The Scottish secretaries

The coverage of the Smith Commission findings in today’s press is woeful pretty much across the board, regardless of where each paper’s allegiances sit. Right-wing Tory papers fume about the poor suffering English (without ever quite pinning down how England would lose out from the proposals) and rage at what they bizarrely interpret as hypocrisy on the part of the SNP for signing off on the report but then criticising it as inadequate.

(If it helps, chaps, picture yourselves as the creditors of a bankrupt business being offered a CVA of 10p in each pound owed. It’s better than nothing and you’d accept the offer, but you’d still be pretty unhappy.)

bullkrieg

Meanwhile, the Daily Record continues its blitzkrieg of breathtakingly barefaced bullshit, attempting to simply overwhelm gullible readers with the sheer volume (in both senses of the word) of its spin and flat-out lies.

Thus the extremely sceptical reactions of civic Scotland, trade unions and business alike is portrayed under the headline that the organisations all “welcome recommendations for further devolution to the Scottish Parliament”, with only a weaselly concession later on that in fact they’ve called the proposals inadequate.

Over on the pro-independence side, meanwhile, the coverage is wonkish and dull, with The National devoting plenty of pages to the subject but completely failing to deliver any punch. Readers are faced with many dense walls of text but no snappy graphics or bullet-point lists or solid numbers to aid understanding, and the nadir is an Alan Bissett piece which opens facepalmingly with the admission that the author hasn’t actually read the report. (Maybe we’re just old-fashioned about that sort of thing.)

We’ve already had a go at a concise summary of the key points, which brought our biggest traffic figures since September and reached over 200,000 people on Facebook, but we thought we’d see if we could boil it down even further, and we think we’ve got it to a single sentence.

“The Smith Commission recommendations give Scotland the power to spend money, but no power to create the money in order to spend it.”

Labour’s slow-witted shadow pensions minister Gregg McClymont had a difficult time on last night’s Scotland Tonight understanding the difference between “helping people into jobs” (the supposed aim of the Work Programme, the execution of which would be devolved and “creating jobs”. But it’s not terribly complicated.

In order to help someone get into a job, there first has to BE a job for them to be helped into. There are all sorts of ways you can help an unemployed person take a job, but first someone has to be offering it. The Smith Commission offers no way for the Scottish Government to create jobs, because it reserves all corporate powers.

Reducing personal income tax doesn’t create jobs – because it’s a tax on the employee, not the employer – so you can fiddle with it all you like without creating a single job. Income tax only applies to people who already have jobs, which was why Lord Smith struggled and dodged on the same programme when Bernard Ponsonby tried to nail him down on what actual useful effect his recommendations could have.

And the same principle applies to wealth more generally, because ultimately all wealth is generated from employment. You could have every power on the statute book, but if you’ve only got 25p in the piggybank you can’t actually do anything with them.

So even where the Smith report gives Holyrood theoretically wide-ranging powers, they’re useless in practice. For example, while the income tax personal allowance remains reserved to Westminster, Holyrood could (so far as we can tell) exercise de facto control over it by, say, creating a zero band that covered the difference between the current allowance and the minimum wage for a full-time job.

That would lift anyone on minimum wage out of income tax entirely, and be a step towards wealth redistribution and social justice. The problem is that the equation has two sides, and the money to pay for that move has to come from somewhere. Lacking power over corporate taxation (in either direction), the pursuit of tax evaders or large areas of expenditure like defence, Holyrood would have almost no means to generate the cash needed to finance the policy.

The same applies to the new powers to create new benefits or “top up” existing ones. It’d be all very well saying “You now have the power to create a new Scotland-specific income-support benefit to lift the low-paid up to a living wage”, but once again Smith offers no means to pay for it – the only option for revenue generation is to increase personal income taxes, and as countless people have already pointed out, that’s just not practical in an effectively unitary state where those you’re trying to get the money from can easily move 100 miles down the road and save themselves thousands of pounds a year.

(The counterpoint, of course, is to suggest CUTTING the higher rates of tax to lure wealthy English people north, but then you risk triggering exactly the “race to the bottom” that’s given as the reason for refusing to devolve Corporation Tax, and the political uproar would be ruinous to whichever party tried it, again rendering it impossible in practice.)

The Smith Commission’s recommendations, an attentive observer might therefore conclude, have been specifically designed to create theoretically significant levers of government which can’t actually be pulled. It’s a situation described by the novelist, academic and human-rights activist Ariel Dorfman as:

“Responsibility without power, the fate of the secretary through the ages.”

