Scotland politics

'No Barnett formula money for Scotland' through DUP deal

theresa may and arlene foster Image copyright Getty Images
Image caption The agreement will see Arlene Foster's 10 DUP MPs support Theresa May's minority Conservative government

There will be no additional funding for Scotland or other parts of the UK as the result of the deal struck between the UK government and the DUP.

The agreement will see an extra £1bn for Northern Ireland in return for the DUP backing the minority government.

But Downing Street said the money will not be subject to the Barnett formula.

Scottish Secretary David Mundell has previously said he would not support funding which "deliberately sought to subvert the Barnett rules".

Speaking to BBC Scotland last week, he added: "We have clear rules about funding of different parts of the United Kingdom.

"If the funding falls within Barnett consequentials, it should come to Scotland."

Mr Mundell was also quoted in newspapers over the weekend as saying that he would block any "back door funding" for Northern Ireland if it meant the other devolved nations missing out.

Downing Street said the Barnett formula does not apply to the new money as it is being provided as an addition to the Northern Ireland Executive's block grant.

In a similar way, the formula did not apply to city deals in Scotland and Wales, or previous packages of support for Northern Ireland, a Number 10 source said.

The city deals saw £500m spent directly in Glasgow, £125m in Aberdeen, and £53m in Inverness, but the investment did not impact on Barnett consequentials elsewhere in the UK.

Image copyright Reuters
Image caption David Mundell has previously said he would oppose any deal that "deliberately sought to subvert the Barnett rules"

Scottish Conservative leader Ruth Davidson argued it was "absurd" to criticise UK government spending on top of Barnett in Northern Ireland, when "the exact same thing happens in Scotland".

But Scotland's First Minister, Nicola Sturgeon, claimed the "grubby, shameless deal" showed that "the Tories have shown that they will stop at nothing to hold on to power - even sacrificing the very basic principles of devolution."

She added: "By ignoring the Barnett formula, Scotland will be missing out on an estimated £2.9bn in funding for our public services - that is the price to Scottish taxpayers for the Tories to stay in power.

"This breaks the very principles that underpin devolution and the funding settlement the Tories pledged to protect."

Analysis by Brian Taylor, BBC Scotland political editor

It was not the opposition parties who insisted, initially, upon the application of the Barnett formula in relation to any putative DUP deal. It was the Secretary of State. For Scotland.

In advance of today's deal, David Mundell said there were rules about funding in the UK. Clear rules. And, he added, if the funding fell within the scope of Barnett then cash should come to Scotland too.

Indeed, he signalled that he would contest any deal which breached that position.

Pedants that they are, Mr Mundell's rivals now want to hold the Secretary of State to his word. They say he should join them - the Scottish and Welsh governments plus others - in demanding a wider distribution of cash.

The Scottish Conservative leader Ruth Davidson says this is hypocrisy. That those critics know that formula bypass is feasible. That the deal is intended to ensure UK stability.

And the line from the Scotland Office? I suspect they have had better days. But they insist that the Secretary of State was simply demanding clarity: that he wanted an upfront deal, rather than anything in any way underhand.

Read more from Brian

Scottish Labour leader Kezia Dugdale warned that the prime minister risked "weakening the bonds that unite the UK" if she did not provide extra money to tackle austerity in Scotland, Wales and the regions of England.

Carwyn Jones, the Labour first minister of Wales, said the agreement "further weakens the UK" and "all but kills the idea of fair funding for the nations and regions."

Scottish Greens co-convener Patrick Harvie called on Mr Mundell to resign as secretary of state for Scotland over the government's "shameless deal with the homophobes and climate deniers of the DUP".

And the Liberal Democrats said the prime minister had "once again put her party ahead of our country".

What is the Barnett formula?

  • Since the late 1970s the Barnett formula has been used to determine annual changes in the block grant to each nation of the UK
  • When there is a change in funding for devolved services in England, for example health or education, the Barnett formula aims to give each country the same pounds-per-person change in funding
  • But the formula is not set out in law, and in practice the Treasury decides how to apply it
  • The UK government also provides other grants to devolved administrations outside of the block grant, which are not covered by Barnett
  • These grants are for less predictable demand driven spending, and are negotiated between the UK government and devolved administrations

The deal, which comes two weeks after the election resulted in a hung parliament, will see the 10 DUP MPs back the Tories in key Commons votes.

Theresa May fell nine seats short of an overall majority after the snap election, meaning she is reliant on other parties to pass legislation, including relating to the terms of the UK's withdrawal from the EU.

DUP leader Arlene Foster insisted the "wide-ranging" agreement was "good for Northern Ireland and for the UK" and predicted it would deliver a stable government as the country embarks on the Brexit process.

The agreement will see a total of £1.5bn in funding - consisting of £1bn of new money and £500m of previously announced funds - to be spent over the next two years on infrastructure, health and education in Northern Ireland.

Mrs Foster said the money was needed to address the challenges from Northern Ireland's "unique history".

The prime minister said the pact was a "very good one" for the UK as a whole, adding: "We share many values in terms of wanting to see prosperity across the UK, the value of the union, the important bond between the different parts of the UK".