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30 June 2009

Deciding Scotland’s future

Ten years on from devolution and the reconvening of the Scottish Parliament, it is entirely fitting that discussion of the arrangements by which Scotland is governed should again be high on the agenda.

The Scottish Government’s National Conversation continues to engage with thousands of people across Scotland in discussing the future of our nation. A white paper on its findings and the case for independence will be published on St Andrew’s Day with a referendum planned for 2010. Meanwhile, the Calman Commission has reported ahead of schedule with a number of recommendations for changes to the devolution framework.

The Calman Commission’s report contains some proposals that people of all political persuasions can surely get behind. Devolving air gun legislation to Holyrood will allow the Scottish Government to address a problem that the UK Government has thus far failed to tackle. Similarly, devolving control of drink-driving limits would allow legislation to be tightened in Scotland in order to make our roads safer and save numerous lives every year.

Yet the most prominent recommendation that the Calman Commission has made is for a new system of financing the Scottish Government and sadly it is one that can only be regarded as a missed opportunity.

The report recommends a system of devolving the control of certain taxes generated in Scotland to the Scottish budget, lowering the income tax collected by the UK Government by 10 pence in the pound and then setting a Scottish income tax that would go directly into the Scottish budget. The block grant that makes up the Scottish budget would be lowered by £6 billion to reflect these changes.

Unfortunately, the recommendations expose the Scottish budget to the uncertainty of fluctuations in how much tax is generated without the financial levers to fully affect economic policy. The income tax being proposed would be a flat rate across all the tax bands with no opportunity to make it progressive or alter the banding thresholds. The proposals have been branded as ‘seriously flawed (if not illiterate)’ by one of the financial experts involved in the Commission, Professor Andrew Hughes Hallet, demonstrating the level of disquiet they have caused amongst experts. With the Scottish Government only gaining the power to borrow for capital projects rather than short term revenue shortfalls under Calman’s recommendations, the inevitable result of income tax takes falling – as they currently are – would be for schools and hospitals to close.

Scotland certainly needs more responsibility for generating the money that is spent here, but the proposals the Calman Commission have made are the worst of both worlds. What is needed for Scotland is full fiscal autonomy, something that only the SNP will deliver through independence.

Ultimately the decision on whether to adopt the Calman Commission’s recommendations or not, or indeed to move towards the status of a normal independent country, must be ones taken by ordinary people not politicians. The referendums on whether the Scottish Parliament should be reconvened and whether it should have limited tax varying powers firmly established the principle that it is for the people of Scotland to decide their constitutional arrangements.

There can be no question of making the kind of changes that Calman recommends without giving people in Scotland their chance to have a say in another referendum. The SNP Government is determined to put the decision on our preferred option of independence in the hands of ordinary people through a referendum. If the unionist parties believe in the strength of the recommendations made by the Calman Commission, they must be prepared to do the same.

Stewart Stevenson
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