Negotiations to find a permanent model for Scotland’s funding once new powers are handed to Holyrood could again go down to the wire, the Deputy First Minister has warned.
After months of talks with the UK Treasury, John Swinney last week secured a deal on how the Scottish block grant will be adjusted once the changes come in.
But with a review of arrangements to take place after the 2021 Scottish Parliament election, a permanent deal then has to be agreed between Holyrood and Westminster.
Tory MSP Alex Johnstone pressed the Deputy First Minister if those talks could “go down to the wire” in the same way that negotiations did last week.
He asked Mr Swinney: “Are you confident the mechanism you set out will not create a situation like the one we had last Tuesday where it all goes down to the wire again?”
Mr Swinney, giving evidence to the Devolution Committee about the fiscal framework deal, said: “I certainly cannot rule out that discussions will go down to the wire. Most things, in my experience, in this type of negotiation do tend to go to the wire.
“The fact we have a relatively short window between the completion of the independent report at the end of the calendar year 2021 and the necessity for the review to be resolved by the end of the financial year 2021/22 places an obligation on both governments to come to an agreement.”
Discussions between the Treasury and the SNP administration in Edinburgh over Scotland’s future funding had been in deadlock, and were only resolved after intensive negotiations involving First Minister Nicola Sturgeon, Mr Swinney, Prime Minister David Cameron, Chancellor George Osborne and Chief Secretary to the Treasury Greg Hands.
The outcome of that deal “will ensure the Scottish budget is not a penny worse off than it would have been had these powers not been devolved” up until April 2022, Mr Swinney said, when the two governments must then “jointly agree the method” for calculating the block grant.
Mr Hands said the “historic deal will pave the way for the Scottish Parliamentto become one of the most powerful and accountable of its kind in the world”.
Giving evidence to Holyrood’s Finance Committee, he said: “As Lord Smith of Kelvin said himself last week, the agreement between the Scottish and UK governments sees the recommendations of the Smith Commission delivered in full.”
Independent MSP Jean Urquhart asked Mr Hands to stop making this “irritating” claim, insisting there are other more powerful devolved legislatures in the world.
She said: “Very early on in your opening remarks you made the statement that Scotland, with these new powers, and I paraphrase, becomes one of the most powerfully devolved governments in the world.
“That is patently not true.
“Will you stop using the phrase because it’s really irritating when it’s simply not fact.”
Mr Hands said: “Well, okay, we can have a disagreement about this.
“What I would say is, even if we weren’t to agree on that, I think we would say that through the Scotland Bill going through at the moment, and the fiscal framework, the Scottish Parliament will become a lot more powerful and a lot more accountable.
“I think if you and I can at least agree on that… and really I think the accountability, by the way, is also incredibly important in terms of increasing accountability to taxpayers, which is one of the points behind tax devolution in the first place.”
Ms Urquhart said: “I don’t doubt there are merits in the arrangement, but it is not the most devolved regional government in the world.”
Mr Cameron had pledged “to create the strongest devolved government anywhere in the world, with important powers over taxation” in his victory speech following the 2015 general election.