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Fundamental battle lines

Brian Taylor | 14:21 UK time, Tuesday, 24 February 2009

Quite a bit more today anent Holyrood's financial powers.

Firstly, John Swinney has for change.

And the conclusion? That independence is the berries.

That it far outpaces the sundry proposed reforms of devolution in terms of enhancing the economy.

I would imagine that you are less than shocked at that disclosure, given that Mr Swinney's driving ambition is to secure independence for Scotland.

However, to be fair, the document does not simply jump to the conclusion. It steers there elegantly via a pretty comprehensive analysis of the alternatives.

We have here, in outline, the submission Scottish Ministers are now pledged to send to the Calman Commission.

Supremely relaxed

Which brings us to today's second development. Labour in Scotland has published its response to the self-same commission.

They're relaxed about borrowing powers for Holyrood. Indeed, Andy Kerr, their finance spokesman, appears supremely relaxed on that topic. (Some MPs muscles may be a little more rigid.)

They believe, in short, that Calman should now look seriously at borrowing: including how the money would be repaid.

On powers, they're largely content with the 1999 settlement. (Author: the Labour Party.)

But they believe Calman might care to look at an enhanced role for Holyrood in the operation of the Health and Safety Executive plus Gaelic broadcasting.

Contrary to some internal prompting, they do not want any powers returned to Westminster - including re energy.

Instead, they want enhanced co-operation between Edinburgh and London. Indeed, that is a core theme.

To return to the Swinney document. Remember this is a government, not party, publication.

Indepedence argument

Self-evidently, it is driven by ministerial aims: aka, independence.

But it also contains fascinating analysis of the alternative options. Perhaps, in addition to ministerial control, one can detect evidence of civil service input here, with an eye to that wider debate.

One can see issues here being drawn to the attention of London, quite distinct from the over-reaching indepedence argument.

So we have a warning re the possible impact of a needs review of Barnett: this could lead, we are told, to "potential real cuts in funding" for Scotland. Translation: Scotland is ready to fight in any Treasury-led review.

On assigned revenues - the concept of collecting taxation in Scotland without the power to vary it - the document is notably cool.

The document doesn't discern any evidence that this would create an economic growth incentive. To the contrary, it's described as "Barnett with greater uncertainty and volatility".

So that would be a no, then.

'Significant step'

By contrast, there is a notable warmth shown to the concept of "devolution max" - whereby Scotland would raise and control most taxation, while sending a subvention to London for shared services like defence.

Barnett in reverse, if you like.

This, says the document, would be a "significant step forward". It concludes: "Short of independence, this option would create the maximum policy discretion for the Scottish Government to increase sustainable economic growth."

In interviews, Mr Swinney has, of course, stressed the value of independence - while noting the emergence of a tentative consensus on issues such as borrowing powers.

Just possibly, he is gearing up to bank what he can.

Let's not kid ourselves. Nationalists and Unionists remain fundamentally at odds. They do not agree. However, there is now an intriguing territory upon which to stage a debate, aside from those fundamental battle lines.

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