In Brief

Why the Barnett formula isn't being applied to the Tory-DUP deal

Is the SNP right to argue Scotland should receive £2.9bn more now Northern Ireland will receive an extra £1bn?

When Scottish Secretary David Mundell vowed this weekend there would be no "back door" funding for Northern Ireland, he couldn't have known the stir his words would cause.

Since then, the Tories have been accused of paying a "grubby" £1bn bung to keep Theresa May in power and he is called on to resign, says the BBC

The £1bn is the upfront cost in new spending for infrastructure, health and broadband in Northern Ireland that the Conservatives have agreed to secure the support and votes of the Democratic Unionist Party's ten MPs in the House of Commons. 

At issue is the Barnett formula, the controversial mechanism used to determine the vast majority of spending in the UK's devolved administrations.

Under this, if the budget for a government department changes - health, for example, receives more or less money - the formula is used to calculate how much each devolved area then gets, based on "population proportion and the extent to which powers have been devolved" from that department.

Critics argue Barnett is not being applied to the DUP money, so there are no "consequentials" to increase funding for the governments in Scotland and Wales.

According to the Scottish National Party, if the formula had been applied so that all countries benefitted to the same degree, Scotland would have gained £2.9bn more in funding. 

"This breaks the very principles that underpin devolution," said First Minister Nicola Sturgeon.

However, the Barnett formula is not set out in law and is interpreted and applied at the discretion of the UK Treasury.

It also typically applies only to permanent funding changes for government departments, says iNews.

The government insists this new funding is an additional one-off.

Scottish Conservative leader Ruth Davidson said the same process was used when David Cameron's government agreed "city deals" for Glasgow, Aberdeen and Inverness worth collectively close to £700m. 

As now, no new money went to the other devolved administrations. 

"It's absurd for the SNP to criticise UK government spending on top of Barnett in Northern Ireland when the exact same thing happens in Scotland," said Davidson.

Barnett has come under criticism throughout its 39-year history - its creator, former Labour MP Lord Joel Barnett, claims it is unfair to people in English regions in particular

Speaking in 2014, he said the formula meant Scotland was "able to do things that we can’t like [cap] prescription charges and university fees. That’s not fair on English taxpayers."

According to figures for 2015/2016, public spending per head in England was £8,816 per head, while in Wales it was £9,996, in Scotland £10,536 and in Northern Ireland £10,983.

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