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Cameron: no change to Barnett

DAVID CAMERON has ruled out making changes to the controversial Barnett formula, following SNP claims Scotland stands to lose £4 billion.

The move comes after weeks of pressure over the calculation, which gives Scotland £1500 more in public spending per head than England.

The Coalition announced that there were no plans to review the formula before the next general election.

In a letter to First Minister Alex Salmond, the Prime Minister said that reform was not "on the horizon". But he also admitted that he could not tie the hands of future UK Governments.

The SNP has claimed that a 'No' vote in next year's independence referendum would allow the Coalition to scrap the formula.

The calculation has long proved contentious amid claims from some Tories that it is overly generous to Scotland.

Last year average spending per head in Scotland totalled £10,152, compared with £8788 across the UK, £8529 in England and £9709 in Wales. The highest spend was in Northern Ireland where the figure was £10,876.

The calculation was given a stay of execution in 2010 when ministers announced they would look at it only once the UK's finances were "stable".

Yesterday during Scottish Questions in the Commons, Lib Dem Scottish Secretary Alistair Carmichael went further.

There would be no review "in this parliament", he told MPs.

Mr Cameron, in his letter to Mr Salmond, described calls for guarantees "in perpetuity about the future ... quite astonishing".

"I can no more bind future UK Governments than you can bind future Scottish Governments," he added. "What I can say is that reform of the Barnett formula is not on the horizon.

"Indeed the only immediate threat to Scotland's funding is a vote for independence."

Coalition sources added that the Barnett formula was a reason to stay in the UK not leave it, as it helped share resources.

Last night the SNP said the comments showed that the funding system could be changed after 2015. Deputy First Minister Nicola Sturgeon accused Mr Cameron of letting the "cat out of the bag".

She said: "It is what is just over the horizon that people should be concerned about, and the PM is on record as saying Barnett is 'coming to the end of its life'.

"The Westminster parties are determined to slash Scotland's cash in the event of a No vote, by up to £4 billion a year and only a Yes vote will prevent that.

"Once again David Cameron is entering the discussion on Scotland's future without having the courage to debate the issues openly. If he is so sure of his arguments he should now agree to a head-to-head debate with the First Minister."

Scottish Liberal Democrat leader Willie Rennie accused the SNP of resorting to scare tactics.

"This letter makes clear that it is Alex Salmond and Alex Salmond alone who is trying to put about the heebie-jeebies over the future of Scotland's funding formula within the UK."

Barnett allocates money on population share rather than need. It was created as a stop-gap formula by Labour politician Joel, now Lord, Barnett, in the 1970s when he worked in the Treasury.

He has since argued that it should be scrapped and replaced with needs-based funding.

Last month the Local Government Association, which represents English and Welsh councils, said that England's communities were being "shortchanged" to the tune of £4.1billion a year.

The Westminster All-Party Parliamentary Taxation Group has also called for Barnett's replacement.

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