THE UK Treasury has just two-and-a-half weeks to agree terms with Holyrood or the Scotland Bill will fail, John Swinney said yesterday.
The Finance Secretary yesterday said prolonged negotiations over the transfer of powers had stalled due to the failure to reach agreement on funding issues, including cuts to Scotland’s block grant.
Swinney said experts have shown “overwhelming consensus” for Scottish Government plans but no agreement has been reached with Treasury officials. Yesterday he warned that unless a deal is struck by February 12, the Scotland Bill will derail.
Speaking in Perth, he said no “technical impediment” was delaying progress and failure to resolve issues on the block grant adjustment, borrowing and other matters would see his government reject the legislation.
Swinney said: “Nobody at the Treasury can be in any doubt about the significance and the seriousness of the timetable. Nothing is agreed until everything is agreed. Some of the issues are easy to resolve. Other issues are more challenging.
“We are not at that moment of ‘no agreement’ yet. We have got a couple of weeks. If we don’t conclude this process, we won’t be able to legislate. We are getting kind of close to the end of the road and we have got a lot of distance to travel.”
Addressing the Scottish Affairs Committee (SAC), Swinney said he was committed to thrashing out a fiscal framework that guaranteed the Scottish Government “the flexibility it needs to create a fair and prosperous Scotland and the ability to use the powers we have in an effective way, adding: “This has to be about genuine autonomy and choice. Progress is being made but I believe we still have some significant distance to travel to resolve these matters.”
Swinney said parliamentary timetables meant February 12 was the “last moment” at which parliamentary scrutiny could take place at either side of the Border.
An agreement was expected in October and, with both parliaments entering recess from February 12-21 and Holyrood set to dissolve on March 23 ahead of the election, little time remains to get the provisions in the Scotland Bill onto statute books.
Swinney wants to use per capita index deduction to alter Scotland’s block grant when further tax powers are devolved, and claims experts giving evidence to the SAC’s fiscal framework enquiry have agreed.
Yesterday professor Anton Muscatelli of Glasgow University said there would be time for only “very limited parliamentary scrutiny” and offered his advice on how to move forward.
Swinney said the Barnett Formula was at the centre of the process as a result of the pre-referendum Vow made by David Cameron, Ed Miliband and Nick Clegg.
He said: “In the last few days of the referendum campaign the three UK party leaders agreed The Vow, as it is known, and shared it widely with the electorate in Scotland. One of the key elements of that was the maintenance of the Barnett Formula. That was essentially followed up by being included in the Smith Commission report.
"It was one of the areas where the members of the Smith Commission were at their strongest, clearest and most specific. Why? Because it emanated from The Vow. It was of course part of the current government’s manifesto at the 2015 election.
“It would be an act of very bad faith if there was an attempt to walk away from that.”
Tory MP Christopher Chope asked why politicians were “wasting so much time messing around with this sort of messy compromise” when the Scottish Government would prefer full fiscal autonomy and could try to establish that after the May elections.
However, Swinney said any such moves would “depend on a whole series of questions around the constitutional debate and the interactions between the Scottish and UK governments on the constitutional question”.
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