Labour would 'address under-funding', says Jones

Carwyn Jones said Labour was committed to "fair funding"

Labour will address "under-funding" of the Welsh government if it wins next year's general election, First Minister Carwyn Jones has assured AMs.

The three main UK party leaders have pledged to keep the current funding system for the devolved governments.

In a letter in a newspaper they promised to keep the Barnett formula if there is a Scottish no vote this week.

But Mr Jones said Mr Miliband had "made it clear" he would deal with Wales' funding issue if he wins office.

Under the current system, Scotland gets more spending per head than the UK average.

Plaid Cymru leader Leanne Wood said the formula would leave Wales £300m poorer each year and the first minister had "failed to win for Wales on funding reform".

But, answering questions in the Senedd, Mr Jones said: "Ed Miliband has made it clear, and this is something I agreed with him, Wales' under-funding will be addressed under a Labour government."

He said his own calls for a convention to address the UK constitution had been "ignored" by the UK government for two years, but had now gained support.

"The old Union will not work from Friday onwards," said Mr Jones.

He said later the idea of 'Home Rule within the UK' - suggested a century ago by Lloyd George - was something he "wholeheartedly" supported and the Senedd was "rapidly becoming the Parliament of Wales".

What could an extra £300m buy the Welsh Government?

• 1-and-a-bit new hospitals - The Ystrad Fawr hospital in Ystrad Mynach cost £172m

• 8 new secondary schools - St Teilo's school in Cardiff cost £38.4m

• 13,000 extra nurses at a starting salary of £22,000

• 7,000 senior teachers on £42,000

• Just under one-third of a new M4 motorway south of Newport - the cost of the whole thing is about £1bn

• Three Gareth Bales - although the Welsh government hasn't got the power to buy footballers - yet

The letter from the three party leaders, which appeared on the front page of the Scottish newspaper the Daily Record on Tuesday, outlined the future of Scotland if there is a no vote in Thursday's referendum.

It promised "extensive new powers" for the Scottish Parliament "delivered by the process and to the timetable agreed" by the three parties.

Welsh Conservative leader Andrew RT Davies said "nationalists" in Wales needed to "stop bellyaching" about the Barnett formula.

"...you can't use it (the Barnett formula) as the only way to address the shortfalls in Wales' income as otherwise you will always be in that dependency culture," he said.

Last month the Liberal Democrats said the formula should stay, but that Wales should receive top-up payments.

On Tuesday, Welsh Lib Dem leader Kirsty Williams confirmed that her party would seek to pursue the policy, if it is in government in Westminster after next year's general election, and challenged the Conservatives and Labour to say how they would resolve the funding issue.

The Barnett formula, named after former Chief Secretary to the Treasury Lord Barnett, was devised in 1979 as a way of adjusting block grants to Scotland, Wales and Northern Ireland to spend on devolved policy areas, on the basis of population.

In 2009 visiting professor at the Cardiff Business School Gerald Holtham headed a commission that prepared a report on the Barnett formula.

He said underfunding could reach £8.5bn by 2019 and described the system as "arbitrary" and in "urgent need of reform".

On Tuesday, Prof Holtham told BBC Wales that people hoping to see the end of the Barnett Formula can "forget it".

He added: "One of the things the Welsh government has been pressing for is a very small change to the Barnett formula that wouldn't affect the Scots, so I suppose it's just about possible that they might get that, but the formula as a whole looks like it's going to be here for some time yet."