£1 billion plus – The cost of London Labour to Scotland

Michael Matheson

SNP MSP for Falkirk West, Michael Matheson has hit out at the £874 for every family in Scotland denied to Scotland by the Westminster Labour Government.

Michael Matheson was referring to criticism of the UK Labour Government’s unreasonable behaviour towards Scotland in proposing to withhold spending from Scotland to the tune of over £1.2 billion.

This figure amounts to £874 for every family in Scotland.

Money which should quite rightly be part of the Scottish budget which the UK Labour Government is proposing to withhold from the Scottish Government include.

  • The threatened loss of £400 million from Council Tax Benefit money if Scotland goes ahead with abolishing the unfair Council Tax as voted for by the Scottish Parliament. This is despite post-devolution Treasury documents stating it is an integral part of Scotland’s funding arrangements, the Scottish Block.
  • £120 million of Barnett consequentials from £1.2 billion spending on prisons south of the border from the “reserve”. Under Barnett spending increases on prisons south of the Border generates 100% Barnett consequentials and therefore an additional £120m for Scotland.
  • £342 million less for the Scottish budget because of changes in the health baseline by Alistair Darling in his much delayed Comprehensive Spending Review. This was the worst financial settlement for Scotland since devolution.
  • Over £184 million from Lottery Funding for Good Causes that was withdrawn to fund the London Olympics after a vote in the House of Commons. This was supported by both local Labour MP’s, Eric Joyce and Michael Connarty.
  • The threatened loss of some £165 million in Barnett consequentials from London Olympic Regeneration spending. This is money for regenerating areas of London where the games will take place and outside direct funding for the games.
  • £8.1 million of compensation from DEFRA for farmers and crofters which was withdrawn when Gordon Brown postponed an election in October. This was originally in a draft statement by Hilary Benn but excluded from the final statement.
  • £370,000 which the Ministry of Defence is demanding from Tayside and Fife constabularies for security costs of the G8 and St Andrew’s summits. The previous Lab/Lib Executive also believed this to be unreasonable and the issue was inherited by the current government.

Commenting Mr Matheson said:

“The UK Labour government is behaving entirely unreasonably towards Scotland and we can now quantify that in pounds, shillings and pence.

“But as the polls on party ratings and independence indicate, London Labour’s bullying attitude towards the Scottish Government and Scotland is backfiring badly.

“Scotland is clearly short-changed in a whole variety of areas to the tune of £874 per family – and the SNP will do all we can to ensure that Scotland gets just treatment from Westminster.

“This situation also reinforces the need for a democratic referendum on our future, and the need for the Scottish Parliament to be responsible for all revenue and spending.

“And the polls are all pointing in that direction – the surge in support for independence shows that the negative attitude being shown to the Scottish Government and Scotland by the UK Labour government is getting a strong reaction.

“The more that Westminster tries to lay down the law to Scotland, the greater the support there will be for independence and equality for Scotland.

“It is also clear that Scotland needs strong representation at Westminster to stand up for our interests.

“In what could be very tight arithmetic at Westminster after the next election, the bigger groups of SNP MPs that all the polls forecast will be returned could well hold the balance of power. In these circumstances, all the areas where Westminster is currently saying No to Scotland would very quickly change to Yes.”

The money being or proposing to be withheld is:

CSR – £342,000,000
Olympic Lottery Funding – £184,208,400 FMD Compensation – £8,100,000
Prisons – £120,000,000 Olympic Regeneration Funding – £165,000,000
Council Tax Benefit – £400,000,000
G8 and St Andrew’s summits – £370,000

TOTAL – £1,219,678,400.00

2. £238 per man woman and child in Scotland. (Using GROS 2006
population estimate of 5.12 million)

Or £874 per family (assuming family size of father, mother and 1.67
children – GROS – 2006)

3. Background:

a. CSR

b. Olympic Lottery Funding

c. FMD Compensation

d. Prisons Funding

e. Council Tax Benefit

f. Olympic Regeneration Funding

It is estimated that £1.7 billion has been allocated for Olympics
budget for regeneration of areas of London which last years beyond the games.
This would create Barnett consequentials of around £33 million a year
over the five years to 2012-13.

g. G8 and St Andrew’s summits

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