Plaid Cymru has called for an independent committee to be established to oversee a fairer public funding formula for Wales, based on the needs of the nation.
Parliamentary leader Elfyn Llwyd said the party would be working on proposals not only for a needs-based formula, to determine how much public money Wales should receive from Westminster, but also the creation of an arms-length organisation to administer it.
The proposals come amid concerns the current Welsh block grant is not only unfair but also open to political manipulation.
Mr Llwyd and Plaid's economics spokesman Adam Price have just returned from Belfast where they held all-party talks aimed at securing a fairer funding formula for the UK's nations and regions.
Plaid wants the current Barnett Formula to be scrapped, arguing it causes Wales to miss out on hundreds of millions of pounds of public money every year.
Mr Llwyd said, 'There is a definite consensus that the current Barnett Formula is hurting Northern Ireland as well as Wales and everyone acknowledged the need for a needs-based formula to replace Barnett.
'We will now be putting together an issues paper and distributing it to all the parties we met in the hopes of beginning a real dialogue.'
In 1997 a Treasury report suggested that Wales was getting about 2% less than it would if the formula was based on need.
Based on the Assembly's current budge of about £11bn a year, a 2% slice of extra funding would amount to £200m a year, enough to pay for 20 new schools or hundreds more teachers, firefighters, police officers and nurses.
The Lyons Review of funding has raised hopes the Treasury is preparing to ditch the outdated Barnett Formula but there is currently no indication on whether an alternative system would be primarily based on need.
Mr Llwyd said parties in Wales and Northern Ireland would be working on their own ideas for a needs-based formula to replace Barnett.
They also want an independent Grants Commission similar to that established in Australia to distribute the funding and prevent political meddling.
Wales gets a proportionate share of all public money spent in the United Kingdom through its block grant.
But Mr Llwyd said many major capital projects, like the Millennium Dome and Jubilee Line in London, were kept off the Treasury's books, meaning Wales never receives its share of the cash.
'The Grants Commission would apply the needs-based formula to all public money,' he said.
'In the past what has been listed as 'identifiable' public expenditure has been entirely a political decision and we believe an arms-length body would just apply the formula purely and simply in Wales, Scotland and Northern Ireland.'
Proposals will be worked out with financial experts over the autumn and winter to be ready by next spring.
Joel Barnett drew up his own calculation for public expenditure in 1979 but it was only designed to be a temporary measure and was based on what the peer now calls a 'back of an envelope' calculation.
Wales' share of public funding is expected to form a central plank in Plaid Cymru's fight for Assembly seats in the 2007 elections.
Mr Llwyd said, 'We want all the distribution taken out of the political regime altogether and a formula-based on need.'