Government spending gap between England and Scotland widens - Telegraph.co.uk

David Mowat, the Tory MP, said: "It is right that the Scottish government can set its own priorities and if it wants to prioritise free prescriptions, for example, that is fine. But it is not right that they end up with an extra £1,600 per person to pay for it.

"This is quite wrong and will rightly cause indignation in England. Many MPs are having to defend deeply unpopular cuts. We do so on the basis that there is no alternative and that the deficit must be brought down.

"This argument looks a bit limp when the Coalition is able to fritter away billions of pounds to appease vested interests north of the border. We should have a funding formula that is based on need."

Total public spending per head in Scotland last year was £10,212, compared to £8,588 in England, figures in the Treasury's annual Public Expenditure Statistical Analyses show.

The gap widened by 15.2 per cent in a year - from £1,409 to £1,624.

In the South East of England, which is responsible for a large share of tax revenues, public spending was just £7,533 per head. Although poorer than Scotland, Wales received £9,829 per person.

The cause of the funding gap between the two countries lies in the Barmett Formula, introduced under Labour more than 30 years ago.

The system is devised to ensure that changes in public expenditure in one geographical area lead to alterations elsewhere proportionate to population rather than need.

It was originally only created as a stop-gap measures to run for a year, but despite the growing discrepancy in spending, successive governments have refused to overhaul the system.

It means Scots receive 10 per cent of the money handed out by Whitehall, despite having little more than eight per cent of the population. Income tax would have to rise by 11p in the pound in Scotland if it were to fund itself.

Lord Barnett, the former Treasury chief secretary who created the formula, has warned that the system is "grossly unfair" to England and is planning to table amendments to the Scotland Bill, which would replace it.

Tory MP Gordon Henderson added: "It is simply wrong that English taxpayers are being asked to help subsidise for people living in Scotland a range of services not available in England, including free prescriptions, free hospital parking, free accommodation in care homes and free university tuition fees.

"Something has to be done before the justifiable resentment felt by many people about the unfair subsidy English taxpayers are expected to contribute towards superior services north of the border, manifests itself in an anti-Scots backlash."