Agreement on fiscal framework looks like Davidson proposal

[Updated below, 10.30 24th February]  The UK and Scottish governments have finally agreed a six year beginning for the fiscal framework which will detemine the adjustments to the annual Scottish block grant to take account of the revenue outcomes from the major fiscal powers to be devolved to Scotland.

What has been agreed looks very like the deadlock breaker proposed by Scottish Conservative Leader, Ruth Davidson who, on 17th February, proposed that the governments agree to use a recently revised model for the fiscal framework for an initial period.

In return for agreement, the UK Government would guarantee that whatever happened with Scottish revenue raising or not over that period, the UK would make up any shortfall so that Scotland would receive, in Ms Davidon’s words,  ‘not a penny less’ in its block grant – a phrase which First Minister, Nicola Sturgeon, repeated today in her briefing of MSPs on the development.

Ms Davidson proposed that the performance of the this trial framework would be reviewed by both governments after a five year period. This has seen a further concession from the UK Government  – with a six year and totally risk free period for Scotland to settle in using the new powers, before the Review which will be in March 2022.

The agreement made sounds, in total, very like the Davidson formula.

Chancellor George Osborne has said that the agreement will see the intentions of the Smith Commission delivered in full.

Ruth Davidson says: ‘Today’s agreement delivers the stronger, more responsible Scottish Parliament that the people of Scotland were promised.

‘It is devolution delivered.

‘It delivers on exactly the kind of Scotland that most people want – not separated from our neighbours, but a Scotland with more power and control over its own affairs, still backed up by the strength and security of the United Kingdom.

‘I am very proud of the role my party has played in making this vision a reality.

‘It was the Scottish Conservatives who set out the plan for devolution – now it’s a Conservative government at Westminster which has acted on that.

‘I congratulate both our governments for reaching this deal today.

‘It has not been easy and compromises have been required by both sides but today’s deal shows that our two governments can work together for the good of Scotland.

‘In the longer term, it now throws a major challenge to the SNP.

‘Grudge and grievance will no longer wash.

‘On tax, on welfare, and on our public services, the buck stops with them.

‘For my part, I stand ready to provide the strong, principled opposition to the SNP that is now required more than ever as these new powers come to Holyrood.

‘We will protect family finances and we will demand that the SNP uses these powers to take Scotland forward – not back to yet another referendum.’

Update 24th February: There has been another concession from the UK Government in the final agreement made. The UK is to contribute £200 million to the set up costs of administering the new powers. Our information was that the last offer from the Treasury had been £100 million, so the final £200 million is another major concession.

The UK taxpayer is effectively paying for Scotland to have six years, risk free, with no accountability, to learn to manage its own income tax and welfare; and is paying heavily towards the set up costs of the Scottish systems.

The question has to be asked, what, in the end, is the overall advantage to the rest of the UK?

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Related Articles & Comments

  • Nothing of note happened today.
    The fiscal framework is inert without full fiscal levers.
    We can now alter road signs !!!
    The main deal has been kicked down the road until 2021 when,by that time,Scotland will be Independent.
    As for Woofie Tank Commander being the Hero of the Day,give us a break!!!

    Hot debate. What do you think? Thumb up 4 Thumb down 16

    Hugh Jazz February 23, 2016 7:49 pm Reply
    • HJ, Westminster delivered and your leader accepted.
      Now get on and Govern!

      Hot debate. What do you think? Thumb up 13 Thumb down 6

      Richard February 23, 2016 8:27 pm Reply
      • I’m making sign posts as I write.
        You won’t like them Dick!!

        Like or Dislike: Thumb up 2 Thumb down 12

        Hugh Jazz February 23, 2016 8:34 pm Reply
        • HJ, you must be feeling sick with your leader accepting this as a fair agreement and now your going to be campaigning alongside Cameron or maybe Ruth to stay in the EU, here’s where to go and get yourself a big blue rosette.

          Hot debate. What do you think? Thumb up 11 Thumb down 6

          Richard February 23, 2016 9:05 pm Reply
          • Dick,go ……….. And ………when you do that……………Tory’s are………. ………..
            And Liebour can go and………………as well.
            I don’t have anything to add about the Libdums ,ah,…………….too.
            Independence by 2019

            Hot debate. What do you think? Thumb up 3 Thumb down 12

            Hugh Jazz February 23, 2016 9:19 pm
          • HJ, you seem very touchy, maybe you can help out with some support and advice to Mr Lochhead before he manages to bankrupt Scotland’s farmers and crofters.
            You said you were making signposts so I’m sure he would appreciate being pointed in the right direction and in exchange update you on the EU fisheries policies.
            What’s it feel like to realise your a frustrated unionist?

