LONDON – The governments of Scotland and Wales are teaming up to launch a formal dispute against Theresa May’s deal with the Democratic Unionist Party.
Last month Prime Minister May gave £1 billion additional funding to Northern Ireland in return for the 10 DUP MPs in the House of Commons supporting the Conservative minority government on a “confidence and supply” basis.
This means that the DUP will back the government in major votes like on the budget or confidence votes, in order to keep the day-to-day business of governance in motion.
However, the administrations in Scotland and Wales argue the Barnett Formula means that May’s government must also add extra funding to their devolved budgets: £2.9 billion to Scotland and £1.67 billion to Wales, to be exact
The Barnett formula was devised in 1978 and dictates how much money the UK government should allocate to the devolved administrations based on the size of their populations and spending in England. For example, if the UK government increases the budget in England, the formula will decide how much the devolved governments will receive. Scotland and Wales argue that the same should apply to extra spending in Northern Ireland.
The finance secretaries of Scotland and Wales, Derek Mackay and Mark Drakeford, have this week written to the Treasury arguing that the extra funds handed to Northern Ireland would be spent on areas of devolved policy, meaning the rules of Barnett Formula should apply and extra funding given to the other devolved nations too.
“The Scottish government fundamentally disagrees with the way in which this additional funding for Northern Ireland has been allocated,” MacKay said on Wednesday.
“We have repeatedly made the point that all areas to which the £1 billion funding package has been allocated are devolved matters and therefore the Barnett formula should apply.”
Welsh finance secretary Drakeford claimed it was “simply inexcusable that the UK government is willing to bypass” the Barnett formula and launched a formal dispute to make sure Wales is “treated fairly”.
Responding to the news on Wednesday, a UK government spokesman said: “As we have made clear, this agreement is part of the government’s commitment to support growth across all parts of the UK.
“Like previous Northern Ireland support packages, and the funding of over £1bn for city deals in Scotland and Wales, this funding is a targeted intervention to address a specific set of unique challenges.
“And, as was the case for those previous interventions, this exceptional funding will be made outside of the Barnett funding system.”
May set for another showdown with Edinburgh and Cardiff
Since entering Number 10 May’s relationship with the devolved administrations has been tricky with Scotland under the leadership of Nicola Sturgeon, in particular, feeling its red lines on Brexit have gone ignored by UK government.
Last week Sturgeon and Welsh First Minister Carwyn Jones released a joint statement saying they would not be supporting the Great Repeal Bill unless May agrees to a number of major revisions.
The Bill – known formally as the European Union (withdrawal) bill – was published on Thursday and will see the government take all EU law currently affecting Britain and transpose it into domestic law by repealing the European Communities Act (1972).
Sturgeon and Jones argue that UK government will use the Bill as a means of seizing control of powers that ought to be devolved to the Scottish and Welsh administrations. These powers cover policy areas like energy, farming and fishing.
The pair said: “We have repeatedly tried to engage with the UK government on these matters and have put forward constructive proposals about how we can deliver an outcome which will protect the interests of all the nations in the UK, safeguard our economies and respect devolution.
“Regrettably, the bill does not do this. Instead, it is a naked power grab, an attack on the founding principles of devolution and could destabilise our economies.”