§ 6. Mrs. Teresa Gorman (Billericay)
What plans he has for a needs assessment to inform decisions on the size of the Scottish block made available to the Scottish Executive. 
§ The Minister for Home Affairs and Devolution, Scottish Office (Mr. Henry McLeish)
The Scottish Parliament's assigned budget for the next three years has been determined as part of the comprehensive spending review. From 1 July 1999, any change to the funding arrangements for the Parliament, including any proposal for a study of Scotland's relative needs, would be the subject of full consultation between the Scottish Executive and the UK Government.
§ Mrs. Gorman
Will the Minister confirm that the last needs assessment for Scotland was conducted in 1977, under the last Labour Government, since when per capita income in Scotland soared under the Conservative Administration; and that per capita income in Scotland is now equal to that in England? Does he agree that, when the next needs assessment is considered, there will no longer be any excuse for English taxpayers having to subsidise Scotland to the tune of £1,000 for every man, woman and child in Scotland? There are needy areas in the south-west, Cornwall and the north-east, parts of London that currently languish under Labour management, and even parts of my constituency in Basildon where we could do with that money and where, I put it to him, the money could legitimately be directed.
§ Mr. McLeish
It is a pity that the House continues to hear such tired old arguments about devolution and the 170 state of public finances in the United Kingdom. We have a settled system that is fair and provides stable finances throughout the whole of the United Kingdom. We believe that there is no need for a needs assessment, but, as I said, if that happens in future, there will be close consultation between the UK Government and the new Scottish Executive.
That said, comments such as the hon. Lady's are about attacking devolution. I should have hoped that the issue would be put to rest by now, because all parties in the House now support that proposition. Let me tell the House what is important in Scotland: £4 billion of new money is being spent over the next three years, of which £1.8 billion will be spent on health and £1.3 billion on education. That is what my constituents want and I am sure that it is what the House wants as well.
§ Mr. Ernie Ross (Dundee, West)
Does my hon. Friend agree that it seems passingly strange that, on the one hand, the Tories are saying that we are spending too much and, on the other hand, the other right-wing party in Scotland, the Scottish National party, is saying that we are spending too little? Does my hon. Friend believe that the commitment given in the devolution White Paper that the Barnett formula will not be changed without a full assessment of Scotland's relative needs, together with the comprehensive spending review—which gives £1.8 billion extra for health and £1.3 billion extra for education—are the right policies to follow?
§ Mr. McLeish
I agree entirely with my hon. Friend. This is a stable settlement which provides something that is fair to the United Kingdom and to Scotland. My hon. Friend has highlighted the fact that, on the one hand, the SNP argues that the Barnett formula undermines the Scottish settlement, while, on the other hand, the Conservatives argue that Scotland is getting too much. They are both simply wrong. It is a fair settlement which should be supported.
§ Mr. John Swinney (North Tayside)
Before a needs assessment is carried out, is the Minister at all concerned about the fact that education and health spending in Scotland is increasing at a slower rate than in England and Wales as a result of the comprehensive spending review? As a consequence, does he not realise that the statement that he has just made and the comments by the hon. Member for Dundee, West (Mr. Ross) are ludicrous because they reveal no understanding of the real impact of the Barnett formula on public finances in Scotland?
§ Mr. McLeish
It is no surprise or secret that spending levels are 20 per cent. higher per capita in Scotland. What is the SNP arguing? Is it arguing that Scotland is getting too much from Barnett and that the percentage is too high, or that it will spend more money and offer Scots a new future? The SNP cannot get away with that because it simply does not understand the finances: it is living in an economics fantasy world. Scots clearly want investment in real projects, and £4 billion in new money has been provided. The SNP cannot compete with that and the Tories want to undermine it, but ours is the correct way forward.