            Hot debate. What do you think? Thumb up 13 Thumb down 7

            Richard February 23, 2016 9:33 pm
    • Hey Jazzie boy, while you’re busy making road signs can you get rid of all those useless garlic road signs the SNPEEEEE have stuck all over Argyll and beyond?

      Like or Dislike: Thumb up 0 Thumb down 0

      Sian Laidlaw February 25, 2016 10:37 am Reply
  • No detriment means no detriment. That was the vow. That was the promise. Doesn’t seem much of a promise now, despite what Davidson tries to say. Time to cut the crap. Full fiscal powers is the way.

    Hot debate. What do you think? Thumb up 4 Thumb down 13

    willie February 23, 2016 8:35 pm Reply
    • That wasn’t the vow willie, so why not take a bit of your own medicine and cut the crap. Why lie?

      Do you even know what the vow was? I highly doubt it. What ‘promise’ do you refer to?

      You and your type – whinge, moan, carp from the sidelines. No wonder Scotland is not really going anywhere – too many people like you about.

      Hot debate. What do you think? Thumb up 10 Thumb down 6

      JB February 23, 2016 9:08 pm Reply
    • Richard February 23, 2016 9:43 pm Reply
  • I ask a question last night bot no answer. I am French and wel I get booted out of Scotland if ther is Bretex.
    I have just bought big land in Mull and am worried.I have just met the love of my live,a big wel bilt Scots las with much ample. I would be so sad to be booted so please vote non.

    Like or Dislike: Thumb up 11 Thumb down 2

    Sacha Distillery February 23, 2016 8:40 pm Reply
  • Looks like a recipe for another referendum in 2021 then.

    Like or Dislike: Thumb up 3 Thumb down 6

    jake February 23, 2016 8:43 pm Reply
  • Good evening to you all.Im trying to extrapolate the consequences of the fiscal framework agreed by George Osborne and the Separatists today .Could someone throw some light as to the Tax liabilities that will be borne due to these new powers.Ill be frank and pertinent here,I really feel vexed having to pay any more to that retched Edinburgh Administration.Its bad enough having the rain almost all the time.Its costing me a fortune on Herd feed.
    Your assistance on this matter would be gratefully received.

    Like or Dislike: Thumb up 8 Thumb down 4

    R.B Stoker February 23, 2016 9:45 pm Reply
  • Hugh Jazz, can you not debate in a sensible manner. Im afraid you have become an irritation for most posters of all sides and no side. Tedious and and i would imagine an embarasment for the party you would have us believe you support.
    I have for some years now enjoyed healthy debate about many subjects on ‘forargyll’ and have until recently been generally impressed by the respect shown to posters of differing views.
    You can do better.

    Hot debate. What do you think? Thumb up 13 Thumb down 5

    phill February 23, 2016 9:45 pm Reply
    • Well said Phil. I complained furiously about that man days ago.
      I suppose that’s the price we pay for democracy.As most on here seem to be Conservatives,or so my neighbour stated,why don’t we just ignore the rantings and debate how we can up end the SNP in May.

      Hot debate. What do you think? Thumb up 10 Thumb down 5

      R.B Stoker February 23, 2016 10:24 pm Reply
  • It is noticeable that whereas HJ used to get more “likes” than “dislikes” for his posts, that situation is now reversed. Is that despite or more likely because of the number of SNP supporters posting here?

    Like or Dislike: Thumb up 7 Thumb down 4

    Alex McKay February 24, 2016 7:53 am Reply
  • HJ is an irrelevancy to FA and to the SNP

    Back to this post

    Unless the SNP officially deny it , the deal maker was the 5 yr review, proposed last week by Davidson of the Scottish Tories .

    It is well known around Holyrood that Davidson has Cameron’s ear,and Cameron listens .

    My understanding of the detail is the last-minute offer tabled by the Treasury would see the Treasury model being used but with the UK Government agreeing to reimburse the Scottish Government for any money it would have received, had its model been in place. The Treasury has also offered a review of the funding formula after five years, and if no agreement on the way forward after that 2022 review, the funding formula would continue to be based on the Treasury’s model.

    So what has been achieved?

    Like or Dislike: Thumb up 7 Thumb down 4

    SCOTNAT February 24, 2016 9:13 am Reply
    • “It is well know around Holyrood that Davidson has Cameron’s ear and the pig has Hamerons ?”

