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Baroness Ramsay of Cartvale: My Lords, I appreciate the points that the noble Lord, Lord Mackay of Ardbrecknish, has made in presenting the amendment. I am familiar with his thinking from what he said in Committee. As we see it, the noble Lord's current amendment contains three separate themes. I think it might be helpful, therefore, if I were to deal with each of those themes in turn.

First, the amendment proposes that Scottish legislation will provide that the Comptroller and Auditor General should be given the power to direct the form and, in effect, supervise the preparation of the accounts of the Scottish executive and other persons receiving money directly from the Scottish Consolidated Fund. We do not believe that that would be appropriate.

It will be the right and privilege--indeed, the duty--of the Scottish parliament to hold the Scottish executive to account. That is one of its primary roles. It must, therefore, be for the parliament to decide the detail of how the executive should account to it. Clause 66 is not intended to be exhaustive. It sets out a framework for the accounting by the executive to the parliament. The parliament itself will legislate on the detail, including the form of the accounts and the standards to be applied or how they are to be prescribed. As the noble Lord knows, we have set up a committee of financial and other experts--the Financial Issues Advisory Group--to advise the incoming parliament and executive on these matters. That group will be making proposals on the content of the annual accounts of the executive.

The accounts will be audited by the Auditor General for Scotland or auditors appointed by him. The auditors will be independent of direction both of the executive and of members of the parliament. They will be bound by their own professional standards and by those laid down by such as the Auditing Practices Board. Of course, the auditors' reports must be published.

Secondly, the amendment proposes that Scottish legislation must provide for the designation of accounting officers. We find this part of the amendment a little difficult to understand, as Clause 66(1)(e) does precisely that. It does not use the term "accounting officers"; but that is exactly what it means.

This particular provision serves two important functions. First, it gives the parliament direct access to officials on the detail of the executive's actions in undertaking expenditure. It also gives those officials a standing separate from that of their