Chamber
Meeting of the Parliament 18 April 2012
18 Apr 2012 · S4 · Meeting of the Parliament
Item of business
Scotland Bill
Like James Kelly, I commend Linda Fabiani for her convenership of the Scotland Bill Committee. I very much enjoyed my participation in it, as I enjoyed my participation in its predecessor in the previous session of Parliament.
The legislative consent motion that the Scottish Government has lodged can be viewed as a humiliating climbdown or a tactical retreat. Perhaps it is a mixture of both. When one looks back on the heady days of last summer and reflects on the rhetoric of the First Minister and his so-called six demands, there is no doubt that people unaccustomed to humility should now be eating a large slice of humble pie.
The six demands were, in some cases, matters that were already works in progress following the recommendations of the previous Scotland Bill Committee, for example in relation to borrowing powers and devolution of certain aspects of the property rights of the Crown Estate in Scotland. The broadcasting proposition was of little substance, and the demand that a Scottish minister should be able to bagsy a seat at all meetings of the Council of the European Union, as part of a UK delegation—even when the European Union did not provide enough seats in the first place—was clearly nonsense.
As all the evidence showed, fellow EU member states see plenty of Mr Lochhead and other Scottish ministers at relevant Council meetings. The key to successful representation of UK and Scottish interests is effective co-ordination and preparation by the UK Government and all our devolved Administrations, well in advance.
The big-ticket items in the six demands were the two tax demands. First of those was the devolution of corporation tax. However, after the production of a paper that argued that a three-point cut in corporation tax could generate a modest number of jobs over an inordinate length of time and a minuscule increase in the Scottish growth rate—all contentious propositions—the bigger-picture scheme for a new corporation tax system for Scotland in the devolved settlement has simply petered out, in the midst of total failure to address all the problematic areas of profit shifting, brass plating and cannibalisation of the tax base, which would benefit no one except the tax-dodging multinational companies of which the SNP is so fond.
Members will recall that another key demand was for control over excise duties. The most telling lessons can be learned from what happened in that regard. The demand was subsequently refined to cover only alcohol but, when industry experts such as the Scotch Whisky Association pointed out that we cannot have different excise duty rates north and south of the border without establishing customs posts to police the tax border, the SNP sounded yet another retreat. The SNP said that excise duties and alcohol were no longer to be devolved, but we should simply get more money because it was estimated that we pay more in duty in the first place—although of course if the minimum pricing policy works there will be less revenue, rather than more, in the long term.
The issue is significant. Although the concept of independence is becoming lighter and lighter by the week, it still has at its heart the establishment of an independent country and in that respect differs fundamentally from other models of devolution, which proceed on the basis that we should be part of the UK but have greater fiscal powers than we currently have. It is clear that under the so-called devo max option we would have full fiscal powers and we would stump up for our share of the costs of NATO and the British nuclear deterrent. Even under the more limited devo plus scheme, the Scottish Parliament would have responsibility for all excise duties.
When it came down to it in the context of the Scotland Bill, however, even the SNP was unable to produce a scheme for the devolution of excise duties on alcohol that was workable on a UK basis, for the simple reason that excise duties are levied and collected at the point of production or importation and not at the point of sale, and are quite different from a sales tax or VAT. Given that the devolution of excise duties on not just alcohol but other subjects, which amount to nearly £5 billion of revenue, is a key principle of so-called devo plus, the proposition seems to contain a major flaw at the outset.
I am genuinely pleased that the motion will be approved by the Parliament, because it demonstrates exactly the sort of process whereby constitutional change within the UK should be enacted by the collaborative efforts of all parties—the use of a commission or convention, engagement with civic Scotland and, ultimately and however reluctantly, the participation of a hostile party that is opposed to the very concept of a UK.
The history of the Scotland Bill and this Parliament’s consideration of it, over two parliamentary sessions and by two separate committees, demonstrates that there is a fundamental difference between the concepts of devolution and independence. The Scotland Bill is there to strengthen devolution in a UK context and makes no apology for doing so.
The SNP cares nothing for our partnership in the UK. Consequently, the latest Scotland Bill Committee majority report duly recommended that everything and a’thing be devolved, even in instances in which not a shred of evidence was submitted to justify such a proposition. That shows the incompatibilities that will continue to exist until we resolve the basic question of independence on the one hand or remaining in the United Kingdom on the other. That is why we need a clear-cut question in a referendum—and, frankly, the sooner that is, the better.
