A new Scotland Bill will, as the cross-party Smith Commission proposed, devolve income tax to Holyrood, along with Air Passenger Duty and a half share of Scottish VAT receipts, offset by a consequent reduction in the block grant paid from Westminster under the Barnett Formula.
Holyrood will also take over a limited share of welfare policy, valued at £2.5bn, covering payments to carers, disabled people and the elderly, and will be able to vary the frequency – but not the rate, rules or criteria – of Universal Credit.
UK ministers say the new powers will give Holyrood effective control over 40% of Scottish taxes and 60% of public spending. But many commentators in Scotland believe the Smith formula to be inadequate, flawed and impractical, and warn that it could leave Scotland worse off than previously.
Sturgeon has called for devolution of business taxes, National Insurance, and the minimum wage, along with full authority over welfare and employment law. Those demands have not been met.
Responding to the Speech, SNP MP Pete Wishart promised close scrutiny of both the Bill and its timetable.
‘It was 100 days that we were promised that this would be brought forward,’ he said.
‘We want to see that Bill, we want it debated.’
Andy Willox, Scottish policy convener of the Federation of Small Businesses, said: ‘It will be critical to small businesses in Scotland that Parliament gets right the legislation that turns [Smith] into law.
We must see any administrative burden of further devolution borne by the tax authorities and not taxpayers and enterprise,’ he added.
‘Devolution should give different authorities the powers to boost their local economies, however difference itself can’t become a barrier to trade.’
But Scottish Green MSP Alison Johnstone said the Queen’s Speech presaged a wave of new austerity measures and an offensive against employment rights.
‘The Scottish Government must resist this continued assault, and ensure more devolution within Scotland so our communities have more control over their economies so we can create skilled jobs and protect public services.’
Ian Murray, Scotland’s sole Labour MP, said the test for the UK government was to deliver extra devolution without leaving Scots worse off.
‘We will work to ensure the “vow” made during the referendum is delivered in full, and that means keeping the Barnett Formula alongside more powers to make the Scottish Parliament one of the most powerful devolved Parliaments in the world.’
