The phrase ‘Britain will never be the same again’ is overused. But today its use is justified. The Smith Commission proposals on further devolution for Scotland are a huge step towards a federal United Kingdom. All income tax, with the exception of the personal allowance, will be devolved to Scotland—so north of the border there could be different bands and rates.
With more devolution to Scotland, the West Lothian question becomes more acute. So, David Cameron has been quick to stress this morning that he will bring forward his proposals on English votes for English laws before Christmas.
The fundamental question is whether this move to federalism will save or destroy the Union. On balance, I’m hopeful it will save it. What has become clear over the past few years is that the status quo was not an option: the 1999 devolution settlement was killing the Union. But this move towards a more federal UK must be accompanied by a greater emphasis on our shared British identity.
UPDATE: It is already becoming clear where the political argument will be, will Scottish MPs still be able to vote on income tax for England and Wales? Now, the rub is that elements of income tax will remain a UK-wide issue—eg income tax on savings—so Scottish MPs should still be entitled to vote on these measures.
But it would be hard to defend Scottish MPs voting on the elements of income tax that have been devolved to Holyrood. For Labour, though, this is essential for without it they would find it far harder to command a stable UK-wide majority for their future budgets.
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