Scotland Bill

Debate between Fiona Bruce and Pete Wishart

Thursday 26th April 2012 Commons Chamber

[Fiona Bruce (Congleton) (Con)]

Having listened to the positive speeches that have been made about Lords amendment 18, I wonder whether it needs more support from either side of the House, but I rise to support it none the less.

As a member of the Scottish Affairs Committee, I welcome the Bill, as amended, and recognise how positive it is that the Government have delivered the additional powers for Holyrood that were promised in the coalition agreement, thereby fulfilling a manifesto commitment of more than one party in the House. As has been said many times—but it bears repeating—the Bill will deliver the largest transfer of fiscal powers to Scotland since the creation of the UK. It has involved a huge amount of work by many people, not least by Ministers at the Scotland Office. I congratulate them on reaching this stage with the Bill and on its being supported by Holyrood and the UK Government without reservation.

I welcome Lords amendment 18, which will facilitate better scrutiny of the implementation of the financial aspects of the Bill. As we all recognise, economic growth driven by enterprise and predominantly by businesses in our local communities will be a key element in the resurgence of this nation. Creating a new Scottish rate of income tax from April 2016 will give the Scottish Government more responsibility not only over how they spend revenue, but over how they raise it. That is a crucial discipline, which we hope will increase the likelihood that fiscal decisions will reflect the needs and priorities of Scotland, the Scottish economy and, most importantly, the businesses of Scotland. This is an opportunity to deliver genuine and innovative fiscal accountability for the people of Scotland. The amendment will further facilitate and enhance that.

I welcome the fairness, transparency and accountability that the amendment will promote, which have been mentioned by a number of Members. It will insert a new clause requiring the Secretary of State to publish a report on the implementation and operation of the financial aspects of the Bill within one year of the Bill becoming an Act, and thereafter to publish an annual report until a year after the tax and borrowing powers are fully transferred to the Scottish Parliament. I welcome the fact that such reports must be laid before both Houses of Parliament and sent to Scottish Ministers, who will have to lay them before the Scottish Parliament, and the joint working and greater co-operation that that process will undoubtedly promote. As has been said, the new clause will require Scottish Ministers to make and lay reports of the same kind before the Scottish Parliament on an annual basis and to provide a copy of each report to the Secretary of State to lay before both Houses of Parliament.

The new clause also sets out the areas that each report must include. That detail is welcome, and I will mention some of the details because, although they have been referred to, they have not been covered as comprehensively as I would like. The reports must include an update on all aspects of progress towards the commencement of provisions on the financial aspects of the Bill since the previous report; detail of any steps towards the commencement that the maker of the report proposes should be taken; an assessment of the operation of the provisions that have been commenced; an assessment of the operation of powers to devolve taxes to the Scottish Parliament or to change the powers of Scottish Ministers to borrow—those borrowing powers are substantial and I will return to them in a moment—or of any other changes to the financial provisions in the Bill; the effect of transferring tax powers on the Scottish block grant; and any other matters concerning sources of revenue for the Scottish Administration that the maker of the report considers should be brought to the attention of the UK or Scottish Parliaments. The sheer width of the areas that will be scrutinised in the report is to be welcomed.

There will be a new £2.2 billion capital borrowing power for the Scottish Parliament from April 2015. A limited version of the power will be in place from April 2013 to enable the Scottish Government to fund £100 million of prepayments for the Forth road crossing, which will allow early work on the bridge to get under way. That will provide an effective boost for the economy across Scotland and the UK.

The other powers that will be introduced and that will be scrutinised include not only the new Scottish rate of income tax, which will be in place from April 2016, but the power to introduce new taxes, subject to the agreement of the UK Government, from the enactment of the Bill, and the full devolution of stamp duty, land tax and landfill tax from April 2015. Those are not token gestures, but substantial changes, as the figures show. Last month, the Office for Budget Responsibility produced a forecast of the sums that will be raised under the Scotland Bill powers in 2015-16. The figures demonstrate the importance of good scrutiny. The sums are great: £5,265 million from income tax, £480 million from stamp duty, £151 million from landfill tax and £49 million from the aggregates levy. They are huge figures by any standards, and it is right that there is year-on-year reporting on them, with scrutiny and accountability. That is why the amendment is so welcome.

The amendment will strengthen democratic accountability, better inform all those involved and the people whom they serve and bolster political engagement in Scottish communities, which is welcome. The amended income tax provision in the Bill will mean that the procedure for setting the Scottish Government’s budget will be more responsive to the wishes of the Scottish electorate, and the additional provisions of Lords amendment 18 will effectively augment the implementation of the change.

The Bill as amended is about improving the devolution settlement and promoting economic growth effectively. The income tax proposals in it retain the reservation of overall fiscal management to the UK Government, but ensure that Scotland’s needs are supported alongside a UK-wide strategy of promoting growth and economic stability for all those in the Union. In welcoming the Bill, the report of the Scottish Parliament’s own Committee stated:

“The Scotland Bill is about good government. It is intended to improve how Scotland is governed and align decisions on spending and taxation more closely so that the Scottish Parliament will be more accountable and, in the long run, take better decisions. Better decisions will, in the longer term, mean improvements to many aspects of Scottish public life.”

I am sure the scrutiny that the amendment will provide—it is good to hear that it is a Government amendment—will indeed furnish those improvements.

Devolution on the basis of the Bill as amended will give Scotland the best of both worlds. It is better off as part of a strong UK when dealing with economic and global security shocks, and the devolution settlement as set down in the Bill will facilitate Scotland in making its own decisions on matters such as health, education, transport and policing. I am therefore pleased that, after careful consideration, the Bill has been supported by both Houses in the UK Parliament, and that it was passed unanimously by the Scottish Parliament just a few days ago following agreement in March between the UK and Scottish Governments on its details. That is an example of the effective joint working that Lords amendment 18 is intended further to promote.

I congratulate the Government on their determination to continue to bring operational effectiveness to the new tax powers in the Bill through joint working over the coming months and years. The Bill is a fair and substantial way of promoting devolution, with the intention of reaching effective implementation. I am sure that Members of all parties will welcome the good intent that the Government are showing towards that effective implementation and joint working on the Bill. I welcome the Bill as amended.

[Pete Wishart]

It is a pleasure to follow the hon. Member for Congleton (Fiona Bruce). The Scottish people are always pleased at the interest and indulgence of English Members of Parliament in our affairs and business. We are all grateful for that.

It is a pity that the hon. Member for Penrith and The Border (Rory Stewart) has left the Chamber. I did not know whether to reach first for my horned helmet or my longboat during his comments about Vikings. I do not know how many people in Denmark are rushing to join a greater union with Germany—certainly I have never come across a Dane who has been keen to be part of that particular union.

The most notable thing about these Lords amendments is how little they were discussed in the Lords. I do not know whether other Members spent any time looking at the debates in the House of Lords, but I did, and “interminable” would not be the word to describe some of them. At times it seemed like the Michael Forsyth show—he was on his feet all the time. Such is his pre-eminent place in the Tory-led cross-Unionist alliance that people like him are leading the debate just now.