Wither the Scotland bill?

The fate of the Scotland bill has been a recurrent theme on this blog (see HERE and HERE for some examples, or use the ‘Calman Commission/Scotland bill’ category in the sidebar at the right for a comprehensive listing).  The bill will start its Lords committee stage this coming Friday, during which I understand the practice is not to propose amendments, but only to discuss the bill.  (Amendments get proposed at report stage.)  However, although the Scotland Bill Committee has reported to the Scottish Parliament, there’s no sign of the legislative consent motion being tabled in plenary.

This absence is important.  Legislative consent needs to be affirmative; it can’t be presumed by its absence.  In the absence of an LCM, Holyrood can’t even vote to reject the bill – and its progress to the statute book is as stymied as if there were a clear motion opposing the bill.  (I’ve argued earlier, HERE, that respecting the Parliament’s power to block the bill is constitutionally fundamental.)

There is plenty of scope for negotiation about the bill, despite the long list of changes identified in the Scotland Bill Committee’s report.  Many of the changes named there – the demand for full fiscal autonomy, for example – are there to be negotiated away.  Given the recent comments of Linda Fabiani, the committee’s convenor, asking for the Secretary of State to propose changes, it seems that the SNP remains keen to see the bill pass, with appropriate changes.  It equally appears that Michael Moore is unwilling to enter that sort of debate – though, given the terms on which it’s now being held, it has become something of a dutch auction.  Moore’s self-imposed deadline of ‘the end of this parliamentary session’ (meaning May, or thereabouts) for passage of the bill adds to the pressure.  The pressure is, however, mostly on him.

As an aside, it’s worth noting the rather unusual intervention of the Lord President of the Court of Session in the debate about the bill’s provisions concerning criminal appeals to the UK Supreme Court.  There’s a press statement here, from which Lord Hamilton’s ‘written representations’ can be downloaded, and a news report here.  The Lord President emphasises his statutory authority (under the Constitutional Reform Act 2005) to make those.  The substance of his representations is to side with the review group chaired by Lord McCluskey set up by the Scottish Government, that the Court of Session should be able to certify cases which go to the UK Supreme Court on human rights grounds.  (See also news coverage here.)  The alternative to this is Advocate General’s position, reflected in the Scotland bill, that such cases should continue to go automatically to the UK Supreme Court as they are ‘devolution issues’.  Such an intervention adds further weight to the calls (from many in the law in Scotland, though not the Law Society of Scotland) to amend those provisions of the Scotland bill.

The question of whether the bill still serves any purpose is a valid one.  Regardless of how far the constitutional debates have moved since the bill was first introduced into Parliament (only 14 months ago), it still serves two purposes.  The first is as valid for anyone who wants to see ‘devolution max’ happen.  What the bill proposes in terms of fiscal devolution remains revolutionary in administrative terms.  Getting HM Customs & Excise to grapple with arrangements for collecting different rates of income tax is necessary not just to make the bill’s arrangements work, but as part of creating the machinery for any further fiscal devolution in future.   It’s a vital step along the path toward a fiscally decentralised UK.

Second, it’s clear that the people of Scotland want something more than devolution as enacted in 1998, and indeed more than the bill provides.  Heading into a referendum, the worst position for unionists to be in would be to argue that devolution can only mean what was enacted in 1998 and cannot change or develop.  If the bill fails to reach the statute book, that’s exactly the message that will sent to Scottish voters.  In that context, a defeat for the bill does not send the message ‘SNP oppose further powers for Scotland’, but ‘independence only meaningful alternative to status quo’.  That message will work electorally to the SNP’s benefit in the referendum, not the unionist parties’ – and of course the SNP will have no objection to letting the unionist parties score an own-goal if they wish.

