Council taxpayers in England losing out on £2.6billion in services because of Scottish funding formula But now its unfairness and plain illogicality mean it is time to move on. Unlike every other part of the public sector, the Scottish, Welsh and Northern Irish governments get their money automatically. Sir Merrick complains that "whenever an English department gets a change to its budget, the other countries of the Union get an automatic share, with no questions asked." He is particularly incensed that when the Coalition froze council tax for English councils, an extra £67.5million was given to Scotland, even though its government had already announced a freeze He adds: "Therefore Scotland got extra money this year because English councils were being paid to freeze their council tax - even though Scotland already had a council tax freeze." The way the formula works means that Scotland and Wales receive money because the Crossrail tunnel is being built in London, he says. The formula was devised by Lord Barnett, the Labour chief secretary to the Treasury, in the 1970s as a short-term measure. He has since suggested it should be reformed. Sir Merrick adds: "Lord Barnett himself never expected the formula to last more than a few months, let alone 30 years. It has become grossly unfair, divisive, and outdated. Let's find a new formula in 2012 and put the inadequacies of Barnett behind us. The formula is devised to ensure that changes in public expenditure in one geographical area lead to alterations elsewhere proportionate to population rather than need. Despute a growing discrepancy in the formula between England and Wales, successive governments have refused to overhaul the system. It means Scots receive 10 per cent of the money handed out by Whitehall, despite having little more than eight per cent of the population Treasury figures last year showed that gap in annual government spending between Scotland and England has risen to a record £1,600 per person In Scotland, the Government spent £10,212 per person on average last year - £1,624 more than in England.