And “secretary” is a pretty accurate assessment of the role the Smith report bestows on the Scottish Government. It has to manage all the admin, but can make none of the important decisions. It has freedom in the sense that any secretary is free to do a bad job, but only in the knowledge that they’ll soon be fired if they do.

There’s nothing wrong with being a secretary, of course. But Scotland has just been left in no doubt whatsoever as to who the boss is.

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Source: Wing Over Scotland

Monkey disowns organ-grinder


Monkey disowns organ-grinder


We mentioned this story (about David Cameron pushing ahead with “English votes for English laws” legislation that would exclude Labour MPs from budget votes, despite the Smith Commission report categorically saying he wouldn’t) earlier today, but one particular line from it deserves a post of its own.

“In a briefing to journalists afterwards, [Alistair] Carmichael who described the commission proposals as ‘a modern blueprint for home rule’ insisted that the view did not reflect government policy.

He said: ‘This is the Prime Minister’s view, it is not government policy.’”

You heard it right, readers: a never-seen dimwit in a job so pointless he himself stood in the last election on a policy of abolishing it altogether really just said “Don’t listen to anything this idiot says about government policy, he’s only the Prime Minister.”

It’s been that sort of day, folks.

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Source: Wing Over Scotland

Bams to the slaughter


Bams to the slaughter


You have to hand it to David Cameron – he doesn’t hang about. Barely two hours had passed after the declaration of the result of the independence referendum when he started tying new devolved powers into legislation on “English votes for English laws”, in a slick knifing of his unsuspecting hitherto-allies in Labour.

bams

And just as hot on the heels of the Smith Commission’s final report, he’s at it again.

The hapless gullibility of Labour seems to be boundless. Having needlessly shackled themselves to the Tories in “Better Together”, resulting in what currently looks like electoral destruction on both sides of the border, they now seem to be set to reap the whirlwind, having never once stopped to question why it might have been that the campaign was chiefly and enthusiastically funded by millionaire Tory donors.

hotherballs

For once, David Cameron actually has a point. It was indefensible for Scottish Labour MPs to intervene crucially in the 2004 vote that forced tuition fees on England, safe in the knowledge that their constituents wouldn’t be affected by the policy. And everyone but Labour accepts that EVEL is the only practical, democratically-legitimate answer to the decades-old West Lothian Question, requiring any party wishing to pass laws affecting only part of the UK to have a mandate in that part.

In the wake of Smith’s recommendations it’s hard to see how Cameron could now be stopped from enacting legislation before the end of the current Parliament, and with Labour looking – at best – unlikely to win an absolute majority in 2015 it would be very difficult to revoke any law, given that none of the opposition parties would be likely to support any attempted repeal (which would strengthen only Labour).

Even the most cynical of seasoned observers must be agog at how willingly the party seems to have blundered into the elephant trap, and at the desperate black comedy of its proclamations that a last-second face-saving clause tacked onto the end of the Smith Commission report offer it any protection.

(Indeed, even Labour itself doesn’t seem to buy that one.)

It remains to be seen whether the polls suggesting Labour will lose the vast bulk of its Scottish MPs next May turn out to be accurate. But what the PM said this morning, before the ink was even dry on the signatures at the bottom of the Smith report, revealed was that it won’t matter anyway. Because by then, it’ll be too late for them.

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Source: Wing Over Scotland

Smith Commission falls short of devolution vow

Smith Commission falls short of devolution vow






Screen Shot 2014-11-27 at 11.42.42

Lord Smith outlines his recommendations

The Smith Commission report out today contains some positive measures that can be used by the Scottish Government to the betterment of Scotland.  It is also true to say that it is the largest movement of power from Westminster to Scotland since the formation of the parliament, but it falls well short of the vow made by the leaders of three of the four main Westminster Unionist parties.  It falls even further behind the promise of the No campaign’s official spokesperson Gordon Brown that Scotland would be as close as possible to a federal state within one or two years, or Danny Alexander who told us to expect  “effective Home Rule”.

Federalism and effective home rule it isn’t, but that hasn’t stopped The Times from screaming from its front page “Fears of a federal UK as Scots get new powers”.  Now I obviously could never write for the Times as the headline I would have used is “Hope for creation of a federal UK as Scots get new powers”.

The Times today states Under the agreement, Scottish MPs will still be able to vote on income tax rates in the rest of Britain but English MPs will have no say north of the border. However, No 10 said yesterday that it would still press ahead with plans to force English-only votes for English laws after the election.”

