Scotland Bill

Part of the debate – in the House of Commons at 2:52 pm on 27th January 2011.

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Photo of Graeme Morrice Graeme Morrice Labour, Livingston 2:52 pm, 27th January 2011

The reality is that Government expenditure in Scotland is considerably greater than the sums raised in taxes. In fact, in 2008-09, the last year for which figures are available, total public sector revenue in Scotland was £43.5 billion, whereas total public sector expenditure was £56.5 billion. Under the separation that Mr Salmond wants, that would lead to a fiscal deficit of £13 billion. Let us turn to the fallacy peddled by the SNP that only under a system of full fiscal autonomy would Scotland's economy be able to generate growth. There is little evidence to suggest that this is the case. Professor Lars Feld, one of the world's leading authorities on decentralisation, has concluded:

"We do not find any robust significant effect of decentralisation on economic growth".

Professor Anton Muscatelli of Glasgow university has said that

"there is absolutely no statistical relationship between fiscal autonomy and growth, nor can there be."

The Scottish Parliament's competencies are already substantial, but we need to do more to increase accountability. Unlike the funding of most devolved regions by national Governments around the world, Scotland's block grant is unconditional and can be spent in whichever way chosen. Voters in Scotland and Members of the Scottish Parliament are therefore not exposed to the choice between public expenditure and additional taxation. The Bill ensures that those choices are made. More shared taxes; new devolved taxes; greater borrowing; greater transparency; a fair balance of shared risk across the United Kingdom-that is a fair balance of new powers to create the accountability that the Scottish Parliament needs. The Scottish Parliament will be answerable to the Scottish people for the money that it raises and spends. That is what the vast majority of Scottish people want. They do not want separation, but they do want a Scottish Parliament that is responsible for the decisions that it takes, and that is why I am supporting this Bill.