The Tory Party and Joel Barnett

Wales on-line this morning contains details of an interview, the Tory Leader conducted with its readers in which Cameron promised to to “name the date” for a referendum on the Assembly’s powers and hinted at an end to the long-running row over how Wales is funded from the Treasury.

This goes a bit further than his Shadow Secretary of State on Good Morning Wales, who refused to be drawn on the referendum, saying only that it was on Peter Hain’s desk and that it was a matter for him.

However, she too confirmed that the Barnett formula was up for review, drawing attention to the fact that it no longer enjoys the support of its inventor, Joel Barnett. That it has taken her ten years to become aware of this fact can be excused by the situation she finds herself in – yet another potential Tory Secretary of State who does not represent a Welsh constituency nor live here.

This is quite a u-turn for the Welsh Tories, given that their argument in the past has been that it is dangerous to fiddle with the financial settlement in case Wales loses out. Maybe they have been encouraged by the work of the Holtham Commission, which suggested that Wales was losing out to the tune of £300 million a year, a figure which they pointed out was statistically insignificant in comparison to the £15 billion we get from the Treasury.

More likely, they are trying to appease voters in England who think that the block grant system works against them and want a change. Whichever it is there is no sign as yet that anybody in the Tory party has any idea how they will change the Barnett formula nor how they will deal with the sizeable political fall-out that will follow any change.

Perhaps I can help by pointing them to the 2005 Liberal Democrat manifesto. The Liberal Democrats are still the only party to have commited on a UK basis to reform and in doing so reconciled all its constituent parts to the proposed solution. We proposed a federal funding commission to draw up a distribution formula on the basis of need and to oversee its implementation.

Obviously, any new system could not be introduced overnight but it would be possible to ease it in over a period of years so as to reduce the pain felt by those parts of the UK that have been historically overfunded.

We will have to see where the Tories go on this and if their promise of reform actually comes off or whether it is shelved once they have got into government, if indeed they do.

Related posts:

1. Tory backbenches call for Barnett reform
2. Hain ‘solution’ to Barnett completely ignores the funding problem in Wales
3. Benefits of Fuel Poverty Bill blunted by Barnett