The backlash and co-ordinated campaign to stop the Smith Commission recommendations from being implemented will now move into full swing. We shall have to watch closely as Westminster MPs seek to further water down Smith’s recommendations.  Today in Westminster Conservative MP John Redwood asked the Scottish Secretary (Carmichael) if he agrees that “once Scotland is determining its own income tax rates in the Scottish parliament, it would be “quite wrong for Scottish members of this parliament to fix the bands and rates for the English”.

It will be interesting to see what UKiP (now outpolling the Lib Dems in England) has to say about the report given its last Scottish manifesto effectively suggested shutting the Scottish Parliament.

It strikes me that the unionist parties have a track record in attempting to placate the Scottish people with promises to match the growing support for constitutional change and then letting them down in the final delivery of recommendations.  The Calman Commission being a case in point, where the powers that were delivered were underwhelming and seen to be such by the people of Scotland.  The failure of Calman to wow the people of Scotland, combined with the generational shift away from Unionist parties that continues today, set us up for the referendum.  The Failure of Smith to impress or the failure of Westminster to support its implementation without catches and unworkable caveats will reopen the independence debate within a few short years, and Yes will very much be in the ascendancy.

The Smith Commission – what’s good and what’s missing

Any step towards the goal of giving the Scottish Parliament the ability to govern Scotland more excessively for the benefit of the people of Scotland should be welcomed.

From a business point of view, control over Air Passenger duty is a good move and will help boost Scotland’s international connectivity which is vital for business and tourism. However, the lack of powers to vary VAT rates, for example to lower VAT rates on tourism related activity in the same way as Ireland and 23 other EU nations, means that the Scottish Parliament will not have the ability to create a joined up connectivity and tourism strategy that would boost overnight stays and rural economies and create jobs.

Cameron favours devolving corporation tax to Northern ireland but not Scotland.

Cameron favours devolving corporation tax to Northern ireland but not Scotland.

The lack of devolution of tax incentives for research and development will slow Scotland’s ability to catch up with the rest of Europe on growth optimised levels of research and development. No corporation tax varying powers is a bit of a shocker when you consider that Northern Ireland is expecting corporation tax to be devolved. In fact Prime Minister David Cameron has said “the argument made for the devolving of corporation tax powers to Northern Ireland is strong.

Corporation tax powers would allow the Scottish Government to create incentives for companies to invest in key areas that underpin the Scottish economy and, in particular, in projects that create jobs and boost vital sectors such as tourism, food and drink, innovation and manufacturing.

It’s good that Scotland will see progress in control of personal taxation, but no control of employer national insurance contributions or the personal allowance which could allow the working poor to earn more before being taxed, child and working tax credits, and full control over the welfare system – all of which stay with Westminster – leaves the Scottish government with only half the tool set required to boost jobs and the attractiveness of work through welfare powers.

Failures to progress in key areas

According a Panel Base poll published in October, the most popular areas that people would like to see devolved to Scotland are the very ones where the proposals fall short.

71% supported control of all taxation raised in Scotland, 75% wanted control of the welfare and benefits system and 72% sought guaranteed consultation by the UK Government with the Scottish Government when deciding the UK’s stance in European Union negotiations.  Disappointment on key powers then?

Key organisations will be disappointed

During the commission’s deliberations I represented Business for Scotland at a commission round table discussion and the input of several key organisations in Scottish life was sought.  The Scottish Council for Voluntary Organisations (SCVO) were very keen to see major welfare powers and I suspect they will see this as a missed opportunity to devolve the key welfare powers.

Screen Shot 2014-11-27 at 11.26.09Even key Labour party supporting organisations (possibly not for long) such as the STUC will likely be disappointed that the minimum wage will still be set in Westminster under the beady eye of the CBI, rather than in Scotland with an eye on the opportunity to address and eventually end in work poverty.

Grahame Smith, general secretary of the Scottish Trades Union Congress (STUC) said he was “underwhelmed” by the package of recommendations which “does not meet our aspirations”.

He added: “STUC continues to believe that control over employment law, equalities and minimum wages is a necessity if inequality is to be effectively challenged. We will continue to press for this.

Conclusion

Some of the unionist parties have had to compromise hard on their weak position on devolving more powers, and it is good to see the Labour Party bring its position up to the same level as the Conservatives and Liberals.  How Labour ever fell into a trap of being the party of less devolution when compared to the Conservatives is  mind boggling – perhaps they should have listened to their branch office more.  The Yes supporting parties have also compromised, the No vote made that a requirement, however we do see some progress in the Smith Commission’s recommendations. But what we have is, essentially, what the Calman Commission should have been allowed to be and not what we were promised in the vow.