16:00
The legislative consent motion that the Scottish Government has lodged can be viewed as a humiliating climbdown or a tactical retreat. Perhaps it is a mixture of both. When one looks back on the heady days of last summer and reflects on the rhetoric of the First Minister and his so-called six demands, there is no doubt that people unaccustomed to humility should now be eating a large slice of humble pie.
The six demands were, in some cases, matters that were already works in progress following the recommendations of the previous Scotland Bill Committee, for example in relation to borrowing powers and devolution of certain aspects of the property rights of the Crown Estate in Scotland. The broadcasting proposition was of little substance, and the demand that a Scottish minister should be able to bagsy a seat at all meetings of the Council of the European Union, as part of a UK delegation—even when the European Union did not provide enough seats in the first place—was clearly nonsense.
As all the evidence showed, fellow EU member states see plenty of Mr Lochhead and other Scottish ministers at relevant Council meetings. The key to successful representation of UK and Scottish interests is effective co-ordination and preparation by the UK Government and all our devolved Administrations, well in advance.
The big-ticket items in the six demands were the two tax demands. First of those was the devolution of corporation tax. However, after the production of a paper that argued that a three-point cut in corporation tax could generate a modest number of jobs over an inordinate length of time and a minuscule increase in the Scottish growth rate—all contentious propositions—the bigger-picture scheme for a new corporation tax system for Scotland in the devolved settlement has simply petered out, in the midst of total failure to address all the problematic areas of profit shifting, brass plating and cannibalisation of the tax base, which would benefit no one except the tax-dodging multinational companies of which the SNP is so fond.
Members will recall that another key demand was for control over excise duties. The most telling lessons can be learned from what happened in that regard. The demand was subsequently refined to cover only alcohol but, when industry experts such as the Scotch Whisky Association pointed out that we cannot have different excise duty rates north and south of the border without establishing customs posts to police the tax border, the SNP sounded yet another retreat. The SNP said that excise duties and alcohol were no longer to be devolved, but we should simply get more money because it was estimated that we pay more in duty in the first place—although of course if the minimum pricing policy works there will be less revenue, rather than more, in the long term.
The issue is significant. Although the concept of independence is becoming lighter and lighter by the week, it still has at its heart the establishment of an independent country and in that respect differs fundamentally from other models of devolution, which proceed on the basis that we should be part of the UK but have greater fiscal powers than we currently have. It is clear that under the so-called devo max option we would have full fiscal powers and we would stump up for our share of the costs of NATO and the British nuclear deterrent. Even under the more limited devo plus scheme, the Scottish Parliament would have responsibility for all excise duties.
When it came down to it in the context of the Scotland Bill, however, even the SNP was unable to produce a scheme for the devolution of excise duties on alcohol that was workable on a UK basis, for the simple reason that excise duties are levied and collected at the point of production or importation and not at the point of sale, and are quite different from a sales tax or VAT. Given that the devolution of excise duties on not just alcohol but other subjects, which amount to nearly £5 billion of revenue, is a key principle of so-called devo plus, the proposition seems to contain a major flaw at the outset.
I am genuinely pleased that the motion will be approved by the Parliament, because it demonstrates exactly the sort of process whereby constitutional change within the UK should be enacted by the collaborative efforts of all parties—the use of a commission or convention, engagement with civic Scotland and, ultimately and however reluctantly, the participation of a hostile party that is opposed to the very concept of a UK.
The history of the Scotland Bill and this Parliament’s consideration of it, over two parliamentary sessions and by two separate committees, demonstrates that there is a fundamental difference between the concepts of devolution and independence. The Scotland Bill is there to strengthen devolution in a UK context and makes no apology for doing so.
The SNP cares nothing for our partnership in the UK. Consequently, the latest Scotland Bill Committee majority report duly recommended that everything and a’thing be devolved, even in instances in which not a shred of evidence was submitted to justify such a proposition. That shows the incompatibilities that will continue to exist until we resolve the basic question of independence on the one hand or remaining in the United Kingdom on the other. That is why we need a clear-cut question in a referendum—and, frankly, the sooner that is, the better.
16:00
In the same item of business
The Deputy Presiding Officer (John Scott)
Con
The next item of business is a debate on motion S4M-02625, in the name of Bruce Crawford, on the Scotland Bill, which is United Kingdom legislation. I invite...
