Northern Ireland funding to be cut if Boris Johnson becomes UK Prime Minister, warns economist
A leading economist has warned that people in Northern Ireland here may have to "tighten their belts till it hurts" if Boris Johnson becomes Prime Minister and tinkers with the Barnett Formula - the mechanism by which public money is allocated to devolved regions of the UK.
The warning from John Simpson came as fears grew in Scotland that Mr Johnson could ditch the Barnett mechanism if he replaces Theresa May later this month.
Both Northern Ireland and Scotland benefit disproportionately by billions of pounds thanks to the complex financial formula, Mr Simpson said.
"Northern Ireland spends just over £3bn (€3.34bn) per year more than it would if it were treated the same as people in England," he said.
The question arises: how come Northern Ireland gets £3bn more than we would if we were English, yet we don't build enough houses, we don't build enough infrastructure, and we can't run our health service? Economist John Simpson
In 2014, just a day after the Scottish independence referendum, Mr Johnson indicated that he would be in favour of a redesigned funding model.
The Conservative MP made the comments after the late Labour peer Joel Barnett, who devised the formula, said that it was unfair.
"We can't just go on with a system that even Joel Barnett himself thinks is outdated," Mr Johnson said at the time.
"There's a good way of honouring this odd promise. Ask Lord Barnett, who has disassociated himself from this formula, to get on with redesigning it.
"He said, Lord Barnett said himself, it was crazy and outdated to continue to funnel money in this way.
"If he thinks so then I'm sure everybody else south of the border (with Scotland) thinks so. It's my solution for honouring what is a slightly reckless promise."
In 2017/18 public spending per person in the UK as a whole was £9,350.
But in Northern Ireland the figure was £11,190 - 20pc above the UK average.
In Scotland the figure was £10,881 (16pc above the UK average), while in Wales the figure per person totalled £10,397 (11pc above the UK average).
In England it was £9,080 - lower than the UK average.
Mr Simpson said the funding level here had sparked concerns in Whitehall.
He added: "The question arises: how come Northern Ireland gets £3bn more than we would if we were English, yet we don't build enough houses, we don't build enough infrastructure, and we can't run our health service?
"There's trouble afoot.
"If the Barnett Formula was scrapped and we simply allocated money on the basis of our population pro rata to what would be spent on the same number of people in England, then we'd have Stormont being told that it would have to tighten its belt so much it would hurt - it really would hurt."
The Scots also benefit from the Barnett Formula, and undoubtedly would also be worried by any Whitehall moves to end it, Mr Simpson said. However, changes to the funding formula would not happen quickly because of the Conservative Party's dependence on the support of the DUP's 10 MPs, he added.
"How would any new Conservative Prime Minister be prepared to do something which would immediately prejudice his relationship with the DUP, at least until such times as there was an election and the DUP were no longer relevant?" he asked.
"I don't think there's a risk of this (changes to the Barnett Formula) being implemented quickly.
"But I think there is a long-term planning scenario evolving in the minds of London politicians - both Conservative and Labour - and in Whitehall."
Last night a Johnson campaign source dismissed Scottish fears over changes to the Barnett Formula.
"There'll be no change to the Barnett Formula if Boris wins the leadership of the Conservative and Unionist Party and becomes Prime Minister," the source insisted.
"For the SNP to suggest otherwise shows a hitherto unseen level of desperation and underlines just how much they would fear a Conservative and Unionist Party led by Boris."