The devil is in the detail and over the next few weeks and months we will see how Westminster reacts. If the proposals are blocked, watered down or tied to stopping Scottish MPs voting on devolved issues (Cameron’s Labour killer plan) or if cuts made by the Scottish Government, say in APD, result in withering cuts in our block grant then the vow has failed and the union will fall.

What’s your view? Leave a comment and tell us if you think the Smith Commission recommendations go far enough and if you think Westminster will agree to implement them.

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Tags: ‘featured’

Category: Business for Scotland, Business Policy, CBI, Devolution, Economic Policies, Gordon MacIntyre-Kemp, Independence in the UK, manufacturing, polls, Smith Commission, Tourism


http://www.businessforscotland.co.uk/smith-commission-falls-short-of-devolution-vow/
Original Source: BusinessForScotland

And now for the truth

It’ll be a brave Yes voter who buys a newspaper (other than The National) or switches on their TV or radio today, because Scotland is already enduring an outpouring of concentrated spin and outright deception that perhaps even exceeds that seen in the last few weeks before the independence referendum.

pishlies

Blood pressures will be soaring across the land as people are told things about the final report of the Smith Commission that are flatly at odds with the reality, by journalists and broadcasters who either know perfectly well that what they’re saying is false or haven’t bothered to try to find out.

Below, you’ll find the facts.

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1. The Smith Commission’s recommendations are just that – recommendations. They are not law, and are not binding on anyone. The Commission, for example, recommends the devolution of Air Passenger Duty and the Aggregates Levy.

But devolution of Air Passenger Duty and the Aggregates Levy were also recommended by the Calman Commission in 2009 (paragraph 27), yet NOT devolved by the subsequent Scotland Act.

As happened in 2010, it’s perfectly possible than the incoming UK government could simply reject the recommendations. Scottish Labour opposed the devolution of Air Passenger Duty in its devolution proposals earlier this year and has made no subseqent statement revising that view.

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2. Despite the hysterical front page of today’s Daily Record, the “Scottish Government budget” will NOT be “almost doubled” by the recommendations, even if they were implemented in full. The Smith Commission report is extremely clear on the subject:

“the Scottish and UK Governments’ budgets should be no larger or smaller simply as a result of the initial transfer of tax and/or spending powers, before considering how these are used. 

(a) This means that the initial devolution and assignment of tax receipts should be accompanied by a reduction in the block grant equivalent to the revenue forgone by the UK Government.” (page 25, paragraph 95)

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3. The Record also claims, breathless with excitement, that “Scotland will be allocated £5 billion of VAT receipts, 50 per cent of the VAT take in the country”. But the Smith report makes abundantly plain that this too will NOT result in any extra money for the Scottish Government’s budget:

“The receipts raised in Scotland by the first 10 percentage points of the standard rate of Value Added Tax (VAT) will be assigned to the Scottish Government’s budget. 

These receipts should be calculated on a verified basis, to be agreed between the UK and Scottish Governments, with a corresponding adjustment to the block grant received from the UK Government in line with the principles set out in paragraph 95.”

Paragraph 95 is the section we’ve quoted in point (2) above, which explicitly says that any changes should not result in an increase or decrease to the Scottish Government budget, directly at odds with the Record’s spin.

What that means is that any “extra” money assigned in VAT will be immediately clawed back from the block grant. In other words, the amount of money in Holyrood’s budget will be exactly the same, but some of it will be labelled differently.

Westminster will hand Scotland a tenner with one hand, and take back two fivers with the other hand.

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4. Almost all welfare powers will remain reserved to Westminster:

smithwelfare

Housing benefit will NOT be extricated from Universal Credit, as Labour’s devolution proposals had claimed would be possible (without ever explaining how). Holyrood’s power will extend only in being able to pay housing benefits weekly or fortnightly instead of monthly.

Paragraph 45 merely reiterates what is the current position – Holyrood can mitigate the effects of the bedroom tax by paying it out of its own budget. It will NOT be able to “abolish” the tax. The only change recommended by Smith is that Holyrood will now be able to do so for other benefits without requiring Westminster’s permission first.

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5. As we’ve previously discussed, the changes to control of income tax are in practical effect non-existent, and were almost all provided for already by the Scotland Act 2012 and due to be implemented by 2015/16 anyway.

