Scotland Bill

I was just coming to the issue of the increase in the budget. In the mean time, the budget has increased from about £10 billion when I was the first Finance Minister to about £30 billion. A broad consensus has developed in Scotland over that time that there is not enough responsibility for spending in the Scottish Parliament and the Scottish Government and that there is a need to change taxation powers—the way that the Scottish Parliament receives finance and that the Scottish Government raises finance—to ensure greater accountability of decision-making. I was not initially convinced by the proposal in the Calman commission but I have become convinced that it could indeed be workable and improve the governance of Scotland. As the noble Lord, Lord Forsyth, has just said, it is wrong to argue that the Scottish Parliament, perhaps alone among legislative parliaments in the world, is not fit to set taxes. As long as a parliament is held accountable for its decisions, it should be free to set some taxes. That opportunity in the Scottish Parliament would lead to more responsible decision-making than has perhaps been exhibited at some times over the last 12 years. This power is also fundamentally different from the imposition of the poll tax back in the late 1980s. The difference is that income tax is income related whereas the biggest problem with the poll tax was not its gearing—although that was an issue—but the fact that it was correctly perceived to be unrelated to income and provoked a reaction and civil unrest across the country. We should test the proposal here. The noble Lord, Lord Forsyth, made some important points about the need to test the detail. In my view, the principle is right. The Scottish Finance Minister having to set a budget every year and make a decision to raise taxes would enhance accountability and responsibility in the devolved settlement. However, since the Calman proposals have come forward—