Supplementary memorandum submitted by
the Scotland Office (MISC 3)
When Scotland Office Ministers appeared before
the Committee on 7 November it was agreed that a number of matters
needed to be disposed of by means of a supplementary memorandum
which I enclose. This additional information takes the form of
notes on:—
(a) the financial arrangements for funding devolution
in Scotland;
(b) the operation details of the work of the
Legal Secretariat to the Advocate General and the office of the
Solicitor to the Advocate General; and
(c) the complete list of Sewel Motions.
My apologies for the delay.
E B Miller OBE
Parliamentary Liaison Officer
6 February 2002
Financial Arrangements
ROLE OF
THE SECRETARY
OF STATE
1. The arrangements for funding devolution
in Scotland were a key part of the constitutional settlement made
in 1999. It is important that we have a practical and fair system
for setting overall expenditure on devolved services in Scotland
and a system which leaves the Scottish Parliament with full discretion
to decide its delegated spending plans within the overall public
expenditure limits set. That the Scottish Executive has full discretion
to allocate resources to meet its priorities is a key aspect of
the devolved system.
2. The arrangements for the financial relationship
between the UK Government and the devolved administrations are
set out in "Funding the Scottish Parliament, National Assembly
for Wales and Northern Ireland Assembly: A Statement of Funding
Policy", which is published by the Treasury. The Statement
is to a large extent a formalisation of the long-standing conventions
that have guided funding in Scotland (together with Wales and
Northern Ireland) prior to devolution. It sets out the key principles
for allocating expenditure within the UK and describes in detail
the operation of the Barnett formula.
3. The first edition of the Statement was
published in March 1999, in the run-up to devolution. It was reviewed
in the course of the 2000 Spending Review and a revised edition
was published in July 2000. The changes between the first and
second editions were not substantial. The Statement is published
by the Treasury with the agreement of the 3 Secretaries of State
and following consultation with the 3 devolved administrations.
4. The Secretary of State is consulted by
the Treasury about the operation of the funding arrangements and
about any proposed changes. Scotland Office officials work with
the Treasury and the Scottish Executive to ensure that the arrangements
are being implemented correctly and that Scotland receives its
fair share of spending allocations.
5. Once the overall provision is determined,
the UK Parliament votes the necessary provision to the Secretary
of State. She, in turn, makes grants to the devolved administration,
as set out in the Scotland Act 1998. The Secretary of State accounts
to the UK Parliament for the provision of the grant but the allocation
of money to devolved services is a matter for the Scottish Parliament.
STATEMENT OF
FUNDING POLICY
6. The Statement of Funding Policy which
was published in July 2000 is the current, up-to-date version.
It will be reviewed as part of the 2002 Spending Review to make
sure that it takes account of the latest population figures, any
changes in the comparability factors for Whitehall departments'
spending programmes, and any developments in Resource Accounting
and Budgeting.
SPENDING REVIEW
2000
7. The Barnett formula determines changes
to expenditure within the assigned budgets of the devolved administrations;
it does not determine the total allocation. The formula delivers
one figure that is the increase in the total of the assigned budget
of the Scottish Executive. These resources are unhypothecated
and it is for the Scottish Executive to allocate them to meet
Scottish priorities. There are 3 factors that determine changes
to the assigned budget. These are:—
1. the quantity of change in planned spending
in UK Government departments;
2. the extent to which the relevant UK departmental
programme is comparable with the services carried out by the devolved
administration; and
3. Scotland's population as a proportion
of England or England and Wales, as appropriate.
Using these 3 factors, net changes to the assigned
budget are derived by adding, for each UK department:
Change to the UK Government department's programme
× Comparability percentage × Appropriate population
proportion
8. Details of the comparable sub-programmes
are given at Annex C of the Statement of Funding Policy. These
are used to calculate the overall comparability percentages for
each department. The population proportions are assessed using
mid-year estimates provided by the Office for National Statistics.
At the time of the 2000 Spending Review (SR 2000), the estimate
of Scotland's population as a proportion of England's was 10.34
per cent; as a proportion of England and Wales it was 9.77 per
cent.