UPDATE, 26 January: The list of marshalled amendments to the bill for Friday’s start of Lords committee stage as of 24 January is available here (though check here to see if this is the latest one).  There’s quite a range of amendments.  Lord Forsyth and Lord Foulkes both want  (different) referendums on the tax powers. Lord Foulkes also objects to them entirely, while Lord Forsyth is willing to devolve some smaller taxes including excise duty and air passenger duty, but on their existing basis.  (That would mean Holyrood could change the rates of tax but not what it’s charged on – so it’s a transfer of a source of revenue, but not a way of using tax as a lever to encourage or discourage particular sorts of behaviour.  And to devolve excise duty as Forsyth proposes would in fact mean establishing an internal trade barrier to the movement of alcoholic drinks, as you’d need to charge duty on the movement of alcoholic drinks across the England/Scotland border.)  Foulkes also proposes amendments to ensure the Scottish Government’s name is ‘the devolved Scottish Government’.  The Earl of Caithness wants  a referendum in Orkney and Shetland to allow them cease to be part of Scotland if there is a referendum on independence.  There’s also an independence referendum amendment, proposed by Lord Forsyth, Lord Lang and the Earl of Caithness.

Less dramatic but more practical are amendments by the Duke of Montrose to delete the clause preventing Holyrood legislating in relation to Antarctica.

Most interesting in practical terms are the amendments relating to legal provisions and the courts.  There are also some detailed amendments relating to the legal system from Lords Boyd of Duncansby and Lord Browne of Ladyton (more familiar as Colin Boyd QC, former Lord Advocate , and Des Browne, former Secretary of State for Scotland).  Theirs include deleting clause 7, allowing referral of particular clauses of bills to the UK Supreme Court (a good amendment to address a bad clause).  There are amendments from both Lord Wallace and Lord McCluskey to give effect to their different position about human rights-based appeals to the Supreme Court, and the question of certification.

Lords Committee stage (and report stage) are going to be messy, protracted affairs.  This just reinforces the point I made above – that time pressure to complete it progress through WEstminster, as well to secure Holyrood’s legislative consent, means that this bill is in fact very likely just to die.  The only way to save it will be for the Scotland Office to remove Michael Moore’s self-imposed block on carrying it over to the next session.

FURTHER UPDATE, 27 January: Some further supplementary amendments can be found here.  The most notable is Lord Foulkes’s probing amendment concerning fiscal autonomy.

Devolving air passenger duty, or not

One of the important decisions that came out with the UK Government’s Autumn Statement relates to the devolution of air passenger duty (APD).  The debate about devolving APD has now been going on for some time.  The Calman Commission recommended its devolution in unequivocal terms, along with stamp duty land tax and some smaller land taxes, noting that these

tax items which are less mobile, and so are unlikely to cause significant economic distortions.  These also provide useful additional fiscal levers to the Scottish Parliament … [A]llowing a Scottish rate of such taxes would offer a better match of policy instruments to the existing powers whilst not necessarily creating economic inefficiencies. (Executive summary, para. 27; Consultation Response – Evidence from the Independent Expert Group: Summary and Conclusions, para. 5)

 The Labour UK Government didn’t agree.  In the 2009 white paper Scotland’s Future in the United Kingdom, Cm 7738, it said:

 The Government’s assessment is that state aid rules, competition considerations and international aviation agreements restrict its ability to devolve air passenger duty. The Government does not therefore attach priority to the implementation of this recommendation although it will keep the position under review. (para .4.22)

The Coalition took a different view.  The 2010 Command paper Strengthening Scotland’s Future, Cm 7973, said:

On air passenger duty, the Government is considering the wider future of aviation duty, and it would not be practical to devolve this duty while these considerations are ongoing. The Government will consider devolution as part of the ongoing work on aviation taxation. (p. 13)

That consultation related to the Lib Dems’ favoured idea of moving to charging APD per plane, not per seat – so encouraging airlines to fill all seats on a plane, and reducing emissions per

Holyrood’s Scotland Bill Committee publishes its report

The Scotland Bill Committee at Holyrood has just published its report.  The report, in two volumes is available here; the Parliament’s press release about it is here. There’s a BBC News report here.

