The main story in this morning’s Telegraph is the news that residents of Scotland can expect free prescriptions within four years although residents of England will still have to pay.  Conservative MP Ben Wallace, a Shadow Scotland Minister, said that this was "another example of how devolution is all at one end at the
moment."  Labour had not delivered fairness, he said.

Matthew Elliott of The TaxPayers’ Alliance got to the heart of the issue in his comment to The Telegraph: "Either Scotland should be made to raise the money it spends or these measures should be rolled out nationwide."  The fact is, as The Telegraph points out, Scotland does not raise the extra money it needs to pay for the extra public services that Scottish voters receive.  The average resident of Scotland receives nearly £1,500pa more per head than the average resident of England from the UK taxpayer.  This is because of the Barnett formula devised in the 1970s which, among other things, takes account of Scotland’s special characteristics – including its geographical expanse and rural character which raises the costs of providing public services.

The Conservatives need to proceed sensitively in addressing this issue.  Expressions used by The Telegraph – like "The public services ”apartheid" between England and Scotland" – should be avoided.  We are a Unionist party and we must not take risks with the Union.  We must be pro-Scottish and that is why the party in London should revisit plans to give the Scottish party more autonomy over its affairs.  But we cannot allow a sense of English grievance to grow.  David Cameron has already said that he supports English Votes for English Laws.  It is now time to modernise the Barnett formula.  A subsidy may still be appropriate but it has become too large.  London, in particular, with more than its fair share of very poor communities, should be able to retain more of the tax that its citizens pay.

In a leader, The Telegraph makes the point that many Scots do not even feel the benefits from the England to Scotland subsidy.  The money is eaten by the quangoes and other bloated public sector institutions that have grown fat under Labour.  A reduction in the Barnett formula may be the shock that the Scottish public sector needs to begin reforms that have been delayed for far too long.

Labour will, of course, accuse our party of playing politics with the Union.  We should hit back hard at those suggestions.  Recent evidence shows that Labour has been using UK taxpayers’ money to disproportionately benefit its own voters in Wales, Scotland and northern England.  It has been buying votes.  We should consistently use the word used by Ben Wallace: fairness.  More prosperous parts of the UK should be happy to help less prosperous parts but the extent of subsidy has simply become too great.

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