9. In the July 2000 Spending Review, application
of the Barnett formula, produced the following increases in the
Departmental Expenditure Limit baseline.
| | |
| | | |
| | Scotland
| | | £ million
| |
| | |
| | | |
| | |
| | | |
| 1999-2000 | 2000-01
| SR2000 | Provision
| following | SR2000
|
| Planned | Planned
| Baseline for | |
| |
| Expenditure | Expenditure
| 2001-02 | 2001-02
| 2002-03 | 2003-04 |
| | |
| | | |
| | |
| | | |
| | |
| | | |
| Total DEL | 13,670 | 15,050
| 15,430 | 16,230 | 17,370
| 18,430 |
| Increase over | |
| | | |
|
| Baseline | |
| | +800 | +1,940
| +3,000 |
| Increase over 2000-01 | |
| | |
| |
| Planned | | |
| | |
|
| Expenditure | |
| | +1,180 | +2,320
| +3,380 |
| | |
| | | |
Treasury calculated the increase in the Scotland DEL on
the basis of the following changes to Government Departments:
| | SR 2000 Outcome
| |
| | (Resource + Capital) 1
| |
| Department | 2001-02
| 2002-03 | 2003-04
|
| £m | £m
| £m |
| Programme Additions |
| | |
| DfEE | 1,600 | 3,770
| 5,960 |
| Health | 2,760 | 7,740
| 12,310 |
| DETR — Transport | 1,000
| 2,450 | 4,100 |
| DETR — other | 260 |
1,130 | 1,820 |
| DETR — LG | 650 | 3,090
| 5,710 |
| Home Office2 | 1,560
| 2,240 | 2,580 |
| Legal Depts2 | 310
| 370 | 390 |
| Trade and Industry | 1,020 |
710 | 650 |
| Agriculture | 210 | 300
| 330 |
| Forestry | 10 | 10
| 10 |
| DCMS | 80 | 130
| 200 |
| Chancellor's Departments | 350
| 550 | 580 |
| Cabinet Office | 120 | 120
| 190 |
The population proportions and comparability factors are
published in the Statement of Funding Policy.
Notes:
1. Figures rounded to nearest £10 million.
2. England and Wales population proportions apply.
10. We should be clear that the manner in which Treasury
determines the grant to the Secretary of State for Scotland and
subsequently to the Scottish Executive is unrelated to the Executive's
decisions to allocate resources to meet Scotland's priorities.
The allocation of money from the assigned budget to devolved services
is a matter for the Scottish Parliament.
ANNUALLY MANAGED
EXPENDITURE
11. Section 12 of the Statement of Funding Policy provides
details of the public expenditure regime for the Scottish Executive
and shows those areas covered by Annually Managed Expenditure
(AME). The present AME expenditure plans for the period 1999-2000
to 2003-04, are as follows:—
ANNUALLY MANAGED EXPENDITURE (AME)
£000
1999-2000 2000-01 2001-02 2002-03 2003-04
CAP 334,775 340,709 373,000 349,471 381,710
Housing Support Grant 10,649 9,054 10,000 9,962 9,962
NHS and Teachers' Pensions 224,560 286,524 272,000 272,000 323,000
Other AME 841,395 979,741 1,089,600 1,130,940 1,202,145
Local Authority Self-Financed Expenditure 1,441,000 1,473,000 1,560,000 1,570,000 1,590,000
Scottish Non-Domestic Rates 1,440,522 1,510,992 1,544,817 1,569,817 1,589,817
Scottish Variable Rate of Income Tax 0 0 0 0 0
Total 4,292,901 4,600,020 4,849,417 4,902,190 5,096,634
Other Expenditure outside DEL £000
Police Loan Charges 13,346 13,571 13,571 13,571 13,571
Note:
The Scottish Executive is currently preparing Budget Documents
for 2002-03 and so figures for 2002-03 and 2003-04 are provisional.
RESOURCE BUDGETING
12. The introduction of resource accounting and budgeting
will not entail any fundamental change in the operation of the
Barnett formula. Paragraph 5 of the summary to the Statement of
Funding Policy says:
"The introduction of resource budgeting means that this
approach is applied to resources and capital budgets, but the
principles remain the same."
13. In other words, the Barnett formula was applied in
SR 2000 to changes in public expenditure plans, even though these
changes now apply to plans that were prepared in resource terms
rather than the previous cash basis. There will, of course, be
some transitional changes to take account of the shift from cash
to resource based financial plans and budgets referred to in the
Statement of Funding Policy. The Departmental Report will continue
to keep the Committee informed about technical accounting changes.
Scotland Office
February 2002
THE LEGAL SECRETARIAT TO THE ADVOCATE GENERAL AND THE
OFFICE OF THE SOLICITOR TO THE ADVOCATE GENERAL
The Legal Secretariat to the Advocate General comprises 3
qualified lawyers and support staff including the Legal Secretary
who is a member of the Senior Civil Service. The Secretariat assists
the Advocate General in the preparation of formal legal advice
to the Government, in briefing for Cabinet Committees and Parliamentary
business, in handling official correspondence and other Ministerial
activities.
