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> For 15 years the Scottish Parliament has been a fiscally lopsided institution. The money comes from a block grant from the UK Treasury. Westminster decides ho

by philh 12y ago

> For 15 years the Scottish Parliament has been a fiscally lopsided institution. The money comes from a block grant from the UK Treasury. Westminster decides how much tax we all pay and how much government there should be in relation to the economy but not how it’s spent. > You can see why there’s little room in the Scottish national discourse for a party that says “vote for us and we’ll cut your taxes; vote for us and we’ll make government smaller”. I'm not sure how this follows. Can someone clarify?

majc2 12y ago
Scotland's parliament does have tax varying powers but has never used them . So, it takes the block grant from the Westminster parliament and decides how to spend it through something called the Barnett formula. Scotland is essentially a socialist country (and socialist isn't a dirty word here). There is a sense of fair play and looking after the poorest in society - a party that would propose a tax cut for a smaller gov. wouldn't do well in the popular vote in Scotland. Does that help?
- __chrismc 12y ago
  It's worth pointing out that the only variance it can make under the existing powers is to _raise_ income taxes - this is why it's never been used. Doing so would be political suicide and see a population drain as those able to would quickly move "next door" to an England with lower taxes. The Barnett formula determines the size of the block grant, not the spending of it. The Scottish Government spends the grant according to its priorities. At the moment these include: free healthcare (including prescriptions), free higher education, and free care for the elderly.
  - DanBC 12y ago
    > free healthcare (including prescriptions), For people not in the UK: people in England pay for each item on a prescription. The charge is currently £8.05 per item. You can get discounts if you need multiple items. There are a bunch of exemptions - people with a thyroid problem for example - which mean that about 90% of items are free. https://www.gov.uk/government/news/nhs-charges-from-april-2014 https://www.gov.uk/government/news/nhs-charges-from-april-20...
    - majc2 12y ago
      It should also be pointed out that its not entirely a one way street - for example England has the excellent Cancer Drug Fund, which Scotland doesn't. http://www.scotsman.com/news/health/scottish-cancer-patients-denied-medicine-fund-1-3117297 http://www.scotsman.com/news/health/scottish-cancer-patients...
      - matthewmacleod 12y ago
        I would strongly disagree with the CDF being "excellent" – it's basically money cut from other NHS budgets and repurposed for expensive individual cancer therapies. At the very least, an expansion and improvement of the existing equivalent system in Scotland (individual treatment request) would offer a better solution for the need to fund individual specific treatments that haven't been widely approved.
- deleted 12y ago
  [deleted]
  - StavrosK 12y ago
    Better than not knowing what constructive debate is.
    - davidw 12y ago
      This is why I flag articles about politics, and why they are considered off topic in the guidelines. This is certainly a well-written, interesting article, but the discussions it's generating are going downhill fast.
  - majc2 12y ago
    I guess it depends on your definition of socialist. It's the common term thats used here - the Labour party which until recently was the dominant force in Scottish politics is a member of the Party of European Socilaists. (source: http://news.bbc.co.uk/1/hi/world/europe/8011001.stm#socialist http://news.bbc.co.uk/1/hi/world/europe/8011001.stm#socialis...) I'd argue that the vast majority of Scots would be in favour of re-nationalising both the railways and royal mail. In the case of the railways, I think there is fairly broad support across the UK for that too.
    - willyt 12y ago
      Also Railways, Post and other infrastructure are all things that make perfect sense as nationalised industries. They often end up as monopolies anyway in a free market so they might as well be state monopolies with democratic accountability.
  - keithpeter 12y ago
    OK< strictly Social Democratic. But the socialist term is widely used in UK discourse. PS: When I stayed in Glasgow for a short period about 30 years ago, a 'three way fight' in a constituency was Labour, Liberal and Communist.
  - louhike 12y ago
- arethuza 12y ago
  I can think of one particular bit of government spending that a lot of people in Scotland would be absolutely delighted to get rid of. [Hint: they all begin with V and float]
  - tomp 12y ago
    What?
    - arethuza 12y ago
      Vanguard, Victorious, Vigilant and Vengeance The UK Trident submarine fleet based in a sea loch (fjord) quite close to Glasgow, the largest city in Scotland.
    - deleted 12y ago
      [deleted]
- jiggy2011 12y ago
  Yet the SNP wants to cut corporation tax in Scotland.
sarcas 12y ago
The issue comes down to how the money is distributed and spent. The current Scottish Government has control over something on the order of 75% of the money spent in Scotland (the other 25% coming from central government in Westminister on reserved matters like defence). Conversely, as it currently stands (ignoring the new rules from 2016), the Scottish Government only has control over something like 15% of tax raising powers (again, everything else coming from Westminster). Thus, if you were a party who wanted to promise cutting taxes to the population you could, but you'd have very little impact on the taxation's bottom line. I actually don't know what the Barnett formula says about money the Scottish government doesn't spend from Westminster (wondering if you could in theory as a party in Holyrood decide just not to spend the money you were given, as a forcing tactic). Regardless, all parties (in both London and Edinburgh) and the Scottish population are in agreement, the situation of controlling spending but not tax raising is an unfit state for a government to be in. [edit - make my 'all parties' comment clearer]
- philh 12y ago
  > Thus, if you were a party who wanted to promise cutting taxes to the population you could, but you'd have very little impact on the taxation's bottom line. Are we talking about the UK parliament cutting taxes, or the Scottish parliament? I get the impression that the article is talking about the UK parliament: the author is trying to explain why the Conservatives have limited support in Scotland, and why they're trying to make the Scottish parliament responsible for raising their own taxes. But if the UK parliament cuts taxes everywhere (including Scotland), and that has little effect on Scottish spending, then it seems like incentives are such that the Scottish population would most likely support that. OTOH if it has disproportionate effect on Scottish spending, they would oppose. But if I read you correctly (do I?), you're saying that's not true; and a priori I have no particular reason to expect that the effect would be small or large relative to the cut.
  - sarcas 12y ago
    I was talking about the Scottish parliament. As I read it, the article talks about both (as I read it). Feels like I'm derailing the discussion a bit but essentially: Overall Scottish spending is not related to UK tax levels directly, but is directly related to spending in England and Wales[1]. So the argument is that there is little point in a party trying to get voted into Holyrood (the Scottish parliament) promising a smaller states and fewer taxes at the moment, because they have little proportionate control on the taxes (although again, on the spending they do in theory). The reverse is not true for Westminister - the more they spend in England and Wales, the more is available for Scotland to spend, and vice versa. Hope that clarifies what I was saying! [1]: https://en.wikipedia.org/wiki/Barnett_formula https://en.wikipedia.org/wiki/Barnett_formula
deleted 12y ago
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deleted 12y ago
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PJDK 12y ago
It's because the role of the Scottish Parliament is in deciding how a given block of money should be spent. A party that is in favour of lower taxes (and by extension lower spending) can only implement the lower spending bit - we'll cut spending and your taxes stay the same isn't much of a sell for a political party.
celticninja 12y ago
read this: http://www.futureukandscotland.ac.uk/sites/default/files/papers/Scotland%27s%20Decision%20final%20ebook.pdf http://www.futureukandscotland.ac.uk/sites/default/files/pap... there is no way they can cut taxes in the short term, not without risking the scottish economy, they may be able to offset some tax cuts at the lower rate with an increase for higher and highest rate payers. They may be able to make a smaller government that is more streamlined than whitehall however. This is not a tax based argument but basically a way of finding efficiencies in a new civil service/government that the UK parliament (as the dinosaur it is) cannot.

