Scotland given £500m sop for Crossrail

Amid signs that the Tories will present themselves as the "English party" at the next election , David Cameron said for the first time that he would review the controversial Barnett formula that allocates cash to different parts of Britain.

The Standard has discovered that, under the formula, Scotland will automatically receive a huge payment to compensate for Crossrail's £16 billion worth of spending in the capital.

The revelation prompted fresh claims that the cash windfall will be used to subsidise free university tuition, elderly care and other perks.

A poll yesterday showed that one in three English voters now favours a break-up of the union with the Conservatives determined to highlight Gordon Brown's Scottishness. Mr Cameron is pushing a plan to allow only English MPs to vote on English affairs at Westminster. But a much bolder move is the review of the Barnett formula, which means the Scots end up getting £1,500 more per head a year than the English.

The Tories have always been wary of tackling reform of the formula, first devised in the 1970s, but senior sources suggest that the party now has nothing to lose. Mr Cameron signalled the change. "It is a question we ask ourselves and we are right to do so: Is the Barnett formula right for the year 2007 and beyond?" he said.

MPs of all parties are already worried-that English voters resent subsidising free university tuition and care for the elderly north of the border. There is increasing anxiety that Scots are now also in line for free school meals for all and free prescriptions under the Scottish Executive, which is led by the Scottish Nationalist Party.

Now even Labour MPs are complaining about the Barnett formula after the revelation about Crossrail. Jim Cousins, a Labour MP on the Treasury select committee, said: "There is a great slug of money, a Crossrail bonus going to Scotland, that reappears in free prescription charges, free home care, free everything else, extra grants for heating, abolition of the graduate endowment.

"When is there going to be a north of England bonus?"

Chancellor Alistair Darling said: "The Barnett formula means that there is an automatic consequential expenditure for Scotland. To my mind, if you have got a Barnett formula, you can't pick and choose where you apply it."

The Tory plans for English votes for English MPs are being drawn up by ex-minister Sir Malcolm Rifkind. They would involve a "grand committee" voting on areas such as education and health.