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FUNDING THE SCOTTISH PARLIAMENT, NATIONAL ASSEMBLY FOR WALES AND THE
NORTHERN IRELAND ASSEMBLY
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SUMMARY
The arrangements set out in this Statement represent ,in most cases,the
continuation o long-standing conventions that have guided funding
or Scotland,Wales and Northern Ireland prior to devolution and are
consistent with the Devolution White Papers and the Devolution Acts.A
short summary guide is set out below.
Government funding for the devolved administrations ’budgets is normally
determined within spending reviews alongside departments of the United
Kingdom and in accordance with the policies set out in this Statement.The
United Kingdom Parliament votes the necessary provision to the Secretaries
of State;they make payments to the devolved administrations.
Each devolved administration ’s budget is not unded exclusively by
grant rom the United Kingdom Parliament.Further elements of the budget
are covered by funding from locally inanced expenditure (including
non domestic rates and the Scottish Variable Rate of Income Tax if
a decision is taken to use the tax varying power),and through borrowing
by local authorities of Scotland,Wales and Northern Ireland and other
public bodies to und their capital spending.As for United Kingdom
Government Departments,European Structural Funds expenditure alls
within the devolved administrations ’Departmental Expenditure Limits.
The block grants (or assigned budgets )are contained within the devolved
administrations ’Departmental Expenditure Limits.Changes to these
budgets are generally determined by the Barnett formula.This largely
removes the need to negotiate directly the allocation between Treasury
Ministers,Secretaries of State and Ministers o the devolved administrations.
Under the ormula,Scotland,Wales and Northern Ireland receive a population
based proportion of changes in planned spending on comparable United
Kingdom Government services in England.Changes in each devolved administration
’s spending allocation is determined by the quantity of the change
in planned spending in departments of the United Kingdom Government,the
extent to which the relevant United Kingdom programme is comparable
with the services carried out by each devolved administration and
each country ’s population proportion.The introduction of resource
budgeting means that this approach is applied to resource and capital
budgets but the principles remain the same.
The allocation of public expenditure between the services under the
control of the devolved administrations is for the devolved administrations
to determine.Consistent with the arrangements for departments of the
United Kingdom Government,the devolved administrations will normally
be expected to accommodate additional pressures on their budgets,with
access to the Reserve being considered in exceptional circumstances
only. Un oreseen pressures should be catered for by offsetting savings
and re-allocating priorities.
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