by philh 12y ago

majc2 12y ago

Scotland's parliament does have tax varying powers but has never used them . So, it takes the block grant from the Westminster parliament and decides how to spend it through something called the Barnett formula. Scotland is essentially a socialist country (and socialist isn't a dirty word here). There is a sense of fair play and looking after the poorest in society - a party that would propose a tax cut for a smaller gov. wouldn't do well in the popular vote in Scotland. Does that help?

__chrismc 12y ago
It's worth pointing out that the only variance it can make under the existing powers is to _raise_ income taxes - this is why it's never been used. Doing so would be political suicide and see a population drain as those able to would quickly move "next door" to an England with lower taxes. The Barnett formula determines the size of the block grant, not the spending of it. The Scottish Government spends the grant according to its priorities. At the moment these include: free healthcare (including prescriptions), free higher education, and free care for the elderly.
- DanBC 12y ago
  > free healthcare (including prescriptions), For people not in the UK: people in England pay for each item on a prescription. The charge is currently £8.05 per item. You can get discounts if you need multiple items. There are a bunch of exemptions - people with a thyroid problem for example - which mean that about 90% of items are free. https://www.gov.uk/government/news/nhs-charges-from-april-2014 https://www.gov.uk/government/news/nhs-charges-from-april-20...
  - majc2 12y ago
    It should also be pointed out that its not entirely a one way street - for example England has the excellent Cancer Drug Fund, which Scotland doesn't. http://www.scotsman.com/news/health/scottish-cancer-patients-denied-medicine-fund-1-3117297 http://www.scotsman.com/news/health/scottish-cancer-patients...
    - matthewmacleod 12y ago
      I would strongly disagree with the CDF being "excellent" – it's basically money cut from other NHS budgets and repurposed for expensive individual cancer therapies. At the very least, an expansion and improvement of the existing equivalent system in Scotland (individual treatment request) would offer a better solution for the need to fund individual specific treatments that haven't been widely approved.
deleted 12y ago
[deleted]
- StavrosK 12y ago
  Better than not knowing what constructive debate is.
  - davidw 12y ago
    This is why I flag articles about politics, and why they are considered off topic in the guidelines. This is certainly a well-written, interesting article, but the discussions it's generating are going downhill fast.
- majc2 12y ago
  I guess it depends on your definition of socialist. It's the common term thats used here - the Labour party which until recently was the dominant force in Scottish politics is a member of the Party of European Socilaists. (source: http://news.bbc.co.uk/1/hi/world/europe/8011001.stm#socialist http://news.bbc.co.uk/1/hi/world/europe/8011001.stm#socialis...) I'd argue that the vast majority of Scots would be in favour of re-nationalising both the railways and royal mail. In the case of the railways, I think there is fairly broad support across the UK for that too.
  - willyt 12y ago
    Also Railways, Post and other infrastructure are all things that make perfect sense as nationalised industries. They often end up as monopolies anyway in a free market so they might as well be state monopolies with democratic accountability.
- keithpeter 12y ago
  OK< strictly Social Democratic. But the socialist term is widely used in UK discourse. PS: When I stayed in Glasgow for a short period about 30 years ago, a 'three way fight' in a constituency was Labour, Liberal and Communist.
- louhike 12y ago
arethuza 12y ago
I can think of one particular bit of government spending that a lot of people in Scotland would be absolutely delighted to get rid of. [Hint: they all begin with V and float]
- tomp 12y ago
  What?
  - arethuza 12y ago
    Vanguard, Victorious, Vigilant and Vengeance The UK Trident submarine fleet based in a sea loch (fjord) quite close to Glasgow, the largest city in Scotland.
  - deleted 12y ago
    [deleted]
jiggy2011 12y ago
Yet the SNP wants to cut corporation tax in Scotland.

