Scotland Bill poses risk to nation’s finances - Holyrood committee

Published on 19/12/2011 11:34

A Scottish Parliament committee has warned that changes to devolution in the Scotland Bill risk damaging the country’s finances and will be opposed unless significant new powers are added.

MSPs made 45 recommendations to the legislation, presently at Westminster, including greater control of taxes and borrowing powers.

Linda Fabiani, convener of the Holyrood committee that scrutinised the proposals, said: “There are elements of the Bill which the whole committee can welcome. However, overall, we believe that the Bill does not go far enough and its provisions, if enacted, represent a significant risk to public finances in Scotland.

“Our report concludes that whilst the Bill delivers a very limited amount of financial accountability, it does not deliver what Scotland needs which is full fiscal autonomy.”

The Scotland Bill was drawn up by the UK Government to make changes to devolution. It proposes a new Scottish income tax rate, devolution of stamp duty and borrowing powers, among other measures.

Holyrood would be given responsibility for air gun regulations, drink-driving limits and the national speed limit.

But the financial package has proved controversial. The SNP-dominated Scotland Bill Committee split along party lines on some recommendations, with a minority report setting out the opposition’s view.

However, there was unanimous support for the proposed £500 million borrowing cap to be doubled and for air passenger duty to be devolved. The committee also wants wider power to set all speed limits and for control of the Crown Estate.

The SNP and Green Party members of the committee supported calls for control of all income tax bands, saying that the UK Government should pay for the costs of setting up the tax powers. The two parties also want revenues from excise duties on alcohol to be assigned to the Scottish Parliament.

The SNP wants control of corporation tax.

The report concludes that the committee cannot recommend that the Scottish Parliament approves the necessary Legislative Consent Motion on the Bill. By convention, the Westminster Parliament does not normally legislate on devolved areas without consent.

Bruce Crawford, the Scottish Government minister responsible for parliamentary business, said: “I welcome this report and trust that the UK Government will give careful attention to its findings, as the Secretary of State for Scotland (Michael Moore) rightly pledged to do. We await the UK Government’s response to the committee report with interest.

“The priority for the Scottish Government is strengthening the Parliament’s ability to build sustainable economic growth and create new jobs and prosperity, which the people have clearly voted for.

“That is why we are keen to make progress on improving the Scotland Bill, and the Scottish Government and Parliament will be in a position to consider the matter of legislative consent once the Westminster coalition has taken the opportunity to give the report’s recommendations the care and attention Mr Moore confirmed they would, and come forward with their proposals.”

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