SNP's abandonment of 3p tax-raising powers 'irrelevant'

THE row over the SNP government handing back tax- raising powers to London has been dismissed by the former trade union leader drafted in by Alex Salmond to head a review into the future delivery of Scotland's public services.

• Campbell Christie is reviewing delivery of public services

Former Scottish Trades Union Congress general secretary Campbell Christie stepped into the controversy over what happened to the Scottish 3p variable tax rate power, amid mounting pressure on finance secretary John Swinney who delivered his Budget the day before the news about the powers was revealed.

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Scottish Secretary Michael Moore wrote to party leaders in Holyrood that the tax-varying powers, which were voted for in a referendum in 1997 by the Scottish people, would not be available until at least 2013, because the SNP had decided in 2007 not to renew them.

Mr Christie yesterday said the issue was an irrelevance and that the Scottish Parliament needed more economic and fiscal powers to help the economy grow.

He said: "It's a 'ya boo' issue, from my perspective. The mechanism was never used and we need something better than that."

Mr Christie said his commission would look at more "cost effective" and "sustainable" ways of delivering services and ensuring that the "vulnerable don't drop off the edge".

He also said his committee would visit different parts of Scotland to look at how services are delivered ahead of publishing a report next summer, which he said he hoped "would be implemented" by whichever party was in power after next year's Holyrood elections.

Meanwhile, First Minister Alex Salmond insisted that his finance secretary's Budget statement earlier in the week about taxes was not misleading and that ruling out raising the variable rate had "always been our position".

He said: "John (Swinney] was stating what is true - that we don't have proposals to raise taxation in Scotland because we think it would be the wrong thing to do.

"Our proposal is to have Scotland to have the economic powers to enable us to grow our economy out of the Westminster cuts."

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Mr Salmond said Scotland's councils had been offered an "exceptional" deal to help shield them from spending cuts. The SNP government's budget for the year ahead will limit local authority reductions to 2.6 per cent, if they agree to implement key SNP policies such as the council tax freeze.

Liberal Democrat finance spokesman Jeremy Purvis accused the First Minister of "dishonesty" over tax-varying powers. Mr Purvis said: "The SNP have no credibility ever again to talk about financial powers for this parliament, when they unilaterally removed constitutional powers of the parliament that were given to it by the people of Scotland in a referendum.

"We have exposed dishonesty right at the centre of the SNP government."The First Minister told television viewers that the SNP didn't intend to use the tax varying powers, which is why they cancelled them without any discussion or announcements in 2007.

"But in March 2008, his government published proposals to introduce a Local Income tax.

"The proposals stated that the mechanism 'provides a basis for the arrangements that will be needed to implement a local income tax'. The proposals went on to say that tax varying powers 'could be introduced relatively quickly'.

"We now know that this couldn't be done because SNP Ministers had already got rid of the tax varying power mechanism. They were dishonest then and today's performance from the First Minister shows that they are dishonest now."