To GVA or not GVA, that is the question?

The Western Mail runs the story today that Wales is being robbed of £2 billion pounds per annum because of the inadequacies of the Barnett formula.

According to Lord Barnett himself,

"This week’s IPPR report compared spending levels against GVA (Gross Value Added) per head, a standard measure of prosperity. On the basis of the calculations, London and Scotland receive more than they would get under a needs-based formula, while Wales gets 14% too little – around £2 billion".

At long last, someone realises that we are getting shortchanged and I hope that Welsh politicians of all parties at the Assembly and Westminster will put this issue as their main priority.

However, can someone please tell the Assembly Government to stop being in denial about GVA as we will get nowhere unless they start facing the rela economic situation in Wales.

For the last few years, they have been rubbishing the fact that, according to GVA per head, we are the poorest region in the UK. In stead of accepting this, fighting for more funding from Westminster and developing a strategy for addressing this situation, they have become obsessed with finding other statistical evidence to counteract the real evidence about the economy.

For example, only last month, a spokesman for the Assembly Government said:

“Gross disposable household income (GDHI) directly relates to income levels across all households in Wales, and is therefore a better aggregate measure of living standards than GVA, which doesn’t include important components of income. The latest GDHI figures show that levels in Wales have increased by 32.3% since 1999 – the biggest percentage increase per head of population compared with all other parts of the UK – including London.”

So what is it going to be with a review of Barnett?

Are we going to use GVA/head which will not paint the Assembly Government in a good light but will at least get us the best settlement possible, or are we going to use other measures such as GDHI which will save some political face, but will mean far less money being allocated to Wales?

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