Scotland’s Fiscal Relationships with England and the United Kingdom
Scotland’s Fiscal Relationships with England and the United Kingdom
This chapter argues that it may soon go too far and stir up legitimate resentment in Scotland and Wales — precisely because it will get too close to equal per capita expenditures. It also provides the consequences on whether the imperfect integration of Scotland into the union is something to be celebrated or deplored depends upon the perspective adopted. Both the Goschen formula and the Barnett formula became at various times something for the Scottish Office to defend as a means of protecting its policy space and the perceived expenditure advantage they protected. Attitudes to formulae such as Goschen and Barnett are conditioned, partly at least, by the perceptions of the extent to which the arrangements are favourable. It then addresses how the arrangements have worked under devolution. Moreover, it considers the two questions: how expenditure is to be determined; and how it is to be funded. The example presented shows the obvious point that a UK government that wished to make the union unworkable could do so. However, it also shows that union has demonstrated a remarkable resilience and its future is properly a political choice.
Keywords: Scotland, England, United Kingdom, Goschen formula, Barnett formula, expenditure, devolution
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