Spending Review are published.

Comments

  • 1.
  • At 08:06 PM on 12 Sep 2007,
  • Scamp wrote:

Given the opportunity Scotland would vote against spending on Trident and would have voted against the Iraq war.

Why then should Scotland have to suffer from Blair/Brown's mishandling of general economic strategy.

  • 2.
  • At 09:13 PM on 12 Sep 2007,
  • Christian Schmidt wrote:

Hmm, surely a key question here is, has the baseline been reset at previous three CSRs, and if so was the outcome positive or negative for Scotland?

If changes to the baseline are usual, then the Scotland cannot really complain.

If however this would be very first baseline revision in a CSR and have a negative effect on Scotland, then I think the conclusion this is London Labour penalising the Scottish people for voting SNP is valid.

So, anyone knows the history of CSRs and their baselines?

  • 3.
  • At 09:21 PM on 12 Sep 2007,
  • Christian Schmidt wrote:

Hmm, surely a key question here is, has the baseline been reset at previous three CSRs, and if so was the outcome positive or negative for Scotland?

If changes to the baseline are usual, then the Scotland cannot really complain.

If however this would be very first baseline revision in a CSR and have a negative effect on Scotland, then I think the conclusion this is London Labour penalising the Scottish people for voting SNP is valid.

So, anyone knows the history of CSRs and their baselines?

  • 4.
  • At 09:40 PM on 12 Sep 2007,
  • PMK wrote:

More lies from the UK Government - WMD anyone?

  • 5.
  • At 11:49 PM on 12 Sep 2007,
  • Gregor Addison wrote:

If ever there was a reason why Scotland should control its own budget, this is it. A party in power in Holyrood is despised by a party in power at Westminster, so Westminster does everything it can to make the party in power in Holyrood look weak. This squeeze on Scottish spending affects everyone in Scotland and how Labour can claim to care for the well-being of Scottish voters is beyond me.

  • 6.
  • At 08:39 AM on 13 Sep 2007,
  • Peter, Fife wrote:

Methinks this is yet another instance of Gordon Brown with the latest recruit of Alistair Darling striving to prove their Britishness, as opposed to their Scottishness; will we see yet again support and congratulations for the England football team’s performance which in itself may go some way to bolstering Steve McClaren's and Gordon Brown’s prospects.

Whilst Gordon Brown and his puppet at the Exchequer may feel they are dealing with the unrest that exists in England, Re the Barnett formula and calls for an English Parliament for English only votes it must be as plain as the nose on his face that he is clearly playing into the hands of Alex Salmond and the Scottish Nationalists.

The murmurings and unrest are already being voiced in Scotland, true I have not sampled all of Scotland, but when individuals who could most easily be categorised as ‘middle of the road’ are now expressing alarm there is clear concern for a more negative Westminster feeling to be created by future policy decisions.

Where will Wendy Alexander stand on such a decision making process, will she be silent and subservient to London as was truly seen in the acts and deeds of her predecessors or will she offer up mock opposition to prove she is not Gordon’s poodle?

All in all this is dangerous ground for a self declared Unionist to be treading.

Congratulations to Alex McLeish and the team for last night’s performance and result.

  • 7.
  • At 10:47 AM on 13 Sep 2007,
  • Malcolm wrote:

I think the comments by Wendy Alexander are very instructive. She has stated that Labour should heed "English anxieties" concerning the determination of the Scottish block grant. Since Wendy is part of Gordon Brown's very small circle we can conclude two things;

1. Scotland is being punished for voting SNP whilst the English are being appeased.

2. A May 2008 election is being planned on the backs of this year's spending review and the forthcoming budget in March 2008.

PS I think Gordon Brown will lose both in England and Scotland.

  • 8.
  • At 11:07 AM on 13 Sep 2007,
  • Ewen McPherson wrote:

OK, the Nats could be falling into a huge beartrap here if McBroon and McDarling suddenly pull an increase out of the hat instead of the suggested "stringencies".

Aye, Right Enough !

But is it just me or is there a huge and deafening silence coming from the soon-to-be-anointed Leader of the Labour Contingent in the Scottish Parliament ?

Could she perhaps show a bit of backbone and drop a hint or two that "stringencies" are not what Scotland needs and that there might be a degree of dissatisfaction within the "Scottish" party ? A show of defiance now at the start of her holding of the chalice may be worth those few extra votes in four years.

To quote myself....

Aye, Right Enough !

  • 9.
  • At 11:46 AM on 13 Sep 2007,
  • Neil wrote:

To respond to question 1, my understanding is that the base line has previously been altered on one or two occasions (before devolution), but it has been done in response to demographic changes - in other words to bring Scotland's finances in line with its smaller than projected population.

This move represents something different in that it is an attempt to cut the Scottish base line to tighten Scottish spending without affecting English expenditure. Effectively, this renders the Barnett formula completely invalid as the formula is designed to change the Scottish budget up or down in response to spending in the rest of the UK. This takes political considerations out of the equation and bases the amount Scotland receives on government spending in the UK and keeps things equitable.

