Pogs The Barnett formula is an interesting one. As you will know everytime there is an increase in an English budget - Education, Health, etc. there is a corresponding per capita increase in that portion of the Scottish budget. How that extra money is spent is then up to the Scottish Parliament. However since the Conservatives came to power all we have had are budget cuts, with corresponding cuts in the Scottish Block Grant. Increases in VAT, Income tax or cuts to benefits, the armed forces, etc leave Westminster with more money in their coffers but none of this comes to the devolved parliaments. So there is a very real squeeze, with worse to come as NHS services are privatised in England, hopefully making savings in the NHS budget there, which will have a knock on effect under the Barnett Formula of severe cuts in the Scottish Budget for Health. There is little scope for making cuts in Scotland, where services need to be provided to geographically scattered communities. Specialised services have already been centralised as much as possible but costly local services, GPs, Midwives, air ambulances for example must be maintained in the Highlands, Islands and Borders.
If Scotland votes Yes the country will be able to meet these challenges from its own resources but in the event of a NO vote I agree that it would be necessary to change the formula in order to have a fairer distribution of wealth (& poverty) within the UK. Unfortunately, neither the Westminster Government nor any of the three main UK parties have this issue on their radar. They are not even campaigning on a 'Vote No and we'll give you more' ticket. There have been vague statements to the effect that Scotland could be granted powers to collect and keep some taxes but that would be balanced by cuts to the block grant. A classic re-arranging the deck chairs on the Titanic idea.
Personally, I would prefer to have a Pound Scots in my pocket, rather than either the Euro or Sterling, but I bow to the superior knowledge of Alex Salmond and John Swinney, both successful economists by profession before they came into politics. They argue that it would reduce instability for both countries, certainly during a transitional period and make life easier for businesses who would be able to continue to trade across the border without currency adjustments. Eire retained the £sterling for some time after it became independent before moving to the Irish Punt and later adopting the Euro. SNP policy changed from going straight to the Euro when it became obvious that the Euro was having big problems. Now is not the time to become voluntarily tied to the Euro, but who knows what the future will bring. If England votes to come out of Europe it might well be to Scotland's advantage to stay in. Only with Independence will we be able to make that choice for ourselves.