      Like or Dislike: Thumb up 2 Thumb down 10

      Hugh Jazz February 24, 2016 10:22 am Reply
      • Tell me, HJ, when are you going to man up and confess that your claim that the price of oil would be $65 by Christmas was just you bull-shitting?

        Like or Dislike: Thumb up 8 Thumb down 3

        Alex McKay February 24, 2016 2:29 pm Reply
        • I stand by the $65.
          You,stop the swearing.

          Like or Dislike: Thumb up 2 Thumb down 7

          Hugh Jazz February 24, 2016 4:08 pm Reply
  • You make it it sound like it was Ruth Davidson that came up with this idea all on her own to break the negotiation deadlock. The idea that she intervened and announced it on her own initiative during negotiations without getting the nod from Downing Street is far from credible.
    The idea did not originate with Ms Davidson, she was simply allowed/instructed by the treasury to float the idea and take the credit for it. A sympathetic Tory press have been encouraged to insinuate her influence …it’s almost as though there was an election coming up.

    Like or Dislike: Thumb up 4 Thumb down 5

    jake February 24, 2016 12:59 pm Reply
  • I’m afraid Ruth Davidson is an irrelevant side show. Her two bit cat calls are of no importance. She is in truth the monkey on the end of her Westminster masters stick. Post the May election she’ll still be the irrelevance she is today.

    Like or Dislike: Thumb up 4 Thumb down 9

    willie February 24, 2016 2:24 pm Reply
  • At 20% of the vote, the Tories under RD will not be an irrelevance. Ruth Davidson is one of the stars of Scottish politics – yiu are just too bitter and entrenched to realise. More fool you and people like you.

    It’s funny – it wasn’t so long ago that the SNP were statistically less relevant than the Tories. How did that end up for them?

    Like or Dislike: Thumb up 5 Thumb down 4

    JB February 24, 2016 3:48 pm Reply
  • Last nights political tv discussions, this mornings radio political discussions and todays press, including the right wing mob seem to agree.
    David Mundell’s interviews have been embarrassing and cringeworthy.
    SNP 1 AND 2
    We know it makes sense.
    Ruth Davidson is irrelavent. 20% ? mmmm I can’t see it

    Like or Dislike: Thumb up 2 Thumb down 6

    Keitho February 24, 2016 7:51 pm Reply
  • Hello. I write again last nite but no one repie.I bough a big land in Mull and now I find out today that my Scots girl fiend is expecting baby.I am reelly worried now that I get booted out of Scotland if you vote for Bretex.
    I can’t sleep know for the worri but I have my baby to keep me warm.Thees Scots girls are very warn.So warn I do not need quilt.
    Please vote non and keep me in Mull with my lovely ful girl.

    Like or Dislike: Thumb up 1 Thumb down 2

    Sacha Distillery February 24, 2016 8:45 pm Reply
    • In the name that all is Holy. Why don’t you just marry the girl.You French need To learn to respect woman more. French never had gentlemen,unfortunate.
      As for you staying,I couldn’t care less.
      Vote out.

      Like or Dislike: Thumb up 0 Thumb down 4

      R.B Stoker February 24, 2016 9:06 pm Reply
    • Franco-Ecossaise relationships are not always what they’re made out to be. The Scottish Labour Party fell head over heels for the young FiFi Le Bon Bon, so much so that they elected her as leader, showering her with X’s.
      Alas, it did not turn out well and now hardly anyone gives her the slightest attention and certainly no X’s.

      Like or Dislike: Thumb up 2 Thumb down 0

      Murdoch MacKenzie February 25, 2016 8:15 am Reply
  • Initially John Swinney was pressing for £600-£800 million for start up costs, so Mr Osborne has achieved a fairer settlement that some would of expected.

    After taking advice from David Phillips of the Institute for fiscal studies, (IFS) Mr Swinney has kicked the idea of full fiscal autonomy into the long grass. FFA as an economic position for Scotland would be the worst of any possible scenarios to be at. Mr Swinney may well spin the idea of FFA to the media but the reality is some-what different.

    Like or Dislike: Thumb up 2 Thumb down 3

    Adam Smith February 25, 2016 12:48 pm Reply
  • I wonder what would have been offered if the boot was on the opposite foot?

    Call me cynical, but I suspect the Scottish Government would have offered England FFA or SFA as a choice.

    Like or Dislike: Thumb up 1 Thumb down 2

    JimB February 25, 2016 2:23 pm Reply

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