Lord Barnett: Architect of formula

Lord Barnett will say it must abandoned so that more money can be directed towards the English regions.

He believes that under the existing system Scotland is receiving too much money.

However, Treasury ministers at Westminster are adamant that there should be no review at the moment.

Each year the Treasury calculates the amount of money Scotland gets from the central exchequer.

Part of the figure is worked out according to the Barnett formula - it does not actually determine the amount of public spending but the way in which changes are distributed.

The figures are subject to fluctuation due to factors such as population but, in broad terms, if �100m extra is allocated to the public purse, �85m will go to England, �10m to Scotland and �5m to Wales.

Regions of northern England have long felt hard done by in the way the government at Westminster divides up public spending, claiming Scotland gets more than its fair share.

Devolution has only heightened those divisions.

Scotland allegedly receives too much funding

The decision by the Scottish parliament to defer university tuition fees and plans for free personal care for the elderly have once again reopened the arguments about how the financial cake is allocated.

The formula was not changed by the Thatcher government or the Major government and many commentators believe it will not be changed by the Blair government.

Ministers believe that by maintaining the status quo, a damaging annual wrangle between Whitehall departments and the Scottish Parliament will be avoided.

Before devolution came into being, it was agreed that the Barnett Formula should remain in place.