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23/10/2014


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The Scottish parliament. nike roshe run mid womens Potentially important differences remain between the pro-union parties on further powers. Photograph: David Cheskin/PA

The Smith commission, which was set up to fast-track further powers to Scotland after the country rejected independence in last month’s referendum, will hold its first full meeting on Wednesday.

The commission’s chairman, Lord Smith, will meet previously announced representatives of Scotland’s five main political parties at the Green Investment Bank in Edinburgh at 2pm.

The SNP, Labour, Conservatives, Liberal Democrats and Scottish Green party have all submitted their individual proposals for extending devolution. The SNP has called for maximum devolution within the UK, including full control over tax and fiscal policy, while the pro-independence Greens have likewise called for more radical economic powers, including over borrowing as well as taxation.

Potentially important differences remain between the pro-union parties on further powers. Labour has called for the Scottish parliament to raise 40% of its own budget and increase the top rate of tax, while the Conservatives want Holyrood to have complete control of the rates and bands of personal income tax.

At their conference in Glasgow earlier this month, senior Lib Dems suggested they would support Labour’s proposal for devolving control of housing benefit if Labour sanctioned a cross-party deal on complete control of income tax, which both Gordon Brown and Ed Balls are known to oppose.

Speaking before the meeting, Smith said: “Having spoken to all of the parties individually, I believe the will is there to reach agreement.”

“Today’s talks give them the chance to sit down around the table together, find common ground and begin the process of delivering what the people of Scotland expect – a substantial and cohesive package of new powers which will strengthen the Scottish parliament within the UK .”

Smith plans to publish heads of agreement by the end of the November, with draft legislation to be put forward by the UK government by the end of January.

On Tuesday, the Fiscal Affairs Scotland thinktank said Scotland could face a deficit of up to £5bn if full fiscal autonomy was devolved to Holyrood.

Publishing an analysis of the latest North Sea oil and gas revenues, director John McLaren, a former Treasury economist and Labour special adviser, said: “The Smith commission needs to take into account the potential impact of continuing relatively low levels of North Sea revenues on Scotland’s budget, if North Sea revenues are to be part of any negotiated package.”

“Our calculations suggest that, across a wide range of assumptions, full fiscal autonomy could lead to a significant shortfall in funding over what the current system delivers.”