Smith commission begins Scots devolution talks

22 Oct 14

Lord Smith of Kelvin’s Commission, set up after last month’s independence referendum to formulate the enhanced devolution promised to Scottish voters by the Better Together campaign, is this afternoon holding its first cross-party negotiating session.

The Edinburgh meeting will bring together two representatives from each of the three unionist parties with senior figures from the pro-independence Scottish National Party and Scottish Greens, both of which agreed to join the process in the hope of maximising the new powers to be delivered to the Holyrood parliament. Many outside bodies and individuals are also submitting views

Smith, an industrialist, remains confident that the commission can reach agreement by the scheduled deadline of late November, ready for draft legislation in January. Many critics, including the Commons political and constitutional reform committee, have expressed doubts, and former Labour First Minister Lord McConnell has warned that a quick ‘back-room deal’ will not be stable.

Today’s initial meeting was expected to highlight the wide variations between the respective proposals, particularly in respect of tax powers and welfare devolution.

On tax, the party proposals are:

SNP:  All taxes and full borrowing powers devolved to Scotland, including oil revenues, with payments to the UK Treasury for limited reserved powers like foreign affairs and defence.

Labour: The 2012 Scotland Act power for Holyrood to vary the income tax basic rate above 10p should rise to 15p, with a new power to raise the top rate. The Barnett Formula stays.

Conservatives: Holyrood should have full power to set income tax bands and rates, and should receive a share of VAT revenues.

Liberal Democrats: Holyrood should be able to raise most of the revenue it spends, with the UK controlling spending on defence, foreign affairs and social protection. Barnett stays.

Greens: Holyrood should have full control over income tax, plus a share of revenues from VAT and corporation tax, and full borrowing powers.

There is similar diversity on welfare policy, which emerged during the referendum campaign as a key area in which Scottish voters feel that Westminster is failing to reflect Scottish values.

Labour would devolve Housing Benefit and Attendance Allowances, with the Tories taking a similar view plus a possible extra power to supplement UK benefits. The SNP and Greens want total or near-total welfare devolution, while the LibDems want a single regime across the UK.

Other areas of disagreement exist over whether to devolve functions like immigration, pensions, employment policy, broadcasting and asylum.

Four of the five parties are fielding former Scottish leaders on their commission teams: Finance Secretary John Swinney for the SNP, Iain Gray for Labour, Annabel Goldie for the Conservatives and Tavish Scott for the Liberal Democrats. The Greens are represented by their current co-convenors, Patrick Harvie and Maggie Chapman.

 

  • Keith Aitken
    Keith Aitken

    covers Scottish affairs for Public Finance from Edinburgh. He was formerly economics editor and chief leader writer on The Scotsman and now has a busy freelance career as a writer, broadcaster and event chair.

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