The Cabinet Secretary for Parliamentary Business and Government Strategy (Bruce Crawford)
SNP
The Scottish Government is today inviting the Parliament to consent to the Scotland Bill, which was introduced into the UK Parliament on 30 November 2010. Th...
James Kelly (Rutherglen) (Lab)
Lab
Can the cabinet secretary remind us of the six proposals that the Government made after the last election and tell us how many of them have been included in ...
Bruce Crawford
SNP
Every party in the chamber has publicly said that Scotland should be granted more powers than are currently in the bill. However, we live in pretty strange t...
David McLetchie (Lothian) (Con)
Con
How many proposals?
Bruce Crawford
SNP
I have just dealt with that point. Those proposals included a role for this Parliament in commencing the finance provisions of the bill as well as the remova...
The Cabinet Secretary for Education and Lifelong Learning (Michael Russell)
SNP
Nae point.
Bruce Crawford
SNP
Yes, there is nae point.Following negotiations between the Governments, a number of legislative and non-legislative measures have now been agreed to improve ...
Willie Rennie (Mid Scotland and Fife) (LD)
LD
The minister did not mention alcohol duty. Is that because he is embarrassed by the fact that he did not present the proposals until after the committee had ...
Bruce Crawford
SNP
I will take no lectures from anybody who is associated with the UK Government on issues to do with alcohol. The member is following us everywhere as far as t...
James Kelly (Rutherglen) (Lab)
Lab
I welcome the opportunity to take part in this afternoon’s debate on the Scotland Bill. I confirm that the Labour Party will support the motion at decision t...
John Mason (Glasgow Shettleston) (SNP)
SNP
Mr Kelly talks about more responsibility, but does he believe that the bill provides the right level of responsibility, or does he think that we should have ...
James Kelly
Lab
What struck me from our discussions in the Scotland Bill Committee on having more powers over income tax and how that would operate is that, as the SNP gets ...
Bruce Crawford
SNP
Given what he says, will the member explain how, in Stirling Council, in my constituency, the Labour Party, in conjunction with the Tories, was able to put f...
James Kelly
Lab
Make no mistake, Mr Crawford—the SNP Government is passing on £658 million of cuts to local councils. We will remind the SNP of that from now until polling d...
David McLetchie (Lothian) (Con)
Con
Like James Kelly, I commend Linda Fabiani for her convenership of the Scotland Bill Committee. I very much enjoyed my participation in it, as I enjoyed my pa...
Linda Fabiani (East Kilbride) (SNP)
SNP
It is interesting that we have just heard two representatives of the anti-independence parties, but they have not said anything yet about what they would wis...
Willie Rennie
LD
I note all the things that the member has said, but I think that she fails to understand the point. We made a submission to the commission as part of a proce...
Linda Fabiani
SNP
Can I presume that it is the same with broadcasting—the Lib Dem Steel commission wanted greater accountability for that—and excise duty? In the Lib Dem submi...
Neil Findlay (Lothian) (Lab)
Lab
The Calman commission was established by the then Labour leader Wendy Alexander prior to the 2011 election, and the subsequent Scotland Bill that emerged fro...
Joan McAlpine (South Scotland) (SNP)
SNP
Will the member take an intervention?
Neil Findlay
Lab
Not at the moment.I state openly that I hope that the Scotland Bill will enable a move forward to genuinely progressive taxation that seeks to redistribute t...
Joan McAlpine
SNP
Will the member take an intervention now?
Neil Findlay
Lab
I will not take one now, because you are mentioned later in my speech, so you will probably want to come in then.The First Minister wanted powers over excise...
Joan McAlpine
SNP
You expressed your concern about welfare. I think that this Parliament is united—certainly Labour and the SNP are united—in agreement that the welfare change...
The Deputy Presiding Officer (Elaine Smith)
Lab
I remind all members to speak through the chair.
Neil Findlay
Lab
I do not think that you are in a very strong position to argue over what you want in the Scotland Bill, since you did not want it in the first place.Of cours...
Linda Fabiani
SNP
Will the member give way?
Nigel Don (Angus North and Mearns) (SNP)
SNP
Will the member give way?
Neil Findlay
Lab
No, thank you.We should not be surprised by the SNP’s budget day backtrack—not just on this bill, but on everything else that it wanted to ditch. Saying one ...