Page last updated at 11:03 GMT, Monday, 15 June 2009 12:03 UK

Digesting the Calman report calls

Calman report

The Calman Commission - the body set up in 2007 to review Scottish devolution 10 years on - has delivered its long-awaited report.

Among its 24 recommendations are "radical" plans for Holyrood to take charge of half the income tax raised in Scotland.

Here is a look at what the body has recommended.

INCOME TAX

The Scottish Parliament has always had the power to vary the standard rate of income tax - the so-called Tartan Tax - by 3p, but this has never been used.

The Calman Commission has called for a new Scottish-set tax, still collected by HMRC.

This would work by the Treasury deducting 10p from standard and upper rates of income tax in Scotland, accompanied by a cut in the block grant Holyrood gets from the UK Government.

MSPs would then have to decide what to do - if they levy 10p, the amount of cash Scotland will get would stay the same, through the combination of Treasury grant, UK tax and Scottish tax.

They could choose to increase the levy and people's taxes as a result or cut it - meaning a likely reduction in public services.

Holyrood would also have to maintain the differential between standard and upper rate.

The commission has argued this move would make the Scottish Parliament much more accountable, because it would have to decide on the tax and announce the decision.

OTHER TAX

The commission has also said control over stamp duty and land tax could be devolved to the Scottish Parliament from Westminster.

It made the same call on landfill tax, air passenger duty and aggregates levy.

This would also see a relative cut in the Scottish block grant.

Transferring VAT and fuel duty has been ruled out, for now.

BORROWING

An issue which has provoked much recent debate at Holyrood.

The Scottish Government currently has very limited power to borrow cash, which it can use to cover short-term funding gaps.

That could be used - and possibly increased - to ease the cash flow when devolved taxes are used.

The commission also said Scotland should have prudential powers to borrow for capital investment, to build public infrastructure such as schools and hospitals.

OIL

Gaining control over "Scotland's oil" has been a key SNP policy since the 70s - but Calman warned of the reliability of North Sea revenue because of volatile world oil prices, and said value was likely to decline in future.

The report said it was attractive to speculate how these revenues might be added to the Scottish budget, but ultimately rejected the devolution or assignment of oil and gas tax receipts to the Scottish Parliament.

The commission also recognised that oil and gas revenue would continue to contribute to the UK-wide pot, therefore continuing to add to the total level of public spending in Scotland.

BARNETT FORMULA

The controversial population-based formula used to work out Scotland's share of Treasury cash under the block grant.

Calman said the Scottish Parliament still needs a grant from Westminster, as many taxes are not devolved or assigned - and also recommended Barnett should stay for now.

Critics of the formula, in use since 1978, say it gives Scotland an unfairly large slice of the funding cake.

OTHER DEVOLVED POWERS

The commission has said a number of other powers should be devolved to Scotland from Westminster.

It said Holyrood should have control over airgun legislation, powers over drink-driving and speed limits and the running of the Scottish elections.

These are all issues on which the Scottish Government has clashed with UK ministers.

The SNP has long called for a reduction in the drink-drive limit and a crackdown on the use of air weapons - arguing Scotland has problems in these areas which are distinct from the rest of the UK.

There have also been wide-ranging calls from Holyrood parties to devolve the power to run elections north of the border.

They came in the wake of the 2007 Scottish election fiasco, during which 146,000 ballot papers were rejected.

The commission also said animal health funding should be devolved, along with the licensing of controlled substances for use in tackling addiction.

Its report also called for Scottish ministers to be responsible for appointing a Scotland representative on the BBC trust.

RESERVED POWERS

Handing devolved powers back to Westminster is not universally popular - especially among Scottish Liberal Democrats.

Calman has recommended Westminster sets laws on charities as well as food content and labelling.

The regulation of health professionals should also be handled on a UK basis, the commission said, along with legislation on the winding up of companies.

There was no proposal, despite a fair degree of lobbying, to change the current arrangement where devolved planning law can be used to block new nuclear power stations in Scotland.

MORE CO-OPERATION

In a period which has seen the Scottish and UK governments clash on a range of issues from the Lockerbie bomber to the funding of the new Forth road bridge, the commission has called for co-operation to be strengthened between the two parliaments.

It wants ministers to appear routinely before other parliaments and has encouraged the Commons to debate devolved matters - the opposite is a common occurrence at Holyrood.

THE UNION

The Calman commission - backed by the pro-union parties - has been much derided by the SNP for deciding not to consider the independence issue.

In its conclusions, the commission has declared devolution to be a success and said the Union works to Scotland's advantage, especially in economic matters.

HOLYROOD MATTERS

MSPs pass bills in a three-stage process, but the final hurdle, where parliament generally considers last-minute amendments and debates the final version on the same day, is under question.

It has now been suggested this process be split over two days.



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