Scotland Bill

Ian Murray Excerpts

Monday 15th June 2015 Commons Chamber

[John Redwood]

Then I think we need to have another debate, on another day, which looks at what is going on in these important financial discussions. Although my constituents are interested in what powers Scotland gets, they are far more interested in how the money works between the different parts of the Union. We have no papers before us today to elucidate that.

[Ian Murray (Edinburgh South) (Lab)]

For the second time in five and a bit years, I agree with the right hon. Gentleman. On the complicated nature of the fiscal framework, which I believe he is trying to unpack, does he not agree that the Labour new clause, which will be debated at some point, to set up an independent commission on the costs and implications of full fiscal autonomy provides a much more reasonable and sensible approach?

[John Redwood]

We are where we are. Promises were made, I thought in good faith, by the three Front-Bench teams. They were not my chosen promises; they were made on behalf of the three Unionist parties. They did the job for the referendum, but they then did not do much of a job for the Unionist parties at the general election. However, we cannot now be seen to be delaying for any great length. There needs to be proper work—and I am sure that proper work is going on in the Government at the moment as they try to work out a financial settlement in parallel to this Bill. I am just suggesting that perhaps this Parliament needs to have some of that thinking shared with it.

Today is the first opportunity, within the clear parameters of new clause 3, to try to expose a bit of the thinking on how a limited amount of fiscal autonomy will work, and on how many of these taxes Scotland will not only collect, but be responsible for and have knocked off the block grant. As I remember it, when the leaders came up with this promise, Gordon Brown was a big voice—obviously, he was not one of the leaders at the time—for rather less fiscal autonomy. He was trying to stop Scotland controlling her own income tax revenues, so I do not entirely share the interpretation of the Labour Front-Bench team of what Mr Brown was trying to do at that point.

I will bring my remarks to a close with the simple conclusion that the world has moved on because of the general election result. The debate on money is taking place elsewhere, but we currently have a short debate about money here. I hope that the Front-Bench team will share some of its thoughts on money. Fiscal devolution seems to be attractive to many people in Scotland, but we need to know where it ends and how we sort out all those crucial issues about debt and borrowing as well as about shared policies such as pensions.

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[Stewart Hosie]

I fear that my hon. Friend was intervening less on me than on Conservative Members, but he is absolutely right. There is no argument too odd for them to deploy.

On the opposition to full fiscal autonomy, basing an argument on one or two flawed analyses is using a snapshot in time in order to say no. It is less a case of analysing all the facts to come to a considered view, and more one of finding any reason to oppose for opposition’s sake.

[Ian Murray]

I have tremendous respect for the hon. Gentleman, but he is letting himself down by how he is conducting this debate. If he is saying that the Institute for Fiscal Studies is wrong, why has the same figure come out of the Scottish Government’s own accounts?

[Stewart Hosie]

The chief of the snapshot analyses I have just described is the one from the IFS that our opponents pray in aid. They claimed in April that Scotland would face a relative deficit of £7.6 billion, which may rise to £10 billion by 2019-20, and that in itself is enough for them to say no. I also like and respect the hon. Gentleman—I will not finish the rest of that sentence. I would tell him that his argument is fundamentally flawed. In essence, our opponents’ argument is that even if the IFS figures were true, UK Government economic policy has failed Scotland and we should therefore keep economic policy in the hands of a UK Government who have failed. That simply is not credible.

It is of course true that Scotland has a deficit, and so does the UK—borrowing £75 billion this year, almost four times what the Chancellor promised borrowing would be. The majority of advanced economies run deficits, particularly in difficult times. The UK deficit in 2013-14 was £98 billion. Over the five years to 2013-14, the cumulative deficit was £600 billion. The UK was in deficit for 43 of the past 50 years, and 28 of the 34 members of the OECD were in deficit in 2013. If the deficit alone was a reason for a country to surrender its financial independence, the UK economy would be run from Berlin.

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[Stewart Hosie]

That is absolutely right. Trend growth in the UK over decades has not been sufficient, and private sector investment and innovation have been lamentable. My hon. Friend is absolutely right that we need these powers for a reason.

Notwithstanding what has been said, it is important to remember that Scotland is a prosperous economy. It is about far more than oil, although to listen to some of our political opponents, one would think that that was all the Scottish economy consisted of.

[Ian Murray]

Will the hon. Gentleman enlighten the Committee about what level of economic growth he thinks Scotland would require to balance the budget?

[Stewart Hosie]

We need to get trend growth up and we need to operate within a framework that will see the deficit begin to come down. I do not remember the previous Labour Opposition ever coming up with a cast-iron figure—2.75%, 3%, 3.25%, 4% or 5%—for trend growth. No one would be so silly as to put a figure on it, when it is dependent on so many external criteria.

