Scotland Bill

My Lords, it is inevitable that this bit of our proceedings will be dominated by an argument not so much about a referendum but about fiscal autonomy and fiscal responsibility. I follow my noble friend only in the sense that I speak after him, not in the sense of following his arguments. He is a great and genuine supporter and exponent of fiscal autonomy. I am afraid that I am a total opponent of fiscal autonomy. A unitary system like ours has the great benefit of being able to move resources—public expenditure—around from richer areas to poorer areas. It so happens that that is a political objective, a political process that I am more than happy with. That is what we ought to be about: reducing inequalities. The difficulty with fiscal autonomy is, in fact, that you lose that ability. It is not so much that you freeze inequalities; you are most likely going to make them worse. The rich areas will have a strong tax base, a relatively high tax take and very few deep-seated problems to deal with. The reverse will be the case for poorer areas. Their tax base will be fragile and they will have a low tax take, but they are faced with enormous social and economic problems. Only through a unitary system does—let us say it—the state have the power to move resources around to enable those inequalities to be lessened. That is an agenda that I wish to support. Fiscal autonomy leads us in completely the opposite direction.