Downing Street 'bullies' critics of regional funding into silence

Nov 26 2007 EXCLUSIVE by Rob Merrick, Liverpool Daily Post

DOWNING Street is bullying MPs and peers trying to review the funding rules that deliver much higher spending in Scotland than in poorer Merseyside, the Daily Post can reveal.

Aides to Gordon Brown are running an orchestrated campaign to arm-twist politicians who have demanded a rethink of the infamous Barnett Formula.

The officials have warned of “consequences” if a full-scale review is undertaken – suggesting No.10 fears its claims that the formula is fair will unravel.

That would be disastrous for a Scots-led government, at a time when English discontent about higher public spending north of the border is already on the rise.

However, the revelation that No.10 is seeking to stamp on debate may be even more damaging to Mr Brown, who pledged to restore trust in politics after the Blair years.

Critics point out that in the last financial year, Scotland received £8,623-per-head from the Treasury, while the North West figure was just £7,798 – more than £800 lower.

Yet income-per-head north of the border was 96% of the national average in 2005, while the average North West resident received just 88%.

Meanwhile, the Scottish Parliament, thanks to higher funding from London, has announced a series of popular spending measures, unavailable in England.

Earlier this month, the SNP’s first Budget included plans for free prescriptions, a cut in class sizes in primary schools and a reduction in business taxes.

And Scottish householders will enjoy council tax bills frozen for the next three years – while bills south of the border rise faster than inflation.

In a Commons debate last week, a Labour MP who tabled a parliamentary motion calling for “an immediate review” of the Barnett Formula revealed the attempt to bully his supporters.

Graham Stringer, a former minister, said: “An official from No.10 Downing Street was going round to signatories and, without telling me, was asking them to withdraw their names because of the sensitivity of the issue.”

Now the Daily Post can reveal that similar strong-arm tactics have been used against Lord Barnett, the Labour peer who devised the formula, but has since disowned it.

The former chief secretary to the treasury said he had been told to drop an attempt to set up a Lords committee to review the fairness of the funding rules.

The planned inquiry, which is likely to get under way next year, poses a particular danger to the government, because it would be led by a respected economist.

Lord Barnett said: “What Graham said does not surprise me, because I have had that pressure myself.

“But I made clear that nothing is going to stop me setting up my committee. It is my bloody formula and it should be reviewed.”

Mr Stringer, MP for Manchester Blackley, said: “That was a profoundly wrong way for No. 10 officials to behave.”

However, in the Commons last week, treasury minister Angela Eagle, the Wallasey MP, insisted critics of the formula were wrong to say it took no account of need.

It did not determine overall spending – excluding the NHS, social security and local council grants – but merely how an increase in public expenditure was divided up between the nations of the UK.

Downing Street last night declined to comment.