The summer hiatus: what you may have missed

There have been a few notable developments since mid-July.

First, the four party leaders in the National Assembly for Wales wrote a joint letter to the Secretary of State about the long-promised ‘Calman style commission’ for Wales, calling for its early establishment with a wide remit.  The best coverage of that is on ClickonWales, here.  The letter called for the commission to start work this month, and to produce its first report on financial matters within 12 months and a further report on wider constitutional matters by March 2013.  These proposals appear to have been largely accepted by the Wales Office, in press statement of 19 July (available here) that calls for the commission to start work this autumn and complete its work by 2013.  There’s also an article about that from Cheryl Gillan in the Western Mail, here.  There is still no news about the establishment of the commission, however, but there is word of considerable ongoing wrangling between Cardiff and London about it.

Second, the Daily Mail led on Tuesday 30 August with a story about the disparities in public spending across the UK, available here.  (Well, it led with it in the English edition.  I gather the story was buried some way inside the Scottish one.)  It’s a fine example of factually accurate but substantively misleading journalism.  The story wasn’t new (it was based on looking at table 9.2 of the 2011 edition of Public Expenditure Statistical Analyses, published in July), it confused differences in spending on devolved services with that on non-devolved ones, and it talked as though such disparities would be eliminated by the adoption of a needs-based formula, not moved around.  It also conflated the funding regimes for devolved governments in Scotland, Wales and Northern Ireland with regional spending in England.  Moreover, as I pointed out HERE, any increase in those disparities will be due to the way the UK Government has chosen to protect health and education spending, which are much more important in calculating the devolved government’s block grants than they are to public spending overall.  These errors will be pretty evident to readers of this blog, and the Daily Mail is hardly the place to look for calm or reflective consideration of complex issues.  But on a slow news day (the day after the bank holiday in England, Wales and Northern Ireland), it attracted a lot of wider coverage.

The Mail isn’t the only paper to have come up with an odd answer when looking at devolution finance.  One woud normally expect better, though, of the Financial Times.  The FT reviewed the arguments for tax devolution, particularly corporation tax, in August, and in a leader on the 23rd entitled ‘Devolution too far’ (available here) rejected the case pretty strongly, for both Northern Ireland and Scotland.  Its reasoning is questionable, though.  It argues international tax competition is good, but domestic tax competition isn’t. (Maybe they should tell the OECD about that, as that body doesn’t agree – though simply reading the papers coming from its Fiscal Federalism Network might be a start).  It then reasons that corporation tax could only be devolved to Northern Ireland or Scotland if it were also to be devolved to regional governments within England – and that would require further constitutional change which it ruled out as there is no demand for it.   While there are good arguments against corporation tax devolution, this isn’t one of them, and indeed this is the sort of undergraduate logic-chopping that gets leader columns and their writers a bad name.  If we can contemplate asymmetric devolution of income tax, we can contemplate asymmetric devolution of other taxes too.  There are issues of principle about that, and plenty of administrative problems as well – but the fact that England would be left out of the equation, when that’s the choice of its elected representatives, isn’t one of them.

Third, we’ve had a relaunch of the Unionist position in the Scottish constitutional debates, with speeches by Michael Moore to the David Hume Institute (available here), and Danny Alexander to the CBI Scotland conference (here).  I’ll be writing more on those shortly.  The Scotland bill is of course about to resume its parliamentary consideration, with its Lords second reading due this Tuesday (6 September), and the new Scotland Bill Committee at Holyrood is also about to start its work.


1 Comment

Filed under Calman Commission/Scotland bill, Devolution finance, Media issues, Scotland, Wales

One response to “The summer hiatus: what you may have missed

  1. “It also conflated the funding regimes for devolved governments in Scotland, Wales and Northern Ireland with regional spending in England.”

    Much as I hate to stand up for the Daily Mail, is it any surprise that they conflate the Barnett Formula with regional differences within England? Labour and SNP politicians deliberately do the same all the time as a smoke and mirrors exercise, trying to whip up grievance within England in order to dampen English grievance against our neighbours.

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