The report is not a straightforward one to summarise, and I haven’t read it properly myself yet. Broadly, there’s cross-party agreement that the bill needs extensive amendment before the Parliament can give it legislative consent, notably on constitutional issues.  A majority (SNP members, with Green support) also oppose the income tax provisions as they stand, have sought full fiscal autonomy and devolution of welfare benefits (for which the bill is a wholly unsuitable vehicle), and much greater control over HM Revenue & Customs including a separate ‘Scottish department’ within HMRC.  The SNP and Green members also want ‘joint approval’ of the introduction in practice of the income tax power, to ensure that UK does not abuse the blank cheque a straightforward approval would otherwise give them.  This last is likely to be the most explosive point for the UK Government, which has signalled that this is emphatically not on offer.

Holyrood and the Scotland bill: the crunch looms

Robbie Dinwoodie reported in Friday’s Herald (here) that it was likely the Scotland Bill Committee at Holyrood would recommend that the Parliament withhold legislative consent unless joint commencement arrangements for the income tax provisions were agreed.  It’s odd that this particular issue should seemingly be the decisive one, though less so if one looks at the conduct of the various parties.

The unease of the Holyrood committee about the bill is no wonder.  The committee has an SNP majority, including three ex-ministers.  The UK Government has declined to amend the bill as requested by the predecessor committee, let alone in accordance with the changes sought by the SNP Scottish Government.   The bill already failed to incorporate some recommendations made by the Calman Commission (notably devolving a share of income tax arising from interest and dividend payments, air passenger duty and the aggregates levy), but included a UK Government wish-list of powers over matters like referrals to the UK Supreme Court and international relations that would increase UK power to control the use of devolved powers.  None of that is conducive to helping gain support for the bill at Holyrood.  There’s a long list of concerns about the bill, including those set out in my own evidence, and the evidence of Michael Moore and David Mundell last week may have been emollient but it was also unyielding.

Scottish independence referendum developments

The last couple of weeks have seen spats about Matt Qvortrup’s views on an independence referendum and its use by the Scottish Government and about Aidan O’Neill’s doubts about the legal competence of an independence referendum (most fully set out here; there’s also a report from the Daily Telegraph here).  Sir David/Lord Steel’s concerns have also had an airing (reported in Scotland on Sunday here).  Now, there’s a broadside from Adam Tomkins, John Millar Professor of Law at Glasgow University and a legal adviser to the Lords Constitution Committee.

This comes in the form of Tomkins’s evidence to the Commons Scottish Affairs Committee’s inquiry on a ‘referendum on separation for Scotland’, reported in today’s Scotsman here.  (The inquiry was previously discussed HERE).  Tomkins is highly doubtful about Holyrood’s power to call any referendum on independence, certainly one involving multiple options or a question targeted directly at independence.  He takes the view that the powers of the Scottish Parliament and Government are limited to ‘devolved matters’.  I find that unconvincing to an extent, as there are no ‘devolved matters’ when it comes to the Parliament’s powers – there are reserved and non-reserved ones. While ‘the Union of the Kingdoms of Scotland and England’ is a reserved matter, questions about issues related to negotiations to change that would seem to be within competence (hence the legal merit of the ‘two referendums’ approach).

The Scottish Lib Dems’ ‘home rule commission’

Sir Menzies Campbell has been announced as the chair of the Scottish Liberal Democrats’ home rule commission, first announced by Willie Rennie in September at the UK Lib Dem conference in Birmingham.  There still aren’t many details about the commission, particularly its terms of reference or composition (other than Sir Ming).  About all we know is that Rennie says it is to ‘set out our vision for a strong Scotland within the UK and for strong, powerful communities in every part of Scotland’.  That suggests it will be concerned not just with Scotland-UK issues, but also local government ones.

