Scotland Bill

Debate between Lord Darling of Roulanish and Lord Dunlop

Monday 22nd February 2016 Lords Chamber

[Lord Dunlop]

I think we are reflecting at the outset that Scotland produces a lower proportion of total UK income tax. We are applying that comparability factor from the outset. The Scottish Government will still bear population risk. If there is deviation from that initial situation—whether it is a result of their policy choices—that is how they would bear the population risk.

[Lord Darling of Roulanish]

Can the Minister explain another point he raised? I am puzzled how it will ever be possible within a reasonable timescale to properly assess whether a measure taken by either the UK Government or the Scottish Government resulted in higher growth and therefore a higher tax rate or the other way round. The Minister must know that most of these matters are in dispute, sometimes for years, because no one can be really sure why a tax take went up or down. There can be a hunch or a feeling, but these things are contested maybe even decades after they happen. Given that this is a settlement that has to fix the grant every year, I am just wondering how you do it.

--- Later in debate ---

[Lord Dunlop]

As I said, the agreement will set out the mechanism by which these matters are determined, so in that sense we will have reached agreement. That will avoid the perpetual wrangling. If you like, that is one of the complexities that we have been wrestling with and why it is taking time—

[Lord Darling of Roulanish]

I have one more observation. I am just wondering how, in the case of the SNP, perpetual wrangling can be written out of the script.

[Lord Dunlop]

A good start is if we actually get an agreement that, I hope, we can announce in the not too distant future.