Scots win first round in cash battle

‘Respect agenda’ seems to be working well for Holyrood but is not much in evidence in Cardiff Bay

While Welsh Finance Minister Jane Hutt is locked in negotiations with the Chief Secretary to the Treasury Danny Alexander today, about when and where to start cutting her budget, Scotland’s First Minister Alex Salmond has won the first round of the cash battle

Following yesterday’s Joint Ministerial Committee in Downing Street it was announced that Scotland has secured an additional £182 million in funding from the UK government via the Scottish fossil fuel levy. This was flagged up in the coalition agreement between the Conservatives and Liberal Democrats, significantly placed in the political and constitutional change of the document, as I reported at the time.

What it demonstrates is that, in sharp contrast with the Labour Plaid Administration in Cardiff Bay, Alex Salmond’s SNP government in Holyrood is developing an almost cordial relationship with the new Westminster administration. Certainly the photographs of smiling Scottish faces that emerged from yesterday’s Downing Street meeting tell their own story.

After years of conflict with Labour Ministers, Scotland is set to get a pot of money from the fossil fuel levy that can be invested in renewable energy projects. While in government Labour consistently refused to hand over the cash despite claims that it was Scotland’s money.

In a further boost, First Minister Alex Salmond last night claimed that he was also confident about securing £190 million for Scotland, calculated as a share of the spending on the London Olympics. If that is so why isn’t First Minister Carwyn Jones and Deputy First Minister Ieuan Wyn Jones publicly on the case on behalf of Wales?

The Joint Ministerial Committee, about which I judge we’ll hear a lot about in the coming years, provides an opportunity for UK and devolved administration Ministers to discuss issues of common concern. Yesterday Alex Salmond called for a new statement of financial policy and more flexibility in capital allocations from the UK government covering the three-year period of the upcoming spending review, as well as greater spending powers. He said the measures would help Scotland’s economic recovery after the recession.

One hopes that Welsh Ministers are making a similar pitch, which is presumably what is on Jane Hutt’s ‘to do’ list at her meeting today. 

She should also be endorsing Salmond’s insistence that Wales will fight the new coalition government on slashing public spending and the “speed and depth” of the proposed cuts. Obviously, this is territory that is being prepared in advance of next year’s Assembly election.

David Cameron met both Alex Salmond and Carwyn Jones shortly after becoming Prime Minister and spoke about a  “respect agenda” between his coalition government and those in the Cardiff, Edinburgh and Belfast. Yesterday Salmond said the “respect agenda will always be judged by actions not words” but added it had got off to a good start.” It is better to have a respect agenda instead of a disrespect agenda,” he said, alluding to the less co-operative positions often taken by the previous government.  He added: “I look forward to the respect dividend bringing benefits of EU meetings across subjects such as fisheries, agriculture, justice, energy, culture and the great many other areas where Scotland has real expertise and valuable contributions to make.”

The tone is pretty upbeat. It contrasts sharply with the atmosphere between Carwyn Jones and David Cameron, which insiders say has been “pretty cold” so far.

John Osmond is Director of the IWA.

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