There’s coverage from BBC News here and the Scotsman here. The Scottish Lib Dems’ own news release is here.

This is hardly unexplored ground for the Lib Dems.  Indeed, that’s both part of the problem for this commission, and part of the reason for it.  Back in 2006, the Lib Dems were the only one of the unionist parties in Scotland willing to think about constitutional matters.  The Steel Commission  came up with a blueprint for extremely far-reaching devolution, so much so that it was used by the SNP as the basis for the ‘full devolution’ model sketched in the November 2009 white paper Your Scotland, Your Voice.  In effect, the Lib Dems wrote the SNP’s version of Devolution Max.  That in turn has made it very hard for the Lib Dems to challenge the SNP on constitutional matters, as every time they do they have their earlier position thrown back at them. That knot has been compounded by the insistence of Lib Dems in the UK Coalition as being effectively unchangeable.  I’ve heard quite senior Lib Dem figures confirm with equal vigour and in the space of five minutes that the party is committed to the Steel Commission, to the Calman recommendations/Scotland bill in its current form, and to a federal United Kingdom.  They showed no awareness of how contradictory these positions were.

The new commission has got to avoid making the mistake the Steel Commission did.  That was to come up with a scheme for very extensive devolution within the Union, without having any good rationale for why there should be a Union or what it should do.  The UK level, in the Steel Commission’s schema, was largely a residuum of things that either couldn’t be devolved without clearly breaking up the Union (such as defence or foreign affairs), or which it just considered were too cumbersome to handle.  To be convincing, any unionist argument has got to include a positive rationale for the continuation of the Union, not just convenience.

UPDATE: I shall be talking about this on The Politics Show Scotland on Sunday 6 November: 12 noon, BBC 1 Scotland (though I think the ‘Scottish’ bit starts at 12.45), 3 pm on the BBC Parliament channel, or via the iPlayer.

More evidence to the Scotland Bill Committee at Holyrood

It’s been a busy week.  After giving evidence in Cardiff on Monday, I travelled to Edinburgh to give evidence to the reconstituted Scotland Bill Committee at Holyrood.  This of course was my second stab at this, following my appearance in January.  After May’s election and the SNP majority, this committee was reconstituted to look again at the Scotland bill and advise the Parliament about whether to give legislative consent to it or not.  As the UK Government has sought to indicate that the Parliament gave legislative consent before the May elections, this itself is something of a point of debate between the UK Government and the Parliament.  This came out in the evidence of the Advocate General, Lord Wallace of Tankerness QC, who appeared immediately before me, mainly to discuss the clauses regarding the powers of the UK Supreme Court in criminal cases raising human rights issues, but also straying a bit more widely, as he’s the UK minister responsible for the bill in the House of Lords.

My evidence was mainly concerned with financial matters – with the sorts of steps that would be necessary to put a devolved Scotland onto a similar financial footing to regional-level governments in other federal or decentralised systems.  I’m still developing my thoughts on this, but it’s increasingly clear to me that a solution will involve devolution of pretty much all personal income tax as presently charged.  I’m also increasingly inclined to think that assignment of VAT proceeds (considered and rejected by both the Calman and Holtham Commissions) is likely to play a part, largely because of problems with how the block grant works that are now becoming clear and which will have increasingly serious effects in the next few years.  At the same time, I’m sceptical about the merits of devolving corporation tax, and how that might be done, though that’s favoured by both the Scottish Government and other groups including Reform Scotland.  I’m also dubious about devolving excise duties on alcohol, because of how excise duties work, as they’re a tax levied at the point of production or importation, not the point of sale or consumption – and in a fiscally decentralised context, it’s the latter that’s appropriate.

I emphasised how significant the shift even to a modest degree of fiscal devolution would be for UK-level institutions, particularly HM Revenue & Customs.  I also explained my grave concern about the UK Government’s failure to explain how the reduction in the block grant to allow for the newly devolved tax powers would be calculated or adjusted in subsequent years.  In my view, this is a fundamental issue, and far from being ‘technical’.  Without much greater clarity about it, I do not see how the Scottish Parliament can properly give its legislative consent to the bill.