Our political opponents dismiss the Scottish economy, saying that it is all about oil. They seem to forget that in two of the past four years our deficit was smaller than that of the UK. In the past 34 years, tax revenue per person has been higher than in the UK. Indeed, in the last full year, including our geographic share of the North sea, it was more than £10,000 per head compared with £9,700 in the UK. Even without North sea oil, output per head is almost identical to the UK. We remain the third most prosperous and productive of the 12 so-called regions of the UK, and, including a geographic share of oil and gas, our output per head is higher than the UK average, even today.

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[Ian Murray]

The hon. Gentleman is being incredibly generous with his time. Will he tell the Committee why, if full fiscal autonomy is so good for the Scottish budget, he will not support new clause 3, tabled by the hon. Member for Gainsborough (Sir Edward Leigh)?

[Stewart Hosie]

I want maximum power for Scotland. I want it as quickly as possible. I am not like the British Labour party, which keeps saying no and, in the absence of no, says delay with yet another commission. If the hon. Member for Gainsborough (Sir Edward Leigh) presses new clause 3 to a vote, we will support it. Here is the thing: I hope the hon. Member for Edinburgh South (Ian Murray), who is grinning like a Cheshire cat, will now get to his feet and tell us whether he intends to back the Government tonight in opposing powers for Scotland. The silence is deafening.

Let me continue with more of the arguments our opponents deploy against full fiscal autonomy. When they argue against more powers they say that they would require further cuts, but that argument is completely flawed. It would suggest that the Scottish Government are protected from Westminster cuts at present, which simply is not true. Cuts in the previous Parliament actually took place at a time of rising North sea revenues.

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[Tommy Sheppard]

I am a Derry man as it happens. If the hon. Gentleman wants to make a point of such substance, perhaps he should indicate to the Chair and take part in the debate. What we are talking about is a matter of political principle. It is about the direction in which we want to go forward. It is entirely possible, with good will, to put in place proper fiscal arrangements.

I wish to turn to the amendment of the hon. Member for Gainsborough (Sir Edward Leigh). I have not been in this job long—

[Ian Murray]

rose—

[Tommy Sheppard]

May I deal with this point, and then take an intervention? I have not been in this job long, but I am surprised—I expect I will be surprised by various things over the next five years—to find such a passionate and eloquent exposition from the Conservative Back Benches of a position with which I agree. I suspect that there is little else on which the hon. Gentleman and I would agree. On this point, he makes his case very well. However, I wonder whether there is an element of mischief at the back of his mind. Perhaps he believed the propaganda from his own Front Bench several weeks ago that we were weakening in our commitment to full financial autonomy, and he thought that he might embarrass us in this debate today. I must reassure him that we are not lukewarm and our commitment is not weakening. In fact, we like the idea so much we have brought our own amendment before the Committee. I am intrigued at the suggestion that all we need to do is vote for it—

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[Tommy Sheppard]

If the new clause is moved, the hon. Gentleman will see me there, for sure. I hope that I will see him in the Lobby to vote on our amendment.

The interesting thing about the debate so far is that the case has not been made against full fiscal—

[Ian Murray]

rose—

[Tommy Sheppard]

Is this perhaps on the subject of the hon. Gentleman’s misrepresentation of my views?

[Ian Murray]

I am grateful to the hon. Gentleman, who has just confirmed that he will walk through the Lobby with the hon. Member for Gainsborough (Sir Edward Leigh). He said on the radio—I was on with him—that the delivery of full fiscal autonomy for Scotland would be utterly devastating. Does he stand by those comments?

[Tommy Sheppard]

The hon. Gentleman must apologise for misquoting me. I said—[Interruption.] Yes, I have the transcript as well as the hon. Gentleman. I said in the context of a debate that if this was done wrongly it would be possible to get it wrong. To my mind, that is a tautology: if we do not do something right, we get it wrong. The hon. Gentleman then decided that that somehow meant that I was against the whole principle of full financial autonomy and took to the Twittersphere to promote that. It does not, I am not and the fact that he had to do that shows the paucity of the arguments against our proposals.

We have yet to hear the argument against full financial autonomy for the Scottish Government, and I hope that we shall before the debate concludes. We have heard talk of a black hole, which other people will regard as a deficit when in fact it pertains to all economies at this point in time. We have heard that a policy of principle should be based on a snapshot from one point of time in an academic survey of what might happen in a year that will not even be covered by the process. That has somehow been extrapolated into an argument of principle against the proposal. It is not. If it was, would that mean that if there was not a deficit but a surplus in the Scottish budget, as there has been on many occasions, the policy would be flipped again and autonomy would suddenly become okay? We need to hear the arguments of principle against the proposal.

The difference between us is that, although there is a deficit in the Scottish budget, the SNP believes that it is possible for Scotland to prosper if it has control of its own resources, if it can manage its own economy, if it can grow its own revenue base and if it can steward its own budgets properly. Full financial autonomy would mean that the people of Scotland could get the benefits of that economic growth. That seems a laudable objective.

