Full Fiscal Autonomy Rejection

John Swinney says he'll press the UK government for substantial and serious discussions to introduce full fiscal autonomy.

The Scottish Government wants Holyrood to have full control over taxation, including oil and gas revenues.

However, Scottish Secretary David Mundell has confirmed the SNP proposals will be rejected, describing them as a 'full fiscal shambles'.

The IFS recently revealed that full fiscal autonomy would create a £7 billion blackhole in Scotland's finances.

Mr Mundell also claims the move would cost every Scottish family approximately £5, 000.

Deputy First Minister John Swinney has written to the Secretary of State to outline priority areas for further devolution which include:

• corporation tax, capital gains tax, the minimum wage and National Insurance
• employment policy and law, including the transfer of employment support programmes, Jobcentre Plus and laws on trades unions and health and safety
• working age benefits and benefits relating to children
• equal opportunities and equality legislation.

Mr Swinney said: “As a minimum, the Scotland Bill must deliver the spirit and letter of the Smith Agreement in full and we will continue to hold the UK Government account to ensure that happens.

“However, we have always said that the recommendations did not go far enough and fall short of a coherent package of powers to help us grow the economy and lift people out of poverty.

“The Scottish Government believes we should move towards Full Fiscal Autonomy as the best route to fulfil Scotland’s potential. The proposals we are publishing today show how we could do that, and set out a range of other priorities, short of full fiscal autonomy, that would make a real difference to Scotland’s economy and people.

“Control of business taxes and the minimum wage would boost economic growth by allowing us to provide targeted business incentives in line with Scotland’s competitive strengths and performance. These measures could boost entrepreneurship, encourage innovation and improve productivity, while tackling in-work poverty and investing in skills.

“Responsibility for employment law would help deliver our Fair Work agenda and strengthen our partnership with business and the Trade Unions, while power over employment support programmes and Job Centre Plus could deliver an integrated service, joined up with existing education and training services, for people needing support.”

“There is also a real advantage to devolving working age and child benefits as it would allow us to design a better, more coherent system that fits with existing Scottish services and our radical approach to preventative spending and early intervention.

“Control over equality would help us create a fairer society by making equal pay law more effective to tackle the gender pay gap, improve the diversity of boards and strengthen protection from discrimination - and would ensure that we could safeguard existing protections for equalities.

“We have consulted a range of stakeholders in preparing these priorities, and will continue to engage widely. I have already heard real concerns about the coherence of the measures that the Scotland Bill currently delivers. We will now be pressing the UK Government for substantial and serious discussions on these proposals, in line with the commitment made by the Prime Minister to the First Minister in May.”