9 February 2011
Finance Secretary John Swinney has rejected claims that the Scottish Government failed to provide the UK Treasury with any detailed analysis of its case for full financial autonomy.
Giving evidence to the Scotland Bill committee on February 8, he insisted that his officials had engaged in thorough discussions with Whitehall on why current plans to give Scotland limited control of income tax were inadequate.
The Scottish Government believed that only full fiscal autonomy would significantly improve the accountability of the Scottish Parliament and ensure that Scotland had the right ‘levers’ to improve economic growth, he told MSPs.
Swinney was appearing before the Bill committee for the second time. He was recalled after MSPs had voiced concern over the lack of any detailed information on why Scotland should be given greater powers than those proposed.
Committee convener Wendy Alexander put it to the minister that the Scottish government had produced no details of its case, no amendments and no ‘modelling’ for full fiscal autonomy. She said all the government had provided was a single piece of paper summarising its case.
Swinney said it had provided a full timeline of the dialogue that had taken place between ministers, his officials and their counterparts at Westminster.
He argued that Scottish Secretary Michael Moore had ‘fundamentally misled’ the committee by claiming there had been ‘no dialogue about substance’.
Swinney submitted documents to the committee outlining a series of ministerial meetings and written correspondence to the Treasury.
According one of the documents, on increased financial powers, the Scottish Government believes that all taxes, with the exception of VAT, should be set in Scotland.
From these revenues, Scotland would pay Westminster for UK services such as defence and foreign policy.
Holyrood would control 85% of Scottish tax revenues compared with the Bill’s proposal, which gives Westminster control of 93%.
According to the Scotland Bill – drawn up following an inquiry by the Calman Commission into Scottish devolution – income tax in Scotland would be reduced by 10p in the pound, with an appropriate reduction in the block grant.
The Scottish Parliament would then have the power to set a tax to make up for the shortfall or alternatively increase it or decrease it.
