MSPs demand wider remit for Scottish Fiscal Commission

5 Jan 16

The remit of the Scottish Fiscal Commission should be expanded to include independent forecasts of devolved tax revenues and examinations of the Scottish Government’s performance against its fiscal rules, MSPs have said.

In a report on the legislation to formally create the commission, the Scottish Parliament’s finance committee said a “substantial widening” of its role would improve independent scrutiny of Scotland’s public finances.

The commission was established on a non-statutory basis in June 2014 to provide independent scrutiny of the government’s forecasts for the two taxes devolved last April: the Land and Buildings Transaction Tax and the Scottish Landfill Tax.

Ahead of the devolution of additional fiscal powers to the Scottish Parliament, including full retention of income tax, ministers have proposed to place the commission on a statutory basis. Additional responsibilities will include examination of forecasts for receipts from the new Scottish rate of income tax, as well as borrowing projections.

However, the committee said today the commission should be responsible for producing the official forecasts for the devolved taxes, rather than assessing the Scottish Government’s figures.

Convener Kenneth Gibson stated that the SFC would have an important role in providing independent scrutiny of the public finances in Scotland. 

“However, we are strongly of the view that not only should the Scottish Fiscal Commission be independent, but it is vital that it is perceived to be independent. That is why we are calling for the Bill to be amended to strengthen the commission’s role and to give it responsibility for producing the official forecasts.

“We’re also calling for amendments to give the commission a much wider role. We believe it should assess the Scottish Government’s adherence to its fiscal rules and assess the long-term sustainability of the public finances. This will further strengthen the independent scrutiny role of the commission and reflects the view of many witnesses who have appeared before the committee.”

Responding to the report, a Scottish Government spokesman said: “We welcome the Committee’s support for the principles of the Bill and we will reflect carefully on the issues raised in the report.”

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