DAVID Cameron framed his “Carlisle principle” in characteristically pejorative terms. “This is about making sure we understand the impact that devolution is having and make sure that rest of the country never unwittingly loses out,” he said.

The none-too-subtle assumption lying behind the Prime Minister’s new Treasury wheeze is a familiar one: featherbedded, overfed, gannet Scotland, addicted to public spending and gobbling up the wealth of England, needs keeping a weather eye on. The Prime Minister is in an electoral tight spot south of the Tweed, and hopes to fight clear of the underbrush with a toot on Nigel Farage’s dog-whistle: “The Plain People of England have been bally patient with you, Scotland, we’ve indulged you, but up with this we will not put.”

Cameron’s assumption that England is getting fleeced by canny but self-interested Scots needs looking at. Too often, the current devolution settlement gives the Scottish Parliament and Government perverse incentives to adopt policies that sidestep central government accounting. And much of this perversity leads right back to the embossed door of the Treasury department, which Cameron wants to audit the relative wealth of the home nations.

Holyrood has not had its troubles to seek with Chancellors and their apparatchiks when decisions of the Scottish Parliament poured cash into the UK exchequer or didn’t fit neatly into the bureaucratic categories of the British state. Even Jack McConnell had his share of quiet tiffs with Whitehall’s controlling mandarins of finance.

Why? Because the Treasury is all too happy for the Scottish Parliament to part with its cash and to fund programmes, but has been remarkably reluctant to pass the financial benefits of sound choices back to Holyrood. Want to introduce a fairer system of local income tax? In that case, we’re keeping your share of council tax relief.

Want to introduce publicly funded childcare to liberate more people to pursue jobs, increasing economic activity and bringing in more tax receipts? Capital notion. But we’re keeping the extra cash that will generate. Your bloc grant will not be adjusted accordingly. What’s that? Funding free personal care for the elderly saves the exchequer a shedload? Well, bully for you. But we’re not adjusting your budget to reflect the UK gains made on the back of your sensible choices. Your block grant may go up a quid of two, but you won’t see anything like the full fiscal benefits of your spending. That has been the Treasury mantra.

Take another example. A 2013 Institute for Fiscal Studies report concluded that higher spending on social housing in Scotland has seen the UK Government reap the benefits of reduced expenditure on housing benefit.

“The Scottish Government is bearing the cost of greater investment in social housing and lower rents, whilst some of the benefits of that spending accrue to the UK Government in the form of lower housing benefit payments,” the think tank said.

Cameron clearly has hard done-by English regions in mind in the dark hints he drops about “taking compensatory action” against Scotland. But the Scottish Government has little to fear from this audit. If Cameron manages to claw his way back to re-election, he may well find himself in the dock, scribbling an IOU.