Scotland Bill

Debate between Jim Fitzpatrick and Ian Murray

Tuesday 30th June 2015 Commons Chamber

[Ian Murray]

That is right, because the commitment that was given to the Scottish people after the no vote at the referendum last September was that we would create one of the strongest devolved Parliaments in the world. In order to be able to do that, we have to give the necessary tools to the Scottish Parliament to determine not only its own direction in welfare and a host of other policy areas, but the finances it raises to pay for that. Accountability comes with that kind of financial responsibility and that is what, according to Smith, the Scottish Parliament was missing before the Scotland Act 2012 and the Scotland Bill before us today.

The Scottish Parliament needs to be given the ability to make its own decisions. Using terms such as “short-term”, “discretionary” and “on a short-term basis” do not give that flexibility. If someone were putting forward a new system of welfare in Scotland, it would be up to the electorate to decide whether they wanted that and wanted to pay for it.

I now come to arguably the most important amendment to this part of the Bill, new clause 31, which broadens the circumstances under which the Scottish Parliament can create new benefits, and brings it more into line with what I believe the Smith agreement intended. It has been co-signed by SNP Members and for that I am very grateful. Due to its significance we should be able to use it to transform this part of the Bill.

New clause 31 creates a new exception 9 in section F1 in part 2 of schedule 5 to the Scotland Act 1998—I know all Members will have read that and will know exactly what I am referring to—which allows for the creation of any benefit not currently in existence, payable by or on behalf of a UK Minister of the Crown, or otherwise a reserved benefit. In essence, this would allow the Scottish Parliament to create any new benefit which is not in existence on the date on which this Act is passed. This, I believe, goes significantly further than what is currently in the Bill.

I will be grateful if the Minister responds specifically on why this, in his view, would not be desirable or practicable, because it ensures that the power to create new benefits in Scotland rests with the Scottish Parliament and therefore the Scottish people, and that it has the flexibility and autonomy to exercise this power free from unnecessary restraint, in keeping with the spirit and substance of the Smith agreement. Of course, there will have to be joint working between the Governments to ensure that it is deliverable, and that brings me to an important common theme that has run through these Committee debates so far: the need for both Governments to work much closer together in partnership for the benefit of Scotland. We cannot emphasise that enough. We must have a much more solid partnership working and relationship to make these provisions work.

Let me be absolutely clear on this point so that there is no ambiguity: I believe in the fundamental principle that the final say on the creation of new benefits, the type of benefit created, whom it is paid to, and how long and how often it is paid, should reside with the Scottish Parliament. That is my view, and that is the view of the Labour party across the UK.

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

On the exchange my hon. Friend had with the hon. and learned Member for North East Hertfordshire (Sir Oliver Heald) on the impact of the Government policy of cutting tax credits, which will hit people who are in work more than people who are simply on benefits, will these amendments, many of which have the support of the SNP, give any extra protection to the people in Scotland against the impact of cutting tax credits that will happen in England, or not?

[Ian Murray]

New clause 31 allows the Scottish Parliament to top up any reserved benefit in the UK and create any benefit in devolved areas, so there would be an ability to create a system that mitigates the reduction in tax credits. As I understand it, tax credits are not a benefit in terms of the system; they are done through the income tax system, so topping up tax credits would be outwith the scope of this arrangement, but there is no reason why under new clause 31 an additional benefit could not be put in place for people who are in work and have children, for example.

I am very pleased that we have managed to get cross-party support for new clause 31 and if the Government agree it, it would give the Scottish Parliament full autonomy on the welfare state, which I think is what the Scottish people and Scottish Parliament want. If the Government are going to support any amendment, I urge them to make it new clause 31, although I also recommend our other amendments.