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Scotland Bill: Peers want to halt legislation until fiscal rules are agreed Scotland Bill: Peers want to halt legislation until fiscal rules are agreed
(about 7 hours later)
A House of Lords committee has called for the Scotland Bill to be put on hold until rules on new tax and spending powers are clarified. A House of Lords committee has called for the Scotland Bill to be put on hold until issues over the funding package that accompanies it have been resolved.
The Economic Affairs Committee said more detail was needed on the fiscal framework, still to be finalised. The bill completed its journey through the House of Commons earlier this month, and is now in the Lords.
The legislation is due for its second reading in the Lords on 24 November. But an agreement on the fiscal framework has yet to be reached by the UK and Scottish governments.
The UK government said discussions on the fiscal framework were constructive and both sides aimed to complete them "as soon as possible". The framework includes the adjustment that will have to be made to Scotland's block grant funding from Westminster.
But Scotland's Finance Secretary John Swinney said the Scottish government would only approve the bill if it had a "fair fiscal framework agreement". The UK government said discussions on the fiscal framework had been constructive and both sides aimed to complete them "as soon as possible".
Devolution commission Scotland's Finance Secretary John Swinney said the Scottish government would only approve the bill if it had a "fair fiscal framework agreement".
During the Scottish independence referendum campaign, the Conservatives, Labour and the Liberal Democrats vowed to give greater responsibility to Holyrood if voters said "No". Seven problems
On 18 September, the electorate decided by a margin of 55% to 45% that Scotland should remain in the UK. The Economic Affairs Committee set out its concerns in a report on the legislation, which hands a raft of new powers to Holyrood.
Lord Smith of Kelvin was appointed to head up a special commission to look at greater devolution for Scotland. Following the all-party agreement reached by the commission, the Scotland Bill was drawn up by the UK government. It identified seven problems with the bill, stating the future of the UK "could well be at risk" if they are not solved.
At the beginning of November, the bill - containing new powers over income tax and VAT - passed its final stages in the House of Commons. The legislation is due for its second reading in the House of Lords on 24 November.
But the details of the funding package that will accompany the legislation are still being negotiated by the Scottish and UK governments. The committee has said the bill should not proceed to the committee stage - the first stage where amendments can be made - until the devolution fiscal framework is published.
The House of Lords Economic Affairs Committee said the Scotland Bill had the potential to "fundamentally change" the UK, was being progressed with ''undue haste'' and should not proceed further until the devolution fiscal framework was published. Analysis by Brian Taylor, BBC Scotland political editor
Their noble Lordships are notably unhappy with the Scotland Bill. They want it put on hold until they get answers to a few minor matters. You know, wee things like the entirety of the Scottish budget for the foreseeable future.
So will there be a delay to the implementation of the bill? Yes, but perhaps not directly as a consequence of their Lordships' warning.
Rather, the problem is that the accompanying Fiscal Framework - who funds what and how - is still lodged in discussions between the Scottish and UK governments. No deal on money, no finality for the bill.
Specifically, the Scottish Parliament will not sign off on the Scotland Bill until John Swinney says he is happy with the accompanying cash package. And, right now, he is - like their Lordships - less than content.
But this is a Westminster bill. Why does it matter what Holyrood says? It matters because of the agreement that Holyrood has to signal consent before Westminster legislates on such issues.
Read more from Brian
The committee also said:The committee also said:
Committee chairman Lord Hollick commented: "The Scotland Bill has the potential to fundamentally change the UK and impact on us all both politically and economically. It is crucial that what is proposed is stable and sustainable. Committee chairman Lord Hollick said: "Parliament is being asked to pass the bill before we are told full details about the fiscal arrangements that will underpin this new era of devolution - that cannot be right.
"Parliament is being asked to pass the bill before we are told full details about the fiscal arrangements that will underpin this new era of devolution - that cannot be right. "We are calling on the progress of the bill to be halted until the details are agreed and published. That would at least allow peers the opportunity that MPs were denied of scrutinising and amending this important legislation as informed participants."
"We are calling on the progress of the bill to be halted until the details are agreed and published. Scotland Office Minister Lord Dunlop said: "There is a huge amount on which John Swinney and I, and indeed both of Scotland's governments, agree about on this issue, so now is the time to deliver what we have both committed to - the best possible deal for Scotland.
"That would at least allow peers the opportunity that MPs were denied of scrutinising and amending this important legislation as informed participants." "As a number of Peers and academics have pointed out, there are issues which will need to be resolved, but one thing is clear - both governments want a deal which will stand the test of time. We both want to retain the Barnett Formula. And we both want the Pparliamentary process which will deliver the Scotland Bill to continue."
A UK government spokesman said the Lords' report was an "important contribution" to the debate on devolution. Mr Swinney said he did not agree with "many" of the conclusions of the Lords committee, including its proposal to remove the Barnett formula.
"Fiscal framework discussions have been constructive and focused on securing a fair and workable fiscal framework which delivers the cross-party Smith agreement," the spokesman said. 'Crystal clear'
"Both governments have agreed not to comment until an agreement is reached.
"Delivering Smith and retaining the Barnett Formula was a clear manifesto commitment for the government.
"The framework will be based on the principles set out in the Smith agreement. Both governments aim to complete the framework as soon as possible in order to give respective parliaments time for due consideration of the framework and Scotland Bill"
'Satisfactory and fair'
John Swinney, who is Scotland's deputy first minister, said he did not agree with "many" of the conclusions of the Lords committee, including its proposal to remove the Barnett formula.
However, he did agree that the fiscal framework was "essential" to delivering the Smith Commission proposals "in both letter and spirit".However, he did agree that the fiscal framework was "essential" to delivering the Smith Commission proposals "in both letter and spirit".
Speaking on BBC Radio Scotland's Good Morning Scotland programme, Mr Swinney said: "I would be against there being a delay in the House of Lords because I think fundamentally we need to make progress on the Scotland Bill so that the Scottish Parliament can take its final decision on whether the bill is to be adopted before we get to the Scottish Parliament elections next May. Speaking on BBC Radio's Good Morning Scotland programme, Mr Swinney said: "I would be against there being a delay in the House of Lords because I think fundamentally we need to make progress on the Scotland Bill so that the Scottish Parliament can take its final decision on whether the bill is to be adopted before we get to the Scottish Parliament elections next May.
"I'm making my position crystal clear. The fiscal framework has to be fair to the people of Scotland and consistent with the Smith Commission report before I will recommend to parliament that it gives its legislative consent to the Scotland Bill. "I'm making my position crystal clear. The fiscal framework has to be fair to the people of Scotland and consistent with the Smith Commission report before I will recommend to parliament that it gives its legislative consent to the Scotland Bill."
"That is not a threat, that is simply a statement of the position of the Scottish government which has been expressed clearly to the UK government and to the people of our country."
Scottish Labour MSP Iain Gray said a negotiated framework which met the framework of the Smith agreement was "eminently achievable".Scottish Labour MSP Iain Gray said a negotiated framework which met the framework of the Smith agreement was "eminently achievable".
He said : "It is the job of the first minister and her deputy to get that deal for Scotland, and we have to assume that they are up to that job. They should stop wasting time with threats to walk away and refuse to accept the powers Scotland wants and is now entitled to. He said: "It is the job of the first minister and her deputy to get that deal for Scotland, and we have to assume that they are up to that job. They should stop wasting time with threats to walk away and refuse to accept the powers Scotland wants and is now entitled to."
"In fact they should promise today to stay at the negotiating table until they get a deal, which is good for Scotland and protects Barnett, as the Smith Commission demanded."