Earlier this week, the UK and Scottish Governments finally agreed the now-infamous 'fiscal framework'.
The framework will underpin the devolution of income tax and other revenues to the Scottish budget, by determining how the Scottish block grant from the UK Treasury will be reduced to take account of the new revenue streams to be devolved to the Scottish Government under the Scotland Bill. The framework itself has now been published, and is available here. For some analysis of the negotiations and their outcome, see here and here.This means there should now be no concerns that the Scottish Parliament might refuse to consent to the devolution of powers set out in the Scotland Bill, which we can therefore expect to be enacted in the near future (and certainly in time for the parties to say how they will use the new powers in their campaigns for May's Holyrood election). For a reminder of the key changes to be made by the Bill, see our previous posts on the Smith Commission (here, here and here), the draft legislative clauses and the Bill itself. For more detail on the tax issues, see our Tax team's posts here and here.
Subsequent reports have confirmed that the Parliament's new income tax powers should come into force in April next year, with Air Passenger Duty being devolved the year after. However, the allocation of a share of VAT receipts will not happen until 2019/20, and it seems it will also be some time before the new welfare powers take effect.
Amendments to the Scotland Bill have been few and far between since its introduction (you can find the various versions of the Bill here), which is why we have not really added to our original posts. However, one area where there has been some development is the proposal to give the Scottish Government control over Employment Tribunal proceedings in respect of Scottish cases (though without devolving the substance of employment law). A draft order that would give effect to that proposal was published last month, and you can find our Employment team's thoughts here and here.
One other amendment that was agreed just this week will confer additional new powers on the Scottish Parliament, this time to regulate vehicle parking (as an exception to the general reservation of road traffic law). It seems this issue has caused some consternation in the past, with the Presiding Officer having refused to certify the competence of Scottish Parliament Bills seeking to regulate double parking and parking on pavements. While hardly an earth-shattering constitutional development, this is in fact a good illustration of the many small and undramatic ways in which devolution has been extended since the Parliament's establishment in 1999.
That amendment was agreed at Report stage in the Lords, which it is due to complete on Monday (in an extremely rare occurrence, the Lords' proceedings were automatically adjourned at 11.52pm on Tuesday evening due to the House being non-quorate because fewer than 30 Lords had voted in a division - see here and scroll to the end). It will then have its Third Reading, after which it will return to the Commons for approval of the amendments made in the Lords. With the Scottish Parliament due to turn into a pumpkin dissolve at midnight on 23 March, the Scotland Bill should become an Act just in time for the election campaign.
We will be monitoring what the parties propose to do with the new powers, so stay tuned for updates on that.
