The announcement by David Cameron and Nick Clegg that Wales is to be offered new tax and borrowing powers should be a concern to those in Scotland seeking more powers for the Scottish Parliament, short of independence.
Welsh income tax powers, proposed last year by the Silk Commission, will have significant implications for Scotland. If passed by a future referendum, Cardiff Bay’s powers will be greater than Holyrood’s on income tax.
Wales will be able to set variable rates across most or all tax bands while Scotland’s powers are heavily circumscribed, because Holyrood must raise or lower all the main tax bands by the same amount – it has no flexibility at present to cut lower rates and raise higher rates. This makes it a clumsy fiscal tool.
Prime Minister Cameron has pledged that a substantial increase in financial powers will not be coming to the Scottish Parliament should independence be rejected, and the Labour Party has still to put forward any solid proposals, with the ones floated paltry fare when compared with the Welsh example.
In addition, should these proposals be forthcoming, there is no guarantee that they will ever see the light of day – and one only has to remember 1979 and the call by the Tories for Scots to reject the Scottish Assembly with the promise that they would introduce something better.
As it stands, Scots will be going into the polling booths on 18 September, 2014 with the prospect, should independence be rejected, of a parliament which will have less power than the Assembly in Cardiff.