A TOP expert on devolution has issued a grave warning that the Tory government’s damaging tax cuts threaten the future of devolution and Scotland’s NHS.
Alan Trench, a leading academic with a focus on devolution in the UK and overseas, shared a comment from top economist Charlie Bean – who fears that if the Government doesn’t reverse its economic plans, public spending may have to be cut so much that it leads to the end of the NHS.
Trench, who has worked in the devolution space for more than 20 years and also served as a policy adviser, stressed that ruining the NHS would be a “feature not a bug” for this Conservative government.
I might add, with my old devolution hat on: public spending cuts on that scale will tear the financial fabric of a devolved Union to shreds. It's based on allocating funds roughly proportionally to spending in England. No spending in England, no funding for devolved govts.
— Alan Trench (@devomatters) September 27, 2022
He went on: “Public spending cuts on that scale will tear the financial fabric of a devolved Union to shreds.
“It's based on allocating funds roughly proportionally to spending in England. No spending in England, no funding for devolved govts.”
This is because funding for Scotland is calculated through the Barnett formula – a convention which sees the devolved nations provided with a proportional (based on population) percentage of the UK Government’s budgets for England.
The money is given to the parliaments in a block grant, so devolved governments don’t necessarily have to cut healthcare funding if the UK Government decides to do so. However, Scotland, Wales and Northern Ireland may need to replace health funding with cash meant to go to other public services in that scenario.
Trench argued that this couldn’t be solved by giving the devolved parliaments more powers over taxation or borrowing.
“The British free-market right don't understand or subscribe to US-style fiscal devolution,” he said. “They won't support handing over tax powers to devolved govts to make up for slashing the block grant. They want to control public spending from the centre then minimise it.”
Despite extraordinary interventions from the IMF and Bank of England on Wednesday, reports indicate that Prime Minister Liz Truss has no intention of reversing Kwasi Kwarteng’s mini-budget policy announcements – leaving the public service cuts on the table.
As she ignored demands for parliament to be recalled despite panic setting in, a Number 10 spokesperson told The Guardian’s Pippa Crerar: "The PM and the Chancellor are working on the supply side reforms needed to grow the economy which will be announced in the coming weeks".
SNP MSP Jim Fairlie slammed the Prime Minister’s approach. “The Tories pose a serious threat to the future of our Scottish Parliament and Scotland’s public services and the only way to firmly protect it is by becoming an independent country,” he said.
“Bit by bit the Tories are ripping apart devolution through the Internal Market Bill, the Levelling-Up Fund and now we face the real prospect of severe cuts to public services which will have a devastating impact on the future of devolution in Scotland.
“As the Tories tank the economy and the pound nose-dives, no public service is safe. By rejecting amendments to their Trade Bill even our NHS can be opened up to US-style health providers and there is nothing we could do about it. Meanwhile, so-called Scottish Labour continue to sit on their hands and say nothing while the Tories carry out their systematic destruction of devolution.”
In recent years, the Tory government has blocked legislation aiming to protect the NHS from future trade deals and require consent from the devolved parliaments for their health services to be featured in future deals.
And just last week it was warned that Westminster’s new Retained EU Law (Reform and Revocation) Bill could “ride roughshod” through the devolution settlement.
The bill aims to repeal all EU regulations remaining in the UK, which would include protections on safe working hours, parental leave and standards on baby food.
It also gives Holyrood just a year to protect 47 years' worth of EU regulations, and allows UK ministers to act in devolved areas in direct contradiction of the Sewel Convention.
In a letter to Business Secretary Jacob Rees-Mogg, Scotland's Constitution Secretary Angus Robertson said the bill would result in a “race to the bottom”.
