One of the ways in which Scotland does not get as good a deal as the UK government’s GERS figures would suggest is that various infrastructure projects, almost entirely in England, are classified as being for the benefit of the whole of the UK. Examples include renovating London sewers and the HS2 rail line which will not come within a hundred miles of Scotland. Although very few such projects are in, or of any significant benefit to, Scotland, Scotland gets charged a per capita share of the costs in the GERS figures, and does not receive any Barnett consequential payments in connection with them. I want to look at a slightly less obvious version of this. (Once again, I will keep the discussion simpler by pretending that the UK comprises only Scotland and England.)
The Westminster Parliament is the Parliament for the whole of the UK, and therefore it might seem reasonable that Scotland should be charged a per capita share of its running costs, but I believe there are reasons why Scotland’s contribution should be somewhat less. I shall start with the less important reason.
The nature of the job requires Scottish MPs to spend much of their time in London, and so a significant part of their expenses and some their salaries will be spent there, to the economic benefit of England. A similar situation will apply with members of the House of Lords, with the additional complication that those members who are resident in Scotland may be less likely to attend the Lords regularly than those who live in or near London, and so will collect fewer £300 tax-free attendance allowances. Apart from the politicians, the Houses of Parliament employ numerous people to clean and maintain the building, to staff the numerous bars and dining rooms (all subsidised by taxpayers) and to provide assistance to the politicians. The economic benefit from the wages of all these people goes to England, not Scotland.
Where Scotland receives a disproportionately small percentage of the economic benefit from UK government expenditure, Scotlands share of that expenditure should be reduced to compensate for this. I assume that this was at least part of the reason why the original, pre-devolution version of the Barnett formula allocated slightly more money to Scotland than would have been expected if it had been strictly proportional to population.
The most important consideration is one which should be highlighted by talk of EVEL or ‘English Votes for English Laws’. As a result of of the introduction of devolution without any move towards some kind of federal system, the Westminster Parliament divides its time between being the UK Parliament and being a de facto English Parliament. (Before devolution, it also at times acted as a Scottish Parliament when debating laws that would apply only to Scotland – and there was nothing then to stop English MPs voting on such laws, no SVSL.) The cost of the Scottish Parliament is met from the Scottish budget, and so it is only fair that the cost of the Westminster Parliament, when it is dealing with matters which concern only England, should come out of the English budget.
If EVEL is introduced, it will be necessary to formally define when the Commons are dealing with UK business and when they are dealing with English business. It should therefore be possible to work out over the course of a year what percentage of the time that Parliament has acted as the English Parliament, and reduce the charge to Scotland accordingly. (One could assume that the percentages will be similar for the Lords.)
There has been talk of the need for a major renovation of the Palace of Westminster, with the cost being estimated at £3 billion, perhaps rising to as much as £10 billion (yes, £10,000,000,000) if it is necessary to move Parliament to alternative accommodation while the work is carried out; under the present system Scotland will be charged at least £250 million. Yet again, there will doubtless be very little economic benefit to Scotland from this work, even if any of the contracts are awarded to Scottish companies, but a great deal for London. Why should Scotland be paying to create jobs in England, when the reverse rarely happens? Why should Scotland pay a full share of the cost of renovating a building which for a significant part of the time accommodates an English Parliament?
I cannot help wondering whether, if the Palace of Westminster is really in such a poor condition, it would be cheaper to build a replacement elsewhere (not necessarily in London – other English cities could compete for the privilege). They could invite a foreign architect to design something a bit more up to date, preferably without bars to discourage legislating while under the influence. Then the present buildings could be converted into something like a hotel and conference centre, or, if they are as unsound as the estimated cost of renovation suggests, replaced with a nice new office block. If the reason for preferring to renovate the Palace of Westminster is to preserve a tourist attraction, then why should Scotland pay for that?