What Gordon is effectively doing is mucking around with a stable (if not universally popular) funding mechanism rather than undertaking any full scale reform. By going in ham-fisted in this way, devolved finances are set to become a major and continuing political issue.

It'll all end in tears.

  • 10.
  • At 03:59 PM on 13 Sep 2007,
  • John wrote:

How can Scottish New Labour justify this cut ? when Westminster is planning to spend so much on a replacement for trident,never mind the the millions spent in Iraq that Scottish New Labour supported.And of course OUR SCOTTISH prime minister funded.

  • 11.
  • At 04:53 PM on 13 Sep 2007,
  • Scamp wrote:

It'll end in independence more likely.

Scotland shouldn't have to put up with this nonsense from Westminster.

  • 12.
  • At 06:42 PM on 13 Sep 2007,
  • louise wrote:

When will labour voters in Scotland going to wake up to the fact that the Labour party as they knew it no longer exists. Will they beleive when:

They hear Wendy Alexander say she thinks maggie is interesting?

They hear Gordon Brown expresses admiration for Maggie?

They hear Maggie says she approves?

They see Gordon Brown welcoming Maggie Thatcher to Downing Steet?

When they see Gordon Brown treat Scotland with the same contempt that Maggie did?

When Scotand is decimated by Brown in the same way that it was by Thatcher?

If not then WHEN?

I have news for labour supporters everyone of these but the last has already happened.

  • 13.
  • At 07:46 PM on 13 Sep 2007,
  • Karin wrote:

Hope you dont have a hangover Brian

Here Is Gordon Brown talking to an england fan about the football results

http://farm2.static.flickr.com/1008/1372585377_a79c365372_o.jpg

  • 14.
  • At 09:19 PM on 13 Sep 2007,
  • Graeme wrote:

#1

Sorry but I don't think your comments stack up. I'm pretty sure that given the opportunity the English would have voted against Trident and the IRAQ war as well.

This is not to say that I don't think we should have more economic control, just that you need a better argument.

  • 15.
  • At 09:08 AM on 14 Sep 2007,
  • Jim wrote:

Spending


"When a man spends his own money to buy something for himself, he is
very careful about how much he spends and how he spends it. When a
man spends his own money to buy something for someone else, he is
still very careful about how much he spends, but somewhat less what
he spends it on. When a man spends someone else's money to buy
something for himself, he is very careful about what he buys, but
doesn't care at all how much he spends. And when a man spends someone
else's money on someone else, he doesn't care how much he spends or
what he spends it on. And that's government for you."

  • 16.
  • At 11:08 AM on 14 Sep 2007,
  • Dave "Boy" wrote:

An alternative perspective to the "Big Bad Westminster" scenario....

The SNP are in POWER in Scotland, it is their responsibility to negotiate the best possible settlement for Scotland through this review.

I'm sure they would be quick enough to take credit if an increase was achieved, same applies in reverse.

Besides, didn't the SNP commit to efficiency savings of 1.5% over and above the National target? Well, its time for them to deliver (and yes that may well mean job cuts). But why should public service be immune from these sort of cost challenges? In my line of work, we now make twice as much as we did 10 years ago, with just over half the people and a vastly reduced fixed cost.

  • 17.
  • At 05:54 PM on 14 Sep 2007,
  • Kain wrote:

15. Dave BOY.

I assume the BOY part refers to your tender years as your post is extemely niave and sycophantic. The SNP may be the Government of Scotland but as people are well aware they are a minority Government. What exactly does Dave boy suggest that the SNP uses as leverage in the negotions he proposes. Does Dave really think if they say "look gordon we really must protest about this its unfair to scotland". Does he really seriously think Gordon Brown is going to listen when he didnt listen to members of his own Party ie "the unions". Dave Gordon Brown and his chancellor decide how much money the Government of scotland will get. The people of Scotland dont get a say in the matter and that includes our Democraticallly elected governmant.
So I am afraid Dave much as you dont want it to be true it is indeed down to BIG BAD WESTMINSTER and GORDON BROWN. Do you really think the Prime Minister gives a monkeys about Scotland when you see him cuddling up to the woman who decimated heavy industry in scotland.

  • 18.
  • At 01:14 PM on 15 Sep 2007,
  • Ken Kennedy wrote:

Its glad to see the pro-independance dudes are still alive and kicking, one point, in order for Scotland to collect and administrate its own taxes it would require a treasury to be created, a discussion with westminister about exactly what poweres a nd right to gather tax this would have because at the end of the day it would mean that westminster would loose out on cash.

These would take time and more importantly massive funding a treasury dosent just grow overnight and what if the formation of this scottish treasury cost more to create and staff than the taxes collected can justify?

  • 19.
  • At 02:03 PM on 25 Sep 2007,
  • chris@161DF wrote:

if scotland becomes independant we can have our oil and not be giving money to england with it

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