But even the limited proposals in Smith are all but meaningless. As noted by the BBC’s Douglas Fraser today, it is in practice close to impossible to effectively vary income tax rates inside the borders of a unitary state:

“within a united Britain, it looks like being very easy for high earners to move their tax address to other parts of the UK, avoiding the highest rate of tax, and depriving the Scottish finance minister of a lot of cash.”

Smith also does NOT propose devolution of revenue from income tax on savings and dividends – something else which WAS recommended by the Calman Commission report (pararaph 32) but not implemented. This further reduces any possible powers of wealth redistribution, as does Westminster’s retention of personal allowances.

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It would be churlish to claim that the Smith Commission report doesn’t recommend ANY new powers at all. For example, there’s this:

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But allowing the public sector to bid for rail franchises, the devolution of some limited powers relating to the Crown Estates and fracking, some incapacity benefits, and the ability to give 16/17-year-olds the vote in Holyrood elections, are to be welcomed should they actually be implemented. It wasn’t plausible for the Commission not to throw Scotland SOME crumbs, and crumbs are better than nothing.

Nevertheless, the Smith report represents the absolute bare minimum the Unionist parties thought they could possibly get away with. In terms of giving Holyrood the ability to create jobs, grow the economy or improve social justice, it offers nothing whatsoever. It won’t rescue a single family from a single foodbank.

reservedpowers

The tax powers, meanwhile, are cosmetic and almost entirely unusable. The partial “devolution” of VAT receipts is simply the relabelling of one part of the money that Holyrood already gets. Expressly and explicitly, the Commission’s recommendations will NOT add a single penny to the Scottish Government’s budget.

The Scottish and UK media, for their own varying and sometimes contradictory reasons, will spend today and much time in the next few months attempting to massively exaggerate the actuality and the ramifications of Lord Smith’s conclusions. Readers should trust them even less than usual, if such a thing is possible.

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Source: Wing Over Scotland

The biggest lie in history


The biggest lie in history


We’re going to hold off full scrutiny and analysis of the Smith Commission report on devolution until it’s actually released, rather than going on pure speculation like most Scottish newspapers this morning.

biglie

But what we CAN talk about is this.

The Daily Record’s front page this morning is almost certainly the most shameful, knowing, deliberate lie ever published in a newspaper in Scotland since the invention of the printed press. It is simply utterly without basis in fact, and the person writing it knows it to be so.

Whether it comes from a block grant or from collecting tax itself, the “Scottish Government budget” will be changed this much by the recommendations of the Smith Commission, even if they’re implemented in full: not one single penny. The source of some of its money will change, the amount of it will not.

Even if you grant Torcuil Crichton some wiggle room on the grounds that headlines and straplines often sacrifice accuracy for impact, the full article in the paper is equally false in both letter and spirit.

“Scotland’s Parliament will be responsible for billions of pounds of extra tax and welfare spending under a radical devolution package to be unveiled today.”

No, it won’t. It will NOT be responsible for ANY extra spending. That sentence is a lie. There is absolutely NO “extra tax”. Nobody will pay a penny extra to anyone. The amount of tax taken from Scottish taxpayers will be exactly what it is now.

The rest of the story is packed full of further lies, but none of the magnitude of the one on the front cover. It is simply the most disgraceful untruth – both in the depth of its deliberate cynicism and the magnitude of its falsehood – ever told to Scots.

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Source: Wing Over Scotland

Vow left on bus, eaten by dog


Vow left on bus, eaten by dog


We’ve had a reply.

A few weeks ago we sent this letter to the Prime Minister’s office.

vowfoi2

Today we heard back.

“I am writing to advise you that following a search of our paper and electronic records, I have established that the information you requested is not held by the Cabinet Office.”

Other than the standard boilerplate, that’s it. That’s all of it. No withholding of data on the grounds of privacy or national security or any of the usual dodges, just a flat-out denial that it happened at all. Nothing to see here, move along.

Daily Record editor Murray Foote expressly stated this month that email was the delivery mechanism. Now the Prime Minister claims no knowledge of any such emails. How, then, was “The Vow” arrived at? A midnight chat in an underground car park? Smoke signals? A nod and a wink and a tap of the nose? We don’t know, and frankly we’re not sure where we go from here in trying to find out. Any ideas, readers?

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Source: Wing Over Scotland

The Great Devo Con

Two interesting comments from last night’s Scotland Tonight.

So that’s good to know.

