This is no time to short-change Wales

THE UK Government has been urged to “bite the bullet” and scrap the much-derided Barnett formula which is still used to allocate Treasury cash to the devolved governments.

The formula is a classic example of a back-of-the-envelope solution that should have been scrumpled up years ago.

Former Labour Chief Secretary to the Treasury Joel Barnett, who devised it in 1978, said in 2014 that it was a “great embarrassment” to have his name “attached to so unfair a system”.

Its critics say it is overly generous to the Scots while it has regularly underfunded Wales.

The House of Lords EU committee has made a new push for the formula to be scrapped as Brexit looms, stating: “This will be a complex task, but the prospect of Brexit means that reform of the Barnett formula can be delayed no longer.”

Alas, the peers may well find that ministers will decide reform can, in fact, be delayed a lot longer.

The final hour “vow” made by David Cameron, Ed Miliband and Nick Clegg to the Scots in the 2014 independence referendum campaign gave the impression that the formula would stay in place.

It is widely seen as the price the rest of the UK pays to keep the Scots in the union.

That was a political decision – just as Theresa May signed-off on a £1bn deal with Northern Ireland’s DUP to keep her Government in power.

Such deals are part and parcel of democracy. Communities elect representatives who use whatever power they can marshall to deliver benefits for their constituents.

However, it grates with many people that spending per head was recently £13,054 in Scotland but only £12,531 in Wales, even though we have some of the most deprived communities in the UK and atrocious levels of low earnings.

The vow to keep the Barnett formula in Scotland should not prevent the institution of a needsbased system for Wales. At a time when austerity policies continue in many branches of the public sector we cannot afford to be penalised unfairly.

The introduction of a funding “floor” in an effort to protect funding in Wales was an acknowledgement of the weaknesses of the formula. However, this is not a long-term solution.

A equitable way of dividing Treasury cash between the different nations and regions of the UK should not be too great a challenge for the brightest minds across Government.

In the months ahead the UK Government will have to describe in greater detail how it will replace the regional funding that up until now has come from the EU. We should be entering an era of political maturity in the UK when the allocation of funds is a wholly transparent process and communities in need get the help they need to match the prosperity which is taken for granted elsewhere.

The peers are in no doubt about the enormity of the potential impact of Brexit on the Welsh economy. This is no time to be short-changed.