1st Ld Writethru: British PM vows to strengthen Scottish parliament with new devolved powers

British Prime Minister David Cameron on Thursday published plans giving the Scottish parliament new devolved powers.

The new powers will give Scotland the power to set income tax rates and tax bands, but not to alter the threshold above which tax is paid.

It also proposes a proportion of value-added tax (currently set at 20 percent) levied in Scotland to be assigned to Holyrood.

The Scottish Parliament will win the power to fix its own air passenger duty, something causing worry at Britain's third biggest airport, Manchester over the border in North West England.

Cameron met Scottish First Minister Nicola Sturgeon at the Holyrood Scottish parliament Thursday. In his speech delivered in Edingurgh, Cameron defended the decision to hold the Scottish independence referendum on Sept. 18 last year, noting that "Scotland spoke and we listened, so here we are delivering our vow."

The Smith Commission established after the referendum recommended the Scottish Parliament be given the power to set income tax rates and bands, but not to alter the threshold above which tax is paid.

The Commission recommended the devolution of a range of benefits to support older people, care-givers and disabled people and said the parliament should be able to create new benefits in devolved areas and make discretionary payments in any area of welfare.

However, Sturgeon said the proposals published on Thursday gives the British government a veto over key devolved powers, including the ability to "abolish the bedroom tax," calling for an urgent rethink of what was on offer.

She noted that aspects of the legislation represented progress but proposals in areas such as welfare, employment support and capital borrowing appeared to be a "significant watering down" of what was promised by the Smith Commission.

The message from Cameron was the new powers offered to Scotland were "built to last," making Holyrood, home of the Scottish Parliament, "one of the most powerful devolved parliaments in the world."

Even before the ink was dry on the new bill, the Scottish Nationalist Party (SNP), that currently rules Scotland, said the provisions did not go far enough, and that they wanted more powers than those on the table.

Scotland's First Minister and SNP leader Nicola Sturgeon said it was a "significant watering down" of what had been promised.

The publication Thursday came because of a promise that new legislation to pave the way for greater powers for Scotland would be presented before Burns Night.

The bill will not become law until after May's British General Election, and between now and then there will be extensive debates by politicians on both sides of Hadrian's Wall, the stone barrier built to separate Scotland and England.

Much of the debate will center on the impact of the new powers for Scotland on England and Wales. Currently, Wales has its own elected assembly, essentially a half-way house between home rule and specified devolved powers within the Principality of Wales. The message from the Welsh valleys will be more powers for Welsh people.

The big battle grounds, though, will be in the English Regions, particularly in the North West and North East which border Scotland.

The North West, which spans the western side of England from the Scottish border to the Welsh border, has a population of more than 7 million, almost 2 million more than the population in Scotland.

Politicians in the North West have already expressed concern about the potential impact on its region once Scotland, its next door neighbor, is given its own tax raising powers. Currently, taxes for Britain are decided in Westminster, and a variation could influence decision-making by major businesses.

Another big concern is the legal right of members of parliament for Scottish Constituencies to be able to vote on laws and issues affecting England, whereas English MPs will have no say on decisions affecting Scotland.

By convention, the Scottish National Party has said its policy is not to vote on England-only matters coming before the British Parliament.

But just this week, First Minister Sturgeon announced the SNP would vote on matters affecting the English National Health Service because of the potential impact decisions about the NHS could have on Scotland.

Published in advance of Sunday's Burns' Day deadline, the draft legislation would turn the Smith Commission agreement into law.

After the general election in May, the next British government will actually deliver the new devolved powers to the Scottish parliament. The Conservatives, Labour Party and the Liberal Democrats all committed to doing so.

The ruling Scottish National Party said if they hold the balance of power at Westminster, they would use it to push for even greater devolution, with recent polls suggesting the party could win more than 40 seats. Endit