Scotland Bill

Monday 2nd November 2015 Written Statements

[The Secretary of State for Scotland (David Mundell)]

The UK Government are delivering on their commitment to make the Scottish Parliament one of the most powerful devolved Parliaments in the world. Every deadline has been met in bringing forward new powers to the Scottish Parliament, and another milestone will be reached on 9 November when the Scotland Bill has its Report and Third Reading.

The Scotland Bill delivers the Smith Commission agreement in full. The agreement was reached by Scotland’s five main political parties, and it means the Scottish Parliament will have control over around £11 billion of income tax revenues and responsibility over welfare benefits worth approximately £2.7 billion (by 2014-15 figures). For the first time, more than 50 per cent of the Scottish Parliament’s budget will be funded from revenues raised in Scotland.

The Joint Exchequer Committee has met four times since June 2015 to take forward negotiations on Scotland’s fiscal framework. The meetings have focused on key elements of the framework—block grant adjustment and subsequent indexation mechanisms, administration and implementation costs, the no detriment principle, capital and resource borrowing, VAT assignment, fiscal scrutiny and governance. Discussions have been constructive and are focused on securing a fair and workable fiscal framework which delivers the recommendations made by the Smith Commission in its report of November 2014.

Work is continuing and both Governments aim to complete this work as soon as possible in order to give respective Parliaments time for due consideration of both the fiscal framework and the Scotland Bill. This is likely to be after both the UK spending review and the draft Scottish Budget. Since the Scotland Bill’s introduction to Parliament in May 2015 it has been subject to healthy and productive scrutiny, including five days of debate in the House of Commons so far. During this time I have spoken to people from organisations representing the range of Scottish public life about the new powers the Bill contains, as have my ministerial colleagues. I have worked with the Scottish Government to seek their views, and committees of the UK and Scottish Parliaments have taken evidence and reported on the Bill’s provisions.

Throughout this work I have been clear that I would reflect on sensible and constructive suggestions made. Today I am tabling amendments to the Scotland Bill. I have listened to the debate and I am responding with amendments designed to improve the effectiveness of the legislation and to ensure that the new powers for the Scottish Parliament work as the Smith Commission intended. Part 1 of the Bill relates to constitutional arrangements. An amendment will strengthen the clause on the permanence of the Scottish Parliament and Scottish Government by including a provision that includes a requirement that the Scottish Parliament and Scottish Government should not be abolished except on the basis of a decision of the people of Scotland. While the UK Government are clear this is a scenario that has never been envisaged, the amendment is intended to make clear that there is absolutely no doubt: Holyrood is here to stay.

Additional amendments to Part 1 provide technical refinements to the elections clauses, and ensure the Scottish Parliament is responsible for relevant provisions related to the operation of the Scottish Parliament and Scottish Government.

Part 3 of the Bill includes provisions on welfare. The amendments will give further flexibility to the Scottish Parliament on benefits in relation to carers, and will enable the Scottish Parliament to legislate to provide for forms of non-financial assistance with a view to reducing maternity expenses, funeral expenses or expenses for heating in cold weather. There will no longer be a cap on the amount of discretionary financial assistance an individual who is in receipt of a reserved benefit can receive to assist with rental costs. The discretionary financial assistance must still be provided to help the individual with their housing costs and additional spending must be funded by the Scottish Government. The Smith agreement stated that universal credit will remain a reserved benefit to be administered and delivered by the Department for Work and Pensions, and Scottish Ministers to make decisions about varying the housing costs within universal credit for claimants who rent their homes as well as deciding when to pay those housing costs direct to landlords. A co-operative approach between the UK and Scottish Governments will be essential and amendments will clarify the Secretary of State’s role in agreeing to universal credit regulations that can be laid by Scottish Ministers.

Paragraph 54 of the Smith agreement relates to the power to create new benefits in devolved areas. A new clause will be tabled to address this.

The remaining parts of the Bill transfer substantial powers to the Scottish Government and Scottish Ministers. Amendments will be tabled to clarify the approach taken to the devolution of tribunals and to the Crown Estate. In response to feedback from stakeholders the clause on equal opportunities has been amended in order to better set out the powers to be devolved. Other amendments strengthen the delivery of the Smith agreement on the clauses relating to fuel poverty, onshore oil and gas licencing, consumer advocacy and advice and the office of communications. A new clause ensures the destination of Scottish fines, forfeitures and fixed penalties can be made explicit in primary legislation where necessary.

The Smith Commission agreement outlined a number of areas for further consideration, and the UK and Scottish Governments have taken forward discussions on each of those. As a result of those discussions I am tabling amendments to devolve abortion policy and responsibility for welfare foods to the Scottish Parliament. The amendments tabled today will strengthen the Scotland Bill and represent another milestone in making the Scottish Parliament one of the most powerful devolved parliaments in the world. I look forward to this important piece of legislation returning to the House for debate next week.

[HCWS282]