Scottish MPs at Westminster will be prevented from voting on income tax changes and any other tax measures devolved to the Scottish parliament under Conservative plans to be announced on Tuesday.
The plans – to be laid out in a speech by the Leader of the House, William Hague – will also give MPs representing constituencies south of the border a complete power of veto over laws that affect only their country, so giving Scottish MPs at Westminster merely a residual debating role on such laws. The proposals go further than anything adopted by the Conservatives before but Hague will argue that his reforms “are a fundamental matter of fairness” and are necessary to prevent the weakening of the United Kingdom.
Under a cross-party deal reached in November, the Scottish parliament is set to be handed complete power to set income tax rates and bands as well as powers over other taxes and benefit measures.
The move comes as the Scottish Labour leader, Jim Murphy, accompanied by Gordon Brown, put in a counter-offer vowing to devolve more welfare policies to Scotland, including the ability to vary and top up welfare benefits.
In his speech, Hague will claim the new constitutional settlement he has chosen with the prime minister gives an effective veto to English MPs over matters only affecting England, or England and Wales, while maintaining the integrity of the United Kingdom parliament.
Hague will say: “We Conservatives believe that this principle of English consent, the English veto should be extended to taxation when the equivalent decisions have been devolved to Scotland – and under a Conservative government it will be.
“The Scottish parliament will shortly have significant new powers to set the rates of income tax, air passenger duty and the aggregates levy. We believe that the equivalent taxes in England should require the consent of English MPs.”
More broadly, Hague will say any legislation, or clauses within legislation, affecting England would be considered in committee by English-only MPs before the Third Reading of the bill, the final legislative change involving all MPs in the UK. The committee made up only of all elected MPs representing English constituencies (or, where relevant, English and Welsh constituencies) will be able to give a simple consent or veto to the legislation.
Hague said the procedure would ensure the wishes of the English, or English and Welsh, cannot be overridden by Scottish MPs. A bill could not pass to third reading, the final parliamentary stage, without passing the consent stage. Some English Tory MPs would have liked Hague to exclude Scottish MPs from all parliamentary stages, but his proposal nonetheless leaves them on the margins.
He will say: “How could it possibly be right for the Scottish parliament for example, to vote for a reduction in air passenger duty in Scotland and then for Scottish MPs to come to Westminster and be able to impose an increase in air passenger duty in England? You only have to think about this for a moment to see how fundamentally important this is and how such issues have to be addressed. Under our proposal this would not be possible without the agreement of English MPs.
“This will mean that the rates of income tax and air passenger duty in England will be voted on by all members, but can only be passed with the majority of the English members voting in favour and therefore also subject to an English veto.
“Some people will argue that this will weaken the United Kingdom, but I say that failure to act would be the true weakening of the United Kingdom. There is room in this remarkable, diverse and democratic country for the rights of all voters and their representatives to be properly balanced and represented and to evolve over time”.
He will deny his plan represents a breakup of Britain, or will effectively preclude an MP from a Scottish seat being appointed chancellor of the Exchequer.
He will say all MPs will “continue to vote on every aspect of the UK budget: it would continue to be considered as now, including in a finance bill committee. There would be no issue with the chancellor of the Exchequer representing a Scottish constituency. But where taxes have been devolved to Scotland the equivalent taxes in England would require the consent of English MPs.”
The proposals put the Conservatives on a collision course not just with Labour but also the SNP. The SNP leader, Nicola Sturgeon, has said she wants Scottish MPs to vote on all legislation in future, including those that affects only England and Wales.
Labour in Scotland promised it will devolve a “wider power” to vary and top up welfare benefits, powers to create new benefits, “fully devolve housing benefit” and devolve welfare to local communities.
Brown told an audience in Edinburgh, “It’s time to build on the vow.”
Murphy said the additional powers proposed by Labour could make Holyrood the world’s most powerful devolved parliament.
He said the proposals would also help tackle the challenge of inter-generational disadvantage and poverty.
He said: “We achieved a lot the last time we were in power – the national minimum wage, the working tax credits, investment in our NHS – all about driving life chances and changing people’s lives for the better.
“But we have to go much further. My sense is that there is a chain of disadvantage that stretches across families and each successive generation of that family is another link in that chain of disadvantage that’s passed from one generation to the other.”