My memorandum of evidence to the committee is HERE, and the transcript of evidence from the day is here (mine begins at column 466).

Stirrings from Scottish Labour

After a protracted period in which Scottish Labour has been reluctant to concede that there is any need to have a constitutional debate between the Calman commission/Scotland bill proposals, there are now signs that Scottish Labour has realised that it has to re-think its constitutional position as well as its organisational structure.  One is a speech by Douglas Alexander MP and shadow foreign secretary at the University of Stirling, the text of which can be found in the Caledonian Mercury here.  The other is an essay by Malcolm Chisholm MSP (and former MP and Scottish minister) for Labour Hame, available here.

There are many differences between the two pieces.  Alexander is very light on constitutional thinking, or indeed saying in concrete terms what he thinks Labour should do at all. But he recognises that they have relied on negative tactics to deal with the SNP in the past, and that these have not worked.  He emphasises the need for a positive agenda, which ties together explanations of how Scotland benefits from the Union with an account of how to deal with domestic and social problems within Scotland.

Chisholm focuses much more on constitutional issues, and the need for Labour to develop a ‘devolution max’ position to challenge the SNP effectively.  His ‘devolution max’ is evidently rather less far-reaching than the ‘full devolution’ proposed by the SNP (and to be aired further by Alex Salmond in his speech at the SNP conference on Saturday).  While he is vague about details, he advocates at least some devolution of social security as well as much further-reaching fiscal devolution.

Neither of these proposals is a finished piece of constitutional thinking, but given the intellectual deep freeze in which Labour’s thinking has been confined for some considerable time, it’s striking that they are willing to be more politically and intellectually adventurous – and these sorts of work take some considerable time.

The Commons Scottish Affairs Committee’s inquiries on Scottish independence

The Commons Scottish Affairs Committee has launched two inquiries into aspects of Scottish referendum – one relating to issues relating to the holding and conduct of a referendum, and the other relating to substantive issues of separating Scotland from the UK.  Details of the two inquiries are available from the Committee’s website here, and there are news reports from the Scotsman here and the Guardian here.  Written submissions are due by 18 November on the referendum-related issues, and 11 November on the wider issues relating to Scottish independence.

There are good reasons to hold such far-reaching, substantial inquiries.  These are major issues, on which the SNP has made the running since entering government in 2007.  Now is a relatively late stage to have them, though – reflecting the lack of seriousness with which the

The devolution implications of Liam Fox’s resignation

Liam Fox’s resignation as Defence Secretary will have a significant effect on the devolution debates.  Fox may have sat in Parliament for North Somerset, but his interest in Scottish affairs has remained a significant factor since he entered government – making him one of relatively few Scottish voices in Cabinet, and among front-rank Conservative politicians.  He is, of course, a staunch Unionist of an old-fashioned stamp, seemingly very uneasy about devolution let alone any further extension of that.  One telling example of his approach was his over-spun line that weighting defence cuts in such a way as to limit their impact in Scotland would ‘save the Union’ (see the Scotsman’s story here – this was the front-page lead that day).  But I gather his influence goes further than that, and that his has been an important voice in limiting the steps the Conservative Party and UK Coalition Government were willing to take in devolving further powers to Scotland.  (It seems his influence has been much more restrictive than that of the other Anglicised Scot in Cabinet, Michael Gove.)

Fox’s removal from government is therefore likely to alter the balance in further discussions about what should happen.  One significant voice opposing extensions of devolution has gone, as all the appointments made in the mini-reshuffle are of English MPs and none of them have shown much interest in Scottish matters.  If the Liberal Democrats want seriously to open the door to meaningful change in the Scotland bill, the circumstances make it much easier for them to do so.