New finance powers for Holyrood to be scrutinised at Westminster

Published on Thursday 6 January 2011 17:01

Plans to give Holyrood a wider scope of powers are to be debated by a Westminster committee, which will examine whether they will leave Scotland better off.

The Scottish Affairs Committee will look at the impact of the Scotland Bill, set to be introduced by coalition government, with committee chair Ian Davidson saying a key issue will be the impact proposed changes would have on Scotland's finances.

The Bill aims to build on the recommendations of the Calman Commission, set up by Labour and the Liberal Democrats to look at ways the devolution settlement can be improved.

Under the proposals, the Scottish Government would be given the power to borrow 2.7 billion.

Scottish ministers would also be granted greater income tax powers as well as control over other taxes, although the Scottish block grant would be reduced.

The coalition Government at Westminster has said it hopes the measures in the Scotland Bill will make the Holyrood administration more responsible for its finances, but the move has been criticsed by the SNP who have said it equates to cuts by the back door.

Mr Davidson said: "It's been suggested that Scotland would have been either worse off or better off in the last five years, had the new system been operating

"The Scottish Government has said it would be worse off and the minister has said it would be better off, so some examination of that will be helpful."

While stamp duty, landfill and other taxes would be devolved under the proposals, corporation tax, North Sea excise duty and VAT would still be controlled by Westminster.

Mr Davidson added: "We want to hear people's views on the things that Calman had but the Bill doesn't, and vice versa."

The committee is urging people to write to them with their views on the Bill and will hold evidence sessions before publishing its report later this year.

A Holyrood committee has been established to scrutinise the proposed legislation, with MSPs already having heard from Scottish Secretary Michael Moore and Finance Secretary John Swinney.