sarcas 12y ago

The issue comes down to how the money is distributed and spent. The current Scottish Government has control over something on the order of 75% of the money spent in Scotland (the other 25% coming from central government in Westminister on reserved matters like defence). Conversely, as it currently stands (ignoring the new rules from 2016), the Scottish Government only has control over something like 15% of tax raising powers (again, everything else coming from Westminster). Thus, if you were a party who wanted to promise cutting taxes to the population you could, but you'd have very little impact on the taxation's bottom line. I actually don't know what the Barnett formula says about money the Scottish government doesn't spend from Westminster (wondering if you could in theory as a party in Holyrood decide just not to spend the money you were given, as a forcing tactic). Regardless, all parties (in both London and Edinburgh) and the Scottish population are in agreement, the situation of controlling spending but not tax raising is an unfit state for a government to be in. [edit - make my 'all parties' comment clearer]

philh 12y ago
> Thus, if you were a party who wanted to promise cutting taxes to the population you could, but you'd have very little impact on the taxation's bottom line. Are we talking about the UK parliament cutting taxes, or the Scottish parliament? I get the impression that the article is talking about the UK parliament: the author is trying to explain why the Conservatives have limited support in Scotland, and why they're trying to make the Scottish parliament responsible for raising their own taxes. But if the UK parliament cuts taxes everywhere (including Scotland), and that has little effect on Scottish spending, then it seems like incentives are such that the Scottish population would most likely support that. OTOH if it has disproportionate effect on Scottish spending, they would oppose. But if I read you correctly (do I?), you're saying that's not true; and a priori I have no particular reason to expect that the effect would be small or large relative to the cut.
- sarcas 12y ago
  I was talking about the Scottish parliament. As I read it, the article talks about both (as I read it). Feels like I'm derailing the discussion a bit but essentially: Overall Scottish spending is not related to UK tax levels directly, but is directly related to spending in England and Wales[1]. So the argument is that there is little point in a party trying to get voted into Holyrood (the Scottish parliament) promising a smaller states and fewer taxes at the moment, because they have little proportionate control on the taxes (although again, on the spending they do in theory). The reverse is not true for Westminister - the more they spend in England and Wales, the more is available for Scotland to spend, and vice versa. Hope that clarifies what I was saying! [1]: https://en.wikipedia.org/wiki/Barnett_formula https://en.wikipedia.org/wiki/Barnett_formula

deleted 12y ago

[deleted]

deleted 12y ago

[deleted]

PJDK 12y ago

It's because the role of the Scottish Parliament is in deciding how a given block of money should be spent. A party that is in favour of lower taxes (and by extension lower spending) can only implement the lower spending bit - we'll cut spending and your taxes stay the same isn't much of a sell for a political party.

celticninja 12y ago

read this: http://www.futureukandscotland.ac.uk/sites/default/files/papers/Scotland%27s%20Decision%20final%20ebook.pdf http://www.futureukandscotland.ac.uk/sites/default/files/pap... there is no way they can cut taxes in the short term, not without risking the scottish economy, they may be able to offset some tax cuts at the lower rate with an increase for higher and highest rate payers. They may be able to make a smaller government that is more streamlined than whitehall however. This is not a tax based argument but basically a way of finding efficiencies in a new civil service/government that the UK parliament (as the dinosaur it is) cannot.