Briefing Note (BN157)

The Smith Commission’s proposals – how big a change do they represent? And what questions remain to be addressed?

Date: 18 December 2014
Publisher: Institute for Fiscal Studies
ISBN: 978-1-903274-71-4
DOI: 10.1920/BN.IFS.2014.00157

On 27 November 2014, the Smith Commission published proposals for further devolution of powers to Scotland. We now know what is to be devolved – the UK and Scottish Government now have the more prosaic task of implementing the changes. Getting the details of how the taxes and welfare are devolved will be crucial. In this Briefing Note, funded by the ESRC through Centre for Microeconomic Analysis of Public Policy at IFS, we analyse some of these ‘technical’ issues (and critically appraises the Smith Commission proposals more generally). In it we suggest a solution to one of the most difficult issues the Commission did not tackle – how to adjust the block grant given to Scotland when more taxes and spending are devolved. We also question some of the recommendations of the Commission – arguing that implementing them in practice might not always be feasible or fair. This observation provides a summary of these “big issues”.