The Office of the Solicitor to the Advocate General comprises
16 qualified lawyers, including the Solicitor and 2 other members
of the Senior Civil Service. There are also support staff. The
Office has an extensive public law litigation practice before
the Court of Session, including in particular acting for the Home
Office in immigration matters, but also, for example, acting for
the Department for Work and Pensions in social security cases,
the Department of Trade and Industry, the Department for Environment,
Food and Rural Affairs and the Office of Fair Trading as well
as a wide range of other United Kingdom Government Department
and agencies. It represents the Department for Work and Pensions
at hearings in Scotland before the Social Security Commissioners.
Where devolution issues arise under the Scotland Act, the office
also acts for the Advocate General, who will appear personally
or give instructions about the case.
Apart from litigation, the Office instructs Scottish provisions
in Government Bills introduced into the United Kingdom Parliament
and prepares subordinate legislation on reserved matters relating
to Scotland. It advises the Advocate General and the United Kingdom
Departments on matters relating to Bills introduced into the Scottish
Parliament and on Scottish subordinate legislation as well as
giving legal advice on Scots law to most United Kingdom Government
Departments and agencies.
The Solicitor's Office, and the Legal Secretariat form part
of the Government Legal Service for Scotland, which includes also
the Office of the Solicitor to the Scottish Executive and the
Legal Secretariat to the Lord Advocate, as well as supplying legal
staff to a number of other organisations including the Scottish
Law Commission and the Scottish Parliament. The Government Legal
Service for Scotland was established in 1999 to ensure that a
supply of suitably experienced lawyers would continue to be available
in Scotland to both the United Kingdom Government and the Scottish
Executive and recruitment, training and career development of
staff is on a service-wide basis. As at 13 November 2001, the
Service as a whole comprised some 126 legally qualified staff,
by far the largest component being the Office of the Solicitor
to the Scottish Executive which on 13 November had 82 legally
qualified staff.
Table of Sewel Motions
| Bill | Sewel Motion Approved
| Royal Assent |
| | |
| Food Standards* | 23 June 1999
| 11 Nov 1999 |
| Financial Services and Markets* | 23 June 1999
| 14 Jun 2000 |
| Electronic Communications* | 23 June 1999
| 25 May 2000 |
| Limited Liability Partnerships* | 23 June 1999
| 20 Jul 2000 |
| Sea Fishing Grants (Charges) | 8 December 1999
| 28 Jul 2000 |
| Representation of the People | 13 January 2000
| 9 Mar 2000 |
| Sexual Offences (Amdt) | 19 January 2000
| 30 Nov 2000 |
| Race Relations (Amdt) | 25 May 2000
| 30 Nov 2000 |
| Care Standards | 22 June 2000
| 20 Jul 2000 |
| Insolvency | 1 June 2000 |
30 Nov 2000 |
| Political Parties, Elections and Referendums
| 9 March 2000 | 30 Nov 2000
|
| Political Parties, Elections and Referendums
| 6 July 2000 | 30 Nov 2000 |
| Regulation of Investigatory Powers | 6 April 2000
| 28 Jul 2000 |
| Government Resources & Accounts | 6 July 2000
| 28 Jul 2000 |
| Criminal Justice and Courts Service | 5 October 2000
| 30 Nov 2000 |
| Health and Social Care Modernisation | 17 January 2001
| |
| Tobacco Advertising and Promotion | 17 January 2001
| |
| International Criminal Court | 18 January 2001
| |
| Outworking | 31 January 2001
| |
| Criminal Justice and Police | 7 February 2001
| |
| International Development | 8 March 2001
| |
| Culture and Recreation | 8 March 2001
| |
| Armed Forces | 29 March 2001
| 11 May 2001 |
| Adoption and Children | 4 April 2001
| |
| Adoption and Children | 24 October 2001
| |
| Proceeds of Crime | 24 October 2001
| |
| Anti-Terrorism | 15 November 2001
| |
| NHS Reform and Health Care Profession | 22 November 2001
| |
| Adoption and Children Bill | 30 January 2002
| |
| Police Reform Bill | 30 January 2002
| |
* Approval of Westminster legislation by the Scottish Parliament
before it assumed its full powers on 1 July 1999.
Scotland Office
6 February 2002
|
