I have received no representations from the Scottish Executive in relation to the arrangements for collection of local income tax.
I thank my right hon. Friend for his answer. Does he share my concern that the Scottish National party Administration’s plans for a local income tax in Scotland appear to bring 55,000 students within the ambit of local income tax for the first time?
Another flaw in the SNP local income tax policy is uncovered daily, and this particular one relates to the policy’s alleged fairness. An answer to a question in the Scottish Parliament revealed that 55,000 students would be brought into paying local income tax. Of course, all those students are exempt from paying council tax. I have a series of quotations from student leaders indicating how unfair the policy would be, but I think that we all know how unfair it would be. It is bad enough that we did not know that it would affect those students, but we do not know how the money would be collected, and those are only two of several major flaws in the plans for local income tax.
On local taxation in Scotland, the Secretary of State will know that the UK Government confirmed in 1997 that council tax benefit would form part of the Scottish block. That was repeated in the funding statement published by the Government in October 2007. Will the right hon. Gentleman confirm that if the Scottish Government proceed with changing the nature of local taxation in Scotland, this Secretary of State will hold fast against the Treasury and ensure that the UK Labour Government do not denude Scotland of the £400 million that it gets to offset local taxation in Scotland?
To all but a very small minority of people, it appears quite clear that if there is no council tax, there is no need for any council tax benefit. The SNP’s fundamental problem with the policy—there are many other problems—is that it promised the people of Scotland that it would unveil a tax system that would be fair, but it has unveiled a tax system with a number of manifest unfairnesses, and it is seeking to cover them up by trying to access a benefit that relates to the taxation system that it said was unfair and that it wanted to remove. That does not make any sense.
I share the concerns of my hon. Friend the Member for Falkirk (Mr. Joyce) about the effect on students in Scotland. When my right hon. Friend the Secretary of State next meets the First Minister, will he get clarification of whether the policy will affect English students studying in Scotland or Scottish students studying in England?
I will of course seek to clarify that issue for my hon. Friend. The fundamental problem faced by the SNP with its proposal for a local income tax—it would certainly not be local, of course, having been fixed centrally—is that we have revealed this week the flaw that it will affect 55,000 students. The SNP must explain why that manifest unfairness will be imposed on students, whom it was elected to help support.
The Treasury, no doubt in consultation with the Justice Secretary, has said, along with several legal experts, that a tax that is set and collected on a Scotland-wide basis would not be sufficiently local to remain within the powers devolved to the Scottish Parliament. Does the Secretary of State thus intend to make a formal legal assessment of the competence of the Scottish Government’s proposals, or does he propose to leave it to aggrieved taxpayers to test them in the courts?
I am sure the hon. Gentleman knows that we have not yet seen the legislative proposals. I am not surprised that the SNP Executive are having such difficulty in drafting and revealing them because another problem becomes apparent every week and every day. When we eventually see the proposals, there will of course be an assessment, as is the case with all legislation, to ensure that they are compatible with the devolution settlement.
I thank the Secretary of State. He might be aware that Professor Alan Page, a professor of public law at the university of Dundee, has said of the SNP’s proposed local income tax:
“It is inevitable that the matter would end up in the courts; it is unavoidable…The question of legality will cast a long shadow over the proposal until it is settled one way or another.”
As the guardian of the devolution settlement, does the Secretary of State not believe that he has a responsibility to help to settle the matter?
Of course I have responsibilities in relation to the devolution settlement; they are set out in law, and I intend to fulfil them. In my experience of practising law, it is always unwise for a person to anticipate what they will be asked to express a legal opinion on, and if one asks five lawyers for a legal opinion, one gets six different opinions. In my position as Secretary of State for Scotland, with those responsibilities, it seems wise to wait to see the legislative proposals. I have, in the Advocate-General, access to one of the leading lawyers in Scotland. I rely on his advice regularly. He will give me advice, and if it is necessary for me to act on it, I will do so.