Holyrood will raise only 26% of its expenditure under Labour proposals

18 March 2014

Think tank’s research on Labour’s report questions 40% claim

New research by independent, non-party think tank Reform Scotland, which set up the Devo Plus group campaigning for a more powerful, accountable and responsible Scottish Parliament within the UK, has questioned Labour’s claim that its proposal will see the Scottish Parliament raise 40% of what it spends.

Using the proposals contained in Labour’s Devolution Commission’s final report, and applying them to the latest GERS figures (2012/13), Reform Scotland is today revealing that under Labour’s proposals:

The Scottish Parliament will raise in tax only 26.18% of what it spends, only marginally more than the 22.49% which will result from the Scotland Act
The Scottish Parliament will raise in tax only 20.07% of total tax raised in Scotland, only marginally more than the 16.31% which will result from the Scotland Act

These figures take into account the additional spending powers stipulated in the report – £1.7bn in Housing Benefit and £500m in Attendance Allowance – and the additional taxing power in the form of an additional 5p of income tax, which the report estimates at £2bn.

Reform Scotland’s full workings are below:

Commenting, Ben Thomson, Chairman of Reform Scotland and Devo Plus, said:

“Labour’s proposals increase the Scottish Parliament’s tax-raising powers by less than 5%, and represent only 26% of Scottish Government expenditure, which falls well short of the 40% they are claiming.

“The report is clearly motivated more by short-term referendum politics than a real desire for significant further devolution.”

ENDS

NOTES TO EDITORS

*SPICe FSU Briefing February 2014 : “For 2011-12, the OBR estimates that SRIT (10p) liabilities would have been £4.31billion, equivalent to roughly 40 per cent of income tax revenues in Scotland.” http://www.scottish.parliament.uk/ResearchBriefingsAndFactsheets/S4/SB_14-14.pdf

1. Figures are taken from Government Expenditure & Revenue Scotland 2012-13, published March 2014 and, where stated, Labour’s Devolution Commission’s final report.

2. Media enquiries to Andy Maciver on 07855 261 244 (andy@messagematters.co.uk) or Peter Duncan on 07740 469 949 (peter@messagematters.co.uk).