The IPPR ‘Devo-More’ programme is a welcome addition to the constitutional debate. It seeks to look at the wider implications for the UK rather than Scotland in isolation. This first paper focuses on fiscal devolution and follows many of the arguments in the Red Paper on these issues. The analysis rightly highlights the impact the block grant approach has on different public service approaches in Scotland, rather than the ‘moral hazard’ case that underpins Devo-Plus.
The paper reinforces the case for devolving property and income taxes to the devolved administrations. Interestingly, it also makes a case for devolving all or part of National Insurance as we argued in the Red Paper. We also agree that Corporation Tax is not suitable for fiscal devolution. However, we are less convinced of the value of assigning VAT or other revenues as this is largely cosmetic fiscal devolution.
While the paper is strong on the mechanisms of fiscal devolution it is, like other proposals, weaker on purpose. The key justification is enabling the Scottish Parliament to develop public services that reflect the preferences of Scottish voters rather than policy led by English choices. The Red Paper argues that this is only part of the story. We also need additional powers for the parliament to allow for significant redistribution of wealth within Scotland and greater control over the economy by working people.
Commenting on the paper Neil Findlay MSP said:
“The Red Paper collective is leading the debate on developing the Labour movement’s radical alternative to independence. This report from the IPPR is an important development I am sure there are themes of common interest that will be examined at our next seminar on 16 February”