Smith Commission

Debate between Alistair Carmichael and Geraint Davies

Thursday 27th November 2014 Commons Chamber

[Mr Carmichael]

The question is how the Scottish Government choose to use any flexibility they have. If they choose to cut air passenger duty, they will obviously have to cut some public service provision or raise some other tax. The hon. Gentleman should not assume that flexibility only goes one way.

[Geraint Davies (Swansea West) (Lab/Co-op)]

In Wales, we are required to have a referendum before we have income tax devolution of a much more modest nature. The devolution of income tax in Scotland will have profound implications for migration. In particular, if the Scots lower the top rate of tax, richer people will naturally move to Scotland. If unemployment goes up in Scotland, they will raise tax at the lower rate and reduce public services, because they do not have compensatory borrowing powers. Given that, should there not be a referendum of not just the 8% of people who live in Scotland, but of the rest of the UK? We should not be driven by the 4% of people who voted for independence; the profound implications for migration, taxation and all the rest of it should be decided by the whole of the United Kingdom.

[Mr Carmichael]

That is not how we have done these things in the years since the late 1970s, when such decisions were first mooted. The hon. Gentleman has outlined all sorts of scenarios, many of which are possible, and some of which we may even see. That is what we mean when we say that the United Kingdom changed for ever on 18 September. The duty is on all of us in the political parties and the body politic to come up to the mark and to meet that change. As far as referendums are concerned, I am afraid that I have had enough to be going on with.