David Cameron: Control passes over to where it belongs - with the voters of Scotland

Yesterday Scottish Secretary Michael Moore launched our proposed Scotland Bill in Edinburgh.

The bill implements the recommendations of last year's Calman Commission, which itself was established through multi-party support and delivers the commitment we made in our coalition agreement six months ago.

But ignore the dry, technical process. The reforms we are setting out mark the biggest change in the way Scotland is run since devolution.

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A whole host of new powers are going to be transferred closer to you - taken from Westminster and given to Holyrood.

The biggest changes concern taxation, spending and borrowing. For eleven years now, Holyrood has had the power to spend money on schools, hospitals, transport and justice as it decides.

But it has raised little of this money itself, depending instead largely on the block grant from Westminster. This doesn't make sense. If you believe in people power and accountable government, the two should be joined up.

Scottish politicians, who better know the needs of the economy and the will of the people, should be able to both spend money and raise taxes - and then be prepared to be judged at the ballot box for those decisions.

So that's what's now going to happen. A new Scottish rate of income tax is going to be introduced, and before you think this sounds like a further drain on your pocket, this is how it will work.

Income tax in Scotland will be reduced by ten pence for the basic, higher and the 50p rate. The Scottish Parliament will then make a decision to levy a tax on top of that reduced rate. So, for example, the basic rate of tax will go down from 20 pence to ten pence.

Scottish Ministers will then decide whether to put it back up to 20 pence, or maybe just to 15 pence or even, if they wish, to 25 pence - keeping all the extra money the Scottish rate raises.

Either way, they decide. And crucially, because Scotland's block grant will be adjusted by the initial ten pence reduction, the impact on the public services budget will be in their hands too.

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In addition, Scotland will also get full control over stamp duty, land tax and landfill tax, and be given the power to borrow more money to invest in its infrastructure.

But quite apart from these big economic changes, our Scotland Bill also transfers other powers to Holyrood. So for the first time, Scotland will be able to set its own drink-driving and speed limits, and regulate air weapons.

These may seem small changes, but as Calman said, devolution is working well and the current balance of powers between Holyrood and Westminster is broadly right.

So we haven't reinvented the wheel.Instead, we have looked at where there are areas of specific local concern - and transferred powers accordingly.

Yesterday was St Andrew's Day - and it's symbolic that it was the day that we announced the largest transfer of power to Scotland since devolution.

These changes will strengthen the UK and strengthen devolution - but most importantly, they will strengthen Scotland.

That's what real respect means. And that's why I know Scotland can look forward to such a bright future.