Thinktank questions Scottish devolution plans

NIESR said that the demand for control of tax and welfare in Holyrood is not matched by a desire for a different policy. Picture: Andrew Cowan

NIESR said that the demand for control of tax and welfare in Holyrood is not matched by a desire for a different policy. Picture: Andrew Cowan

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A LEADING economic think tank has questioned whether handing over new powers to Scotland will produce any changes to life in Scotland.

In a report on devolution, the National Institute for Economic and Social Research (NIESR) has also warned the UK government that the combination of the Smith Commission reforms and English votes for English laws will put direct control of income tax in Scotland beyond the UK government for the first time since 1799.

NIESR noted that the British Attitudes Survey shows little difference in political priorities north and south of the Border and claims politicians in Scotland more often than not promote the status quo on tax and spend.

In a section by Professor David Bell and David Eiser, both of Stirling University, the report said: “We have not found evidence that there are significant differences between Scotland and the rest of the UK.”

Bell and Eiser said this raised question marks over why the SNP are pushing for full fiscal autonomy – control of all tax and spend.

They said: “The argument for further fiscal decentralisation in Scotland thus seems difficult to make.”

The two argued that surveys show the Scottish electorate “places a higher level of trust in the Scottish relative to the Westminster parliament, and is generally supportive of the notion that more fiscal powers should be decentralised”.

But they added: “However, there is relatively limited evidence that the Scottish electorate wants to see radical change to the system of taxation or benefits, supporting the notion that the demand for decentralisation is driven by the desire for local accountability.”

The report, but together by NIESR’s director Angus Armstrong, also supports the argument by pro-UK parties that the effects of the Smith Commission reforms will make the Scottish Government “one of the most powerful sub-central governments in the OECD, in terms of control over spending and taxation decisions”.

And it adds: “If the promised English votes for English laws (Evel) is implemented, income tax, the most visible and highest yielding source of tax revenue, will be put beyond the direct control of the UK government for the first time since it was introduced in 1799.”

The conclusion has been taken by senior Conservatives to underpin their concerns that the SNP has refused to explain what it wants to do with new devolved powers.

A Downing Street source said: “This underlines why the SNP have refused to engage properly in the debate over powers because they know what we are doing on areas like welfare and immigration is largely in tune with what Scottish voters and voters across the UK want.”

But he added: “That does not mean that the SNP can continue to duck the debate over the powers which are going to the Scottish Parliament and explain what they would do with them.”

Labour shadow Scottish secretary Ian Murray MP said: “It is now for the SNP Scottish Government to tell the Scottish people how they will use these new powers. We hear lots about what they would do with the powers they don’t have, but very little about the powers they do.”

The Economic and Social Research Centre on Constitutional Change finds that 72 per cent of people in total support more powers over housing benefit, 69 per cent of people support further powers on unemployment benefits and 67 per cent support more powers over disability.

Mr Murray said: “Labour’s amendment to devolve housing benefit to the Scottish Parliament would unleash billions of pounds for the Scottish Government to plough into solving Scotland’s housing crisis. This survey clearly shows that we have a majority of Scots behind us on this, and the UK government should think again.”

SNP MP Stewart Maxwell said: “These findings simply highlight the fact the limited powers proposed in the Scotland Bill do not meet the aspirations of people in Scotland.

“With these key powers in Scotland’s hands, we can take action to grow our economy and support the working poor and vulnerable people, rather than remaining wedded to Westminster’s obsession with austerity.”

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