Scottish independence: case for wider devolution

The option of a more powerful Scottish Parliament that is still part of the United Kingdom will not appear on the ballot paper of the independence referendum whose date is to be unveiled on Thursday. Yet the debate about how much more devolution Scotland might enjoy should it decide to vote No has not died down.

Detailed proposals for extending the existing devolution settlement have been put forward by both the Devo Plus group and the Liberal Democrats. Labour are due to unveil their initial thoughts next month, while the Scottish Tory leader, Ruth Davidson, has suggested she might be a new convert to the principle of federalism.

For the advocates of more devolution, this is only as it should be. They argue that in insisting that a second question should not appear on the ballot paper, the UK government has denied Scots the opportunity to demonstrate that a stronger Scottish Parliament within the framework of the UK is by far and away the most popular option north of the border.

In truth this is something of an exaggeration. More devolution is not the first preference of a majority of Scots. In the most recent Scottish Social Attitudes survey, just 32 per cent said that they wanted the Scottish Parliament to make all decisions for Scotland other than in respect of defence and foreign affairs – a position that roughly corresponds to so-called “devo max”. That was actually a slightly lower proportion than said they wanted the Scottish Parliament to decide everything, including defence and foreign affairs – 35 per cent backed this idea that equates to independence.

But although more devolution is not the single most preferred option of a majority of Scots, a clear majority are in favour of the Scottish Parliament being responsible for making the key decisions about tax levels and welfare benefits – that is, the two areas of domestic policy in Scotland that are still primarily reserved to Westminster. Indeed, as the first table shows, at 56 per cent and 64 per cent respectively, support for the proposition that the Scottish Parliament should make the key decisions for Scotland about taxation and welfare benefits is almost as high as it is in respect of both the health service (66 per cent) and schools (63 per cent), two areas that are already firmly primarily part of Holyrood’s remit.

Where most people appear to draw the line at granting the Scottish Parliament more powers is at defence and foreign affairs, which is why independence still appears to be a minority cause. However, nearly everyone who thinks that Holyrood should be running defence and foreign affairs is also of the view that it should be responsible for tax and benefit levels – and in this view they are joined by around half of those who want to remain within the UK. Thus, more devolution looks like a potential focus for developing a majority consensus that gives the supporters of independence much of what they want while many unionists get the more powerful body that they would also like to see.

However, any decision to give Holyrood more responsibility for tax levels and welfare benefits has important implications. The more that taxation is devolved, the more the Scottish Parliament will have to fund its spending out of tax revenues raised in Scotland rather than relying on a block grant from Westminster. The more that both taxation and welfare benefits are devolved, the greater the chances that tax and benefit rates will begin to diverge from those in England. We might wonder how far the Scottish public are willing to accept these consequences.

In some respects they are. Just over half (52 per cent) of Scots accept that Holyrood’s spending should be financed out of revenues raised in Scotland, and that proportion rises to 70 per cent amongst those who say that the Edinburgh institution should decide tax levels. That is far from perfect consistency, but it is sufficient to suggest that for the most part those who want Scotland to be able to make its own decisions accept that the country has to run its own finances too.

However, there is rather less readiness to endorse the prospect that key tax rates such as the basic rate of income tax (something that the Scottish Parliament has always had the ability to vary) or benefits such as the old age pension might be different in Scotland than in England.

As the second table shows, only 44 per cent say they think it is OK for the basic rate of income tax to be different in Scotland than in England. True, that figure does rise to 64 per cent amongst those who think that Holyrood should be primarily responsible for tax levels, but even so, a substantial number of those who support the devolution of taxation are evidently anticipating that in practice it would not make too much of a difference.

However, in the case of the old age pension, the resistance to accepting the prospect that the money paid out might be different on the two sides of the border is quite substantial. Overall, only around a third (34 per cent) of all Scots say it is OK for the level of the pension to be different from that in England. Even amongst those who say they would like Holyrood to make the decisions about welfare benefits, only 42 per cent accept the possibility of a different rate.

So far, all of the proposals for more devolution have focused on taxation rather than welfare benefits. The apparent reluctance of Scots to endorse the prospect of different pension rates on the two sides of the border would appear to suggest this emphasis makes sense. Yet perhaps the level of support for giving Holyrood the right to make decisions about welfare benefits – just as high as it is for taxation – should not simply be ignored.

Maybe what Scots are really saying is that they would like to be able to opt out of a common UK system if they wanted to, but they hope that in practice they would not feel the need. That, after all, would mirror the experience of the devolution of welfare benefits in Northern Ireland.

Indeed, what is striking about attitudes towards more devolution is just how little difference it is thought it would make to life in Scotland. There is no greater optimism about what more devolution would bring than there is at present for independence.

For example, just one in three believe that it would result in a better economy or a higher standard of living. Perhaps, in the absence of any consensus so far around any one particular scheme of more devolution, let alone any campaigning for it, the Scottish public, although sympathetic to the idea in principle, have yet to be persuaded of the practical benefits that might flow as a result of pursuing different policies from England.

There is evidently plenty of work for the advocates of more devolution to do if the widespread sympathy that exists for enhanced self-government is to be turned into real enthusiasm.

• More Devolution: An alternative road? by Rachel Ormston and John Curtice is published jointly by the Electoral Reform Society and ScotCen Social Research. The report is available at www.electoral-reform.org.uk and www.scotcen.org.uk

John Curtice is a research consultant and Rachel Ormston is a senior research director at ScotCen Social Research.