The TaxPayers' Alliance - overegging a good argument?

I've not spent a lot of time following the activities of the TaxPayers' Alliance, an organisation which claims to be 'campaigning for lower taxes and better government' (as though these concepts are mutually inclusive...). However, my attention is drawn to their newly published report on the Barnett Formula, and the posting on it by Mike Denham in his blog 'Burning Your Money'.

Now I admit that, as a civil servant who believes in value for money and better government (two concepts which are mutually inclusive), I'm not naturally irreconcilable with the stated aims of the TaxPayers' Alliance, i.e. to expose waste in our public sector. However, if their report on the Barnett Formula is anything to go by, they've decided that going for the cheap, inaccurate shot is easier than making a meaningful case.

Mike Denham starts by a headline that claims, "The Barnett Formula has cost taxpayers £200 billion". This is broken down as follows:

• Scotland - £102 billion


• Wales - £43 billion


• Northern Ireland - £57 billion

Errr... doesn't that mean that there has been a transfer of £202 billion from England to Scotland, Wales and Northern Ireland? Perhaps Mike has a holiday home in one of them and doesn't want it burned to the ground by irate Celts (only joking, Mike!). Why else duck the point that it is only a cost to English taxpayers? Not a good start though...

Mike then goes on to outline the history of government redistribution from England to the other states, noting that there was little in the way of formal, democratically determined policy or even scrutiny. He then points out that the Barnett Formula applies to education, health and social services, as well as law and order (although Wales is included with England for funding purposes in the latter area) whilst excluding most areas of public spending that are of a national nature, plus social security and pensions.

What I object to most of all is the sense that he acknowledges that there might be a case for higher spending in two out of three states,

"whereas Northern Ireland’s position is arguably justified on the basis of peace and reconstruction"

"they (Welsh politicians) point to the high cost of running public services in a territory that suffers problems of urban poverty combined with the challenges of rural inaccessibility"

and then simply ignores this, despite the fact that they might account for half of the £200 billion. All that is left is Scotland. If the arguments put by Welsh politicians are accepted, and Mike has, remember, not seen fit to challenge them, then surely the argument is similar for Scotland, with its significant tracts of urban poverty (and I've been to Glasgow East) and comparatively vast rural hinterland. As Scotland's population is that much larger than that of Wales, the comparative fiscal transfers per head are not vastly different.

So, I would suggest that if you accept the arguments made by Welsh and Northern Irish politicians, as Mike has, his £200 billion becomes a much more anaemic figure.

It's a real pity, because we desperately need more transparency in terms of fiscal transfers betwen the states and regions. It doesn't help when you quote vast figures in your defence, wilfully misrepresent them and then resort to an attack on Scottish Nationalists.

This is claimed to be a definitive report on the Barnett Formula. I would suggest that it is a partisan attack on the general concept of government spending, on politicians, and on the idea that choice only applies if you live somewhere convenient, because you could argue that opposition to additional funding support for rural parts of our nation will make such places economically unviable.

Mike, nice try, but back to the drawing board, I'm afraid...