[Tommy Sheppard]

I am sorry, but I am just coming to the end of my speech.

My hon. Friend the Member for Dundee East (Stewart Hosie) has given some clear examples of how economic powers could be deployed. If Members, many of whom are on the Labour Benches although some might be on the Government Benches, are against that in principle, they need to tell us. If they are against it just because of the economics that might pertain to it, it is entirely possible to make an argument about equalisation measures and other mechanisms that could be introduced if we wanted it to happen. They need to tell us why on principle they do not want it to happen. I hope that we will hear that before the night is out, but in the meantime I commend the amendments to the Committee.

[Ian Murray]

May I personally congratulate the hon. Member for Edinburgh East (Tommy Sheppard) on his stunning victory at the general election? I miss my colleague, Sheila Gilmore, whom I wish well, but I congratulate him.

It is a great pleasure to speak in support of our amendments. I could not help noticing that Lionel Richie was in the Gallery earlier, and I hope he enjoyed the first part of our debate as much as we enjoy his music.

These days in Committee are important in ensuring that the Smith agreement is delivered in full in both spirit and substance, as we said consistently on Second Reading. It is also essential to ensure that we go further than the Smith agreement, as Labour has said time after time, and we have set out a number of clear improvements.

Scotland has had an in-depth and passionate debate about its future and concluded that a fair and more prosperous Scotland is best delivered by shared tax and spending across the UK, with Scotland taking more control over the levels of tax and spending alongside greater accountability. I agree with the hon. Member for Perth and North Perthshire (Pete Wishart) that if anyone is under any illusion that the centre of political gravity in Scotland is not at Holyrood, they have not grasped the modern political landscape in Scotland. That is why the clauses and amendments recognise the Scottish Parliament as the seat of political power and the catalyst for change in Scotland. Our amendments attempt to deliver that change. This is a great responsibility on us all, but in the end it is much more important that we debate how powers are used than where they lie. We have tried to tease out some of those issues in interventions today, but without much success.

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[Mr MacNeil]

At the time of the referendum, the yes side included full fiscal autonomy in its proposals. After the vow, the no side also included full fiscal autonomy. What has changed since the referendum that has made the no side resile from that? The vow was as near to federalism as possible, and it would have included full fiscal autonomy. Why does the hon. Gentleman now want to leave those powers in the hands of the Tories at Westminster rather than with the Parliament of the Scots in Edinburgh?

[Ian Murray]

There is a very simple answer to that question. We all want what is best for Scotland. The latter part of my speech sets out how full fiscal autonomy would be bad for Scotland according to all the information we have. We can either have a sensible debate in this Chamber about our fundamental principles on people’s lives and livelihoods in Scotland, or we can have a political knockabout on who will vote with who, who prefers who and who said what to whom during the referendum debate. The Bill is critical to future livelihoods in Scotland, and if all we can get from those on the SNP Benches is simple party point scoring we will get no further forward in improving the Bill.

To answer the question asked by the hon. Member for Na h-Eileanan an Iar (Mr MacNeil), we are here today because the vow put together the Smith agreement. The five political parties, including the SNP, which was represented on the commission, have come forward with proposals that are now in the Bill. Labour wants to take the Bill a little further. I keep emphasising that and I emphasised it consistently on Second Reading.

[Ian Blackford]

rose—

[Ian Murray]

I am going to make a little progress, but I will come back to the hon. Gentleman if he wants to intervene a little later.

As Labour said at the time of the referendum, and as we have said many times since, the no vote was not a vote for no change. Labour played an active part in the Smith commission, the recommendations of which bring us to where we stand today, considering the Bill. It was a compromise position and with all good compromises there will be some gains and some losses. I hope and believe that the Bill will strike the right balance, affording the Scottish Parliament the power to make a real difference to people’s lives while ensuring that Scotland remains part of and secure in the United Kingdom.

[Mr MacNeil]

Will the hon. Gentleman give way?

[Ian Murray]

I will give way to the hon. Member for Ross, Skye and Lochaber (Ian Blackford), who got in before the hon. Member for Na h-Eileanan an Iar.

[Ian Blackford]

Will the hon. Gentleman not accept that the Scottish people voted overwhelmingly for the Scottish National party in the general election on 7 May? Fifty-six Members of Parliament were sent to this Chamber with the express view of the Scottish people that we want home rule—the home rule that Gordon Brown talked about before the referendum. Why does the hon. Gentleman not accept that Labour lost the general election in Scotland because it was out of tune with the Scottish people? It is about time it started to listen to what the people of Scotland want and to deliver it.

