Thursday 18 March 2004

Creating money out of thin air

So, "Scotland" has hit the jackpot:
SCOTLAND is to get an unexpected £600 million Budget boost thanks to Gordon Brown’s decision to increase spending on education and science in England and Wales.
Isn't that wonderful? Another £600 million goes into the Scottish economy.

Not quite. A bit further into this rather misleading article there's this little observation:

As a result of the Barnett Formula, the Scottish Executive will have at least £183m extra in 2006-7 and a further £407m in 2007-8.
Aha! It's not "Scotland" that gets the £600 million, but the Scottish Executive. Not quite the same thing. Now I know that some of our friends down south think that all of Scotland's public expenditure is financed by England, but there are some of us up here who actually pay taxes. According to some previously issued government figures we do in fact pay our full way in the union. So this "£600 million Budget boost" is merely (sic) another transfer from the taxpayer to the taxconsumer. Hardly newsworthy, is it?