Let’s be generous for a moment and assume Sarah Boyack just suffered from a slip of the tongue (although it was interesting that none of the three other people onscreen corrected or questioned her). That leaves us with Jim Murphy’s ever-evolving position on the devolution of income tax.

Let’s see if we can nail it down as concisely as possible.

1. Barnett currently sees Scotland given more money per head from the Treasury than most other parts of the UK, to the tune of about £1200 per head, or 16% more than the UK average spending per capita. (Scotland actually more than pays for this “subsidy” in extra contributions, notably from oil revenue, but we’ll leave that to one side for the moment as it’s not the point under discussion.)

2. Each £1 in revenue that Scotland collects for itself should therefore strictly result in the reduction of the block grant by approximately £1.16, as that’s the premium Scotland currently receives.

3. This would clearly leave Scotland significantly worse off. The only way to reduce that shortfall (other than large tax increases in Scotland) would be to INCREASE the size of the Barnett premium on the remainder of the block grant paid by Westminster to Holyrood each year.

(This will be extremely unpopular in England, and likely to increase the pressure from Tory and Welsh MPs for a future revision to Scotland’s detriment.)

4. In that scenario, in reality NO new tax powers are being devolved. Scotland will be exactly where it is now – it’ll have the ability to subsequently increase or decrease taxes, but it’s getting that ability anyway from the already-passed Scotland Act 2012, due to come into effect next year.

(Which, contrary to popular belief, does NOT stipulate any maximum increase. The “devo nano” proposals which are still Labour’s official position, regardless of what Jim Murphy says, would in fact REDUCE the flexibility of Holyrood’s tax powers compared to the 2012 Act.)

5. The same scenario also destroys the idea that Holyrood will be any more “accountable”. Westminster will be paying to maintain the status quo, because if Holyrood keeps taxes exactly where they are now, nothing will change (except that there’ll be some expensive and complicated new bureaucracy running an extra tax office). Holyrood can just sit on its hands.

In short, if what Jim Murphy told us last night is true (which is of course a very large assumption), the whole premise of devolving tax will have been a charade. There will be NO “new powers” at all, just the old 2012 ones with a different label attached. The people of Scotland are being taken for mugs.

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Source: Wing Over Scotland

Another rise in inflation


Another rise in inflation


It’s still Jim Murphy Day here at Wings (did you all get nice presents?), but we’re as sick as you are of hearing him avoid questions about devolution, so instead we’re going to take a look at something else he said this afternoon.

“Mr Murphy said that, under his leadership, ‘Scottish Labour would introduce a 50% tax rate for people in Scotland earning more than £150,000 per year’.

‘We believe that those who can afford it should pay a little more. There are 16,000 people in Scotland earning more than £150,000 and increasing the highest rate of tax from 45% to 50% would raise around £250m.’”

£250 million? We’re sure it used to be rather less than that.

Here’s Johann Lamont in March this year (skip forward to 58 seconds in):

JOHN MACKAY: You propose increasing taxes on high earners from 45p to 50p. What will that raise?

JOHANN LAMONT: We think it’s something like £100m. […]

MACKAY: The Institute for Fiscal Studies predicted it’d be something like £100m across the UK, not Scotland.

LAMONT: Well, those are the figures we have.

The IFS study Mackay referred to was this one. Here’s what it said:

“Perhaps the best evidence we have at present is that produced by HMRC, and signed off by the Office for Budget Responsibility, in 2012. This suggested that cutting the 50p rate to 45p could reduce revenues by about £3.5 billion in 2015–16 if there was no change in behaviour by affected individuals.

However, once one allows for behavioural response, their central estimate was a cost of just £100 million – a very small amount of money. The best available estimate of what reversing the cut would raise is therefore about £100 million too.”

As Mackay had noted, that was indeed a figure for the entire UK, which would mean the revenue generated by an increase would be just £8.4 million. (And in reality less, as Scotland has a lower proportion of top-rate payers than the UK as a whole.)

So in March Labour inflated a figure of £8.4m by 1,100%, and today Jim Murphy has inflated it again by a further 150%. (And we’re sure, having cited the IFS and OBR as infallible sources of truth all the way through the independence campaign, Labour wouldn’t suddenly decide they were unreliable lunatics now.)

We haven’t the faintest idea where the extra £150 million is supposed to have come from, and experience suggests that Murphy won’t be explaining it any time soon.

It seems that Labour not only think the Scottish electorate’s heads button up the back, but that voters will also pay £500 for each button required to do the job.

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Source: Wing Over Scotland

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