[Ian Murray]

It seems to me that the SNP, in its fantastic victory, on which I have congratulated and complimented its Members on a number of occasions from this Dispatch Box, does not want any scrutiny at all. Just because the SNP has made a proposal for full fiscal autonomy does not mean that we should not scrutinise that proposal. In fact, if it was not for the hon. Member for Gainsborough (Sir Edward Leigh), we probably would not even be discussing full fiscal autonomy today. He forced the hand of the Scottish National party so that it brought forward its manifesto commitment, which it was rowing back on incredibly quickly.

[Stewart Hosie]

Will the hon. Gentleman give way?

[Ian Murray]

Let me make a little progress and then I will give way, as the hon. Gentleman was generous in giving way to me.

In the past couple of years it has become increasingly apparent that devolution is a matter not just for Scotland, Wales and Northern Ireland, but for England and the United Kingdom as a whole. The Labour movement has always been an engine of reform and the party of devolution. People want to see power devolved and exercised at local level, affording greater decision making and enhanced accountability.

[Patricia Gibson]

Will the hon. Gentleman give way?

[Ian Murray]

I will give way, but let me make a little progress first as people want to speak on other amendments.

If those ambitions are to be realised, we need to depart from the divisive rhetoric employed during the general election campaign, which set Scots against the English and against one another and risks tearing the UK apart at the seams. Labour believes in the historic Union of the UK nations working together for the common good. However, it is clear that the Union now needs to evolve, and that evolution means dispersing power from the centre, from Whitehall and from this Parliament. With devolution to Scotland, Wales and Northern Ireland continuing apace, this evolutionary process is in danger of becoming lopsided.

That is why, had Labour won in May, we would immediately have started to devolve power away from Whitehall not just to Scotland, Wales and Northern Ireland, but to the regions and localities across the United Kingdom. That is because we recognise that regions can and must be given more of a voice in our political process, and that we must find new ways to give further voice to regional and national culture and identity, and crucially without the strings that this Government have attached.

[Stewart McDonald]

I am grateful to the hon. Gentleman for giving way and I apologise to my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) for intervening first. The hon. Gentleman makes an important point about taking power out of the hands of this place and of the Scottish Parliament and giving it to local communities. Others on the Labour Benches have made the same point. Why then did Labour-controlled Glasgow city council continue to act as a roadblock against our legislation in the Scottish Parliament? I see him rolling his eyes and chuntering to his mate beside him. Why is Labour against our Bill in the Scottish Parliament to give power to local communities through the Scottish Parliament? Why is Labour such a roadblock in Glasgow?

[Ian Murray]

I am not sure of the entire detail of the proposal that the hon. Gentleman refers to, but there is a general consensus across Scotland that the Scottish Parliament has been one of the most centralist Parliaments in the world by grappling power away from local government. What we are trying to do as part of this Bill, which I think is a major positive, and I hope the Government—

[Stewart Hosie]

Will the hon. Gentleman give way?

[Ian Murray]

Will the hon. Gentleman allow me to answer the previous intervention first? He is a seasoned professional in this Chamber, so he should allow me to get at least halfway through the response to his hon. Friend’s intervention.

One of the key questions—I hope the Secretary of State and those on the Treasury Bench look at some of these principles in the context of the Bill—is whether those principles go further towards double devolution. There is no point in sending powers from one Parliament to another. [Hon. Members: “Give way!”] Those powers also have to be spread across Scotland from Holyrood to local authorities. Without that process, hon. Members cannot take power closer to the people they seek to represent.

I will give way to the hon. Member for Dundee East (Stewart Hosie) and then to the hon. Member for North Ayrshire and Arran (Patricia Gibson). [Interruption.] The hon. Lady can blame her boss if she likes; he wants to come in first.

[Stewart Hosie]

The hon. Gentleman suggested about 10 minutes ago that the Scottish National party was not going to table an amendment to deliver full fiscal autonomy, and he suggested that it happened only because of the amendment tabled by the hon. Member for Gainsborough (Sir Edward Leigh). That is completely false. Amendment 89 is on the amendment paper to deliver full fiscal autonomy. Will the hon. Gentleman withdraw that daft allegation from the Labour Front Bench and, more importantly, confirm that Labour Members intend to go through the Lobby with members of the Tory Front-Bench team to stop power coming to Scotland?

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[Ian Murray]

It is wonderful. We are now being accused of voting not with the Tories, but with the Tory Front Bench, while SNP Members troop through the Lobby with the most right-wing Conservatives. It is incredible. The hon. Gentleman is not listening to the answer, although he insisted on the intervention. If he was so keen on full fiscal autonomy before he tabled amendment 89, he could have just signed new clause 3, tabled by the hon. Member for Gainsborough.

[Sir Edward Leigh]

My amendment gives what SNP Members say they want straight away, whereas their amendment is a bit of a fudge and slightly kicks the matter into the long grass. It is a bit like St Augustine saying, “Let me stop sinning, but not quite yet.”

[Ian Murray]

The SNP position can be summed up with the words, “What do we want? Full fiscal autonomy. When do we want it? We’re not quite sure.”

[Patricia Gibson]

Does the hon. Gentleman agree that the powers proposed in the Smith commission report and in the Bill are utterly inadequate? By way of illustration, the powers of the Scottish Parliament are so feeble that it cannot even ban parking on pavements, such is its lack of teeth. Further, does the hon. Gentleman agree that all power should be devolved to Scotland unless there is a compelling reason to reserve that power at Westminster?

[Ian Murray]

The hon. Lady is right: there is a deficiency in respect of parking on pavements and all hon. Members have been lobbied about trying to change that in the Bill. We will table amendments, which she is welcome to sign.

[Patricia Gibson]

rose—

[Ian Murray]

Let me give this commitment: if the hon. Lady brings forward an amendment on parking on pavements, we will sign it.

Let me explain why we tabled new clause 2 in terms of the constitutional convention and the practical steps we need to take so that, where appropriate and desirable, decisions are taken as close to communities as possible. Our new clause proposes that members of the constitutional convention must include members of the public, which is the key part of any constitutional convention, elected representatives across all levels of government, including this place and local government, representatives of civic society organisations and, in an advisory role, academia. What we cannot have is a Prime Minister and Government cooking up a devolution settlement in a back room of the Cabinet Office without proper recourse to the public. As I said on Second Reading, the Prime Minister’s cack-handed approach to the way he dealt with the post-Scottish referendum landscape has in itself threatened the very viability of the UK that Scots voted to maintain.

Let us have a wide-ranging discussion on the constitutional settlement of the whole of the UK. The recommendations by the constitutional committee would include, but not be restricted to, matters that we have already discussed today—the role and voting rights of Members in this Chamber, democratic reform of the House of Lords, further sub-national devolution to England, Wales, Northern Ireland and Scotland, votes at 16 and codification of the constitution, the absence of a proper written constitution being one of the problems we have when discussing the Bill.

Our amendment 37 and 38 are very similar in substance to those tabled by the right hon. Member for Orkney and Shetland (Mr Carmichael). The opening lines of the vow declared that

“The Scottish parliament is permanent and extensive new powers of the Parliament will be delivered”.

Equally, the Smith commission agreement said that

“UK legislation will state that the Scottish Parliament and the Scottish Government are permanent institutions”.

As I have said, the centre of political power in Scotland is the Scottish Parliament. It has powers over most things that affect the day-to-day lives of most Scots, but as things stand and as was noted by the Political and Constitutional Reform Committee, the Scotland Act 1998 stated:

“There shall be a Scottish Parliament”,

but did not provide that it be permanent, nor does it set out any special procedures or grounds on which it could be dissolved. Would there be a simple repeal of the Scotland Act?

There has been agreement among legal experts that the clause could be made clearer, more concise and more in keeping with the overall spirit and tenor of the Smith recommendations. For example, the Law Society of Scotland—I thank it and particularly Michael Clancy for all his advice on the legalities of these clauses—stated:

“The phrasing in the draft clause does not literally implement the terms of Paragraph 21 of the Smith Report. The use of the phrase ‘recognised as’ permanent has a different nuance from a statement that the Scottish Parliament and the Scottish Government are permanent institutions.”

[Patrick Grady (Glasgow North) (SNP)]

Given that the Scottish Parliament, at the insistence of the Labour party, was founded through the process of a referendum, will the hon. Gentleman support our clause to ensure that it cannot be abolished without a referendum?

[Ian Murray]

I am delighted that the hon. Gentleman has raised that point. That is exactly what our amendment does as well. We are very happy for SNP Members to sign our amendment, given that ours was tabled before theirs. We agree on this; there is no division on this. We need a robust devolution architecture. That means making sure that the legal restrictions in the Bill are removed so that we have a permanent Scottish Parliament in statute as well as in spirit.

Amendment 16 would alter clause 1 by exchanging the indefinite article for the definite article in reference to the Scottish Parliament. There is only one Scottish Parliament, after all, so there is no need for a double reference. Amendment 38 would add to clause 1 the stipulation that the Scottish Parliament and the Act on which it is predicated can be abrogated only with the consent of the Scottish people given effect by an Act of the Scottish Parliament. That is the referendum section of our amendment. I believe that amounts to what is known in constitutional law as contingent entrenchment. Given the limited time available, I will not go through the other issues relating to contingent entrenchment, but I am sure that the Secretary of State realises the desire of all three opposition parties to strengthen clause 1 and include a referendum requirement so that permanency is determined by the Scottish people. Amendments 58 and 59 make similar proposals.

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[Ian Paisley]

At the end of this debate, has the shadow Secretary of State any inkling whatsoever of when the Barnett formula calculations for Scotland would cease and what impact that would have on the rest of the United Kingdom?

[Ian Murray]

The Barnett formula would cease as soon as the powers for full fiscal autonomy were transferred. That is something everyone should be aware of. The hon. Gentleman has consistently challenged SNP Members to say what the cost of full fiscal autonomy would be for the ordinary Scottish person in the street, and we are yet to have an answer. We have been told, “Let’s get the principle of full fiscal autonomy together and then work out the consequences later.”

[Several hon. Members]

rose—

[Ian Murray]

I will give way again, but first let me make some progress.

It is simple: the pooling and sharing of resources across the UK, and the maintenance of the Barnett formula, benefits Scotland. The much-quoted Institute for Fiscal Studies, which the SNP continually rubbishes, has demonstrated beyond argument that full fiscal autonomy would result in Scotland having a deficit of some £7.6 billion. Before SNP Members jump up to challenge those expert figures, I want to put it on the record that that is over and above any current UK deficit and UK spending projections.

[Joanna Cherry (Edinburgh South West) (SNP)]

Does the hon. Gentleman agree that all this talk of black holes with full fiscal autonomy fails to recognise that a black hole exists already as a result of the policies of successive Westminster Governments, both Tory and Labour, and for which the Tories are now making the poorest and most vulnerable in our society pay? [Hon. Members: “Speech.”] The case that Labour is making in attacking full fiscal autonomy is that things are so bad that letting the Tories fix the deficit their way is better—[Interruption.] I am going to keep going—[Interruption.]

[Joanna Cherry]

Does the hon. Gentleman agree that his party should have more ambition for Scotland?

[Ian Murray]

This is the nub of the matter: if we try to scrutinise what would be a devastating policy for Scotland, we are accused of not being ambitious for Scotland. For the avoidance of doubt, that £7.6 billion is over and above the UK deficit. I agree with the hon. Lady that the Conservative Government made a complete shambles of getting rid of the deficit in the previous Parliament, breaking all their promises and only halving it. But the actual deficit—I have the IFS paper here—is not just £7.6 billion, but £7.6 billion over and above the current UK deficit, which is £14.2 billion. That is not a lack of ambition for Scotland, but a warning against a fiscal policy that would be folly for families up and down Scotland.

[Mr MacNeil]

rose—

[Ian Murray]

I will give way to the hon. Gentleman, before he bursts a blood vessel.

[Mr MacNeil]

It is now clear that the policy of Labour’s Front Benchers is to leave Scotland’s tax powers in the hands of this Tory Government. The vow did not say that; the vow included full fiscal autonomy. Will the hon. Gentleman tell us when he changed his mind?

[Ian Murray]

The Bill before us will transfer nearly 50% of tax and 60% of spending to the Scottish Parliament. We promised to make it the most powerful devolved Parliament in the world, and that is a promise we will keep. As I have always said, we will ensure that the Bill is delivered in full, both in spirit and in substance. We will go further, as we will debate in Committee in due course.

Let me return to the £7.6 billion deficit—[Interruption.] I know that SNP Members do not like to talk about the £7.6 billion deficit, but it is important to get it on the record. It is unfortunate that they have consistently misquoted the figures from the Institute for Fiscal Studies, and indeed it has had to ask them to retract what they have said about its figures.

We have also heard no mention of the Office for Budget Responsibility’s oil report, which was published last week. It showed that the reliance on oil as an underpinning of the Scottish economy is no longer a viable projection. The collapse of revenues from oil will see the tax take from that source drop from £37 billion to just £2 billion over the 20-year period to 2040. That would be catastrophic for Scottish public finances. The question, then, is this: will SNP Members vote with the Tories to deliver what they want, as they have said they will do, or will they finally admit that their flagship policy of full fiscal autonomy is economically illiterate?

[Stewart Hosie]

rose—

[Ian Murray]

And there is no better time to go to the hon. Member for Dundee East.

[Stewart Hosie]

The hon. Gentleman is extremely generous. He mentioned the OBR. He will want to confirm, for the sake of completeness, that the OBR itself has said that the forecasts were very uncertain, even over the short term. It implies 8 billion barrels of oil extracted, rather than the normal industry 14 billion to 24 billion, and of course the figures it uses are contradicted by other expert groups that have higher prices and higher forecast extraction figures.

[Ian Murray]

Well, the hon. Gentleman is wasted in this House; he should be in the City, buying and selling futures in oil price shares. I think that is the best way for him to go. The three points that fall from the OBR report are the unpredictability of the oil price, the difficulty of extraction in the North sea and the fact that, whatever way we look at it, oil revenues will be declining sharply over the next 20-year period. It would appear that the hon. Gentleman—[Interruption.] I am happy to take other interventions, but it is quite clear that SNP Members cannot defend their policy for full fiscal autonomy. Indeed, they should listen to their hon. Friend, the hon. Member for East Lothian (George Kerevan), who said that it would be economic suicide. He is an experienced journalist and economist, so they would do well to listen to him.

In conclusion, we will push amendment 38 to the vote because we feel that the permanency of the Scottish Parliament should have the underpinning of the Scottish people by any means that would be appropriate, including a referendum. We will push to a vote new clause 2, which proposes a constitutional convention to resolve some of the larger issues on a constitutional settlement across the country. We will oppose full fiscal autonomy in all its forms, because it would be bad for the Scottish people, bad for the Scottish economy and bad for the future of Scotland.

[David Mundell]

Today is the first of four days in Committee on the Scotland Bill. I assure the hon. Member for Edinburgh East (Tommy Sheppard), whose contribution I enjoyed, that I will be listening and reflecting. Contrary to the suggestion made by the hon. Member for Perth and North Perthshire (Pete Wishart), this is not the only opportunity for changes to be made to the Bill. I will be meeting the Devolution (Further Powers) Committee of the Scottish Parliament next week to discuss points that it has raised in its report.

I would not normally begin a contribution by suggesting that anyone read one of Gordon Brown’s books, but tonight I will do so. Gordon Brown has been misquoted a number of times in the Chamber today, and it is important to put on the record the fact that in his book “My Scotland, Our Britain: A Future Worth Sharing”, he states that neither his proposals nor those of any of the pro-UK parties involved a federal solution. Although they came close to the idea of home rule, they were not home rule. Therefore, it is a myth, which has been perpetuated this evening, that Gordon Brown has called for either federalism or home rule.

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[The Parliamentary Secretary, Cabinet Office (John Penrose)]

I thank the hon. Members for Moray (Angus Robertson), for Nottingham North (Mr Allen), and for Caerphilly (Wayne David) for their contributions to the debate on this group of amendments on the significant electoral powers that will be transferred to the Scottish Parliament and Scottish Government. I hope to respond to as many points as I can, but first let me deal with a number of minor and technical Government amendments before I get on to the meat of the points that have been made during the debate.

Government amendments 93, 94 and 97 amend and clarify the reserved undevolved powers in clause 3 in respect of enforcement provisions within the Political Parties, Elections and Referendums Act 2000 where they apply to other provisions that are also reserved. Government amendments 95 and 96 remove sections that do not need to be reserved in the 2000 Act as well. Amendments 106 and 107 are minor and technical amendments. Amendment 106 repeals the subsections inserted into the Scotland Act 1998 by section 13 of the Scotland Act 2012. Clause 11 brings the function of making an Order in Council under sections 15(1) and (2) of the 1998 Act within devolved competence and those subsections are therefore no longer required. Amendment 107 repeals section 13 of the Scotland Act 2012 entirely.

Amendment 101 relates to clause 5, which concerns the timing of Scottish parliamentary elections and local government elections in Scotland. It will ensure that general elections for the Scottish Parliament cannot be held on the same day as general elections to the UK Parliament or to the European Parliament or a local government election in Scotland. That is in line with the Smith commission agreement, as we heard from the hon. Member for Moray.

I hope that the hon. Gentleman will be pleased to hear that the purpose of amendment 101 is to remove the provision from the clause that says that a general election to the Scottish Parliament cannot be held in the two months preceding a general election to the UK Parliament or a general election to the European Parliament. That brings us more closely in line with the Smith commission, and is, I hope, an example of cross-party working.

Amendments 92 and 98 are also minor and technical. The purpose of amendment 92 is to protect the individual electoral registration digital service from future technical changes, such as the transfer of functions between UK Ministers. Effectively, it is nothing more than a future-proofing move. If amendment 92 were not made, the effect may be to place an unintentional constraint on the future actions of both the UK and Scottish Governments. The amendment should protect against the potential need to amend the Act as the registration of electors and verification of applications to register via a digital service evolves.

Amendment 92 means that the definition of “digital service” and of “elections in Scotland” in clause 3 is no longer required. Amendment 98 therefore removes those definitions. It does not make the reservation any wider but gives additional clarity over what is to remain reserved—I am talking about the digital service itself but not the powers that have been devolved to the Scottish Parliament.

Amendments 99 and 100 are again minor and technical. Their purpose is to reflect the changes made to the reservation of the IER digital service in clause 3 by amendment 92. Amendment 99 ensures that subsection (4) of new section 12 of the Scotland Act 1998 refers to the amended reservation of the digital service in clause 3—I trust that everybody is taking notes and following closely. Amendment 100 removes the now unnecessary definition of the digital service in clause 4, again as a result of the amended reservation of the digital service in clause 3.

Amendments 102 to 105 are technical amendments that reflect the changes made to the reservation of the IER digital service in clause 3 by amendment 92. Amendment 102 ensures that the regulation-making power of Scottish Ministers in this provision refers to the amended reservation of the digital service in clause 3. Amendment 103 removes the definitions of “the digital service” and “the use of the digital service” from the clause, as they are no longer technically required. Amendment 104 ensures that clause 6 refers to the amended reservation of the digital service, as made by the amendment to clause 3. Finally, amendment 105 removes the definitions of “the digital service” and “elections in Scotland” that are also no longer required as a result of that further amendment.

Let me turn to the other amendments that are part of this wider group. I will start with amendment 42 and the elements of amendments 60 and 61 that relate to clauses 3 and 5 and the continued reservation of certain combinations of polls. The clauses fulfil the Smith commission agreement devolving significant electoral powers to the Scottish Parliament while ensuring that polls for Scottish parliamentary general elections will not be held on the same day as UK parliamentary general elections, European parliamentary general elections or ordinary local government elections in Scotland, which have already been devolved.

[Ian Murray]

Will the Minister explain why the entirety of the administration of Scottish parliamentary and local government elections is devolved to the Scottish Parliament while the UK Parliament reserves the right not to have Scottish parliamentary and local government elections on the same day? Why not devolve them all to allow the Scottish Parliament to make that decision?

[John Penrose]

That is a question I asked myself a short while ago. The reason is very straightforward. Although the two powers are devolved, as the hon. Gentleman rightly points out, changing the rules surrounding them and on whether or not they can happen on the same day is a reserved power. As that is a reserved power, it makes sense to keep any potential combination of elections as a reserved power for the time being, as the two powers match up. Were it to be within the competence of the Scottish Parliament to vary that, it would make sense for the Scottish Government to have the power to adjust the combination rules. As it is, the two match up closely.

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[Dr Coffey]

To be clear, that is what was agreed in the Smith commission. The right hon. Gentleman’s party agreed to it and we are not planning to go beyond the Smith commission on this particular arrangement.

[Ian Murray]

I did not want the moment to pass without congratulating the hon. Lady on her first time at the Dispatch Box and saying that we are delighted to see her.

[Dr Coffey]

Well, that is very sweet. The hon. Gentleman and I, in our very first summer here together as Members of Parliament, had the joy of going to the United States of America to participate in the British-American parliamentary group. We have been firm friends since. [Hon. Members: “Ooh!”] Exactly—what goes on in Vegas, stays in Vegas.

Clause 10 implements paragraph 27 of the Smith commission agreement, which identified that it is important to have an adequate check on certain types of Scottish Parliament electoral legislation. The Smith commission recommended that UK legislation should provide that such legislation is passed by a two-thirds majority of the Scottish Parliament. The Government agree that this provides an important safeguard. It is possible, of course, that there may be discussions on whether a particular Bill is in fact this type of legislation.

Clause 10 also allows the Advocate General, the Lord Advocate or the Attorney General to refer to the Supreme Court the question of whether a certain piece of legislation requires a two-thirds majority of the Scottish Parliament. The Supreme Court already provides a similar role on whether a particular matter is within the legislative competence of the Scottish Parliament, so I will move that clause 10 stand part of the Bill.

Amendments 67 to 88 concern clause 11, which delivers on the Smith commission recommendation to give the Scottish Parliament greater powers in relation to the arrangements and operation of the Scottish Parliament and the Scottish Government. It does this by enabling the Scottish Parliament to modify relevant sections of the Scotland Act 1998. I am sure that the Secretary of State will wish to reflect on this to ensure that the agreed powers work correctly, but the Government are clear that the substantial new powers devolved under clause 11 are the right ones.

A number of the amendments to clause 11 would allow further modification of the 1998 Act beyond the scope of the transfer of powers envisaged by the Smith commission. The Bill already transfers substantial powers to modify the Act, consistent with the commission, and the Government do not believe it is right to go beyond that.

The hon. and learned Member for Edinburgh South West referred in particular to amendment 67. Indeed, the right hon. Member for Orkney and Shetland said that this matter should be consistent across the UK, reinforcing that this is a reserved for the UK Parliament and not a devolved matter. The hon. and learned Lady said that the UK Government had not been clear on some aspects of this matter. I believe that the Prime Minister has been clear at this Dispatch Box. Amendment 67 would amend the Bill such that paragraph 1 of schedule 4 to the 1998 Act would be modified to remove the Human Rights Act 1998 from the list of legislation the Scottish Parliament cannot modify, otherwise known as the “protected enactments”.

The Committee will be aware that the Government outlined their proposal to reform and modernise our human rights framework by replacing the Human Rights Act with a Bill of Rights. That was reinforced today by my right hon. Friend the Prime Minister at the celebration of the 800th anniversary of Magna Carta. Of course, we are aware of the possible devolution implications of reform and we can engage with the devolved Administrations as we develop the proposals. As the Secretary of State said, the Sewel convention, as intended by Lord Sewel, has been placed in the Bill, but this Parliament remains sovereign. The Government are certainly committed to human rights and, as I indicated earlier, we will consider the devolution implications.