Barnett Formula

Lord Forsyth of Drumlean Excerpts

Thursday 13th July 2017 Lords Chamber

[Lord Bates]

We are certainly always open. That is why we spend £120 in Wales for every £100 that we spend in England. We continue to be committed to that. It is why we increased the overall capital borrowing limit to £1 billion from £500 million, and we continue to look for opportunities to grow the economy in Wales, both within and outside the Barnett formula.

[Lord Forsyth of Drumlean (Con)]

My Lords, given the Prime Minister’s emphasis on fairness and on strengthening the United Kingdom, why are the Government so resistant to taking the advice of the late Lord Barnett and of the committee of this House that looked at the Barnett formula, which unanimously concluded that Wales lost out as a result and that a system based on needs would unify the United Kingdom and be fair to England, Scotland, Wales and Northern Ireland?

[Lord Bates]

I recognise that—and of course for 40 years there has been an ongoing debate about the Barnett formula. Our response to that, as my noble friend will recognise, is to believe that we should devolve to the devolved Administrations more responsibilities and financial accountability in taxation and how money is spent in the Budget. That is the best way in which to eventually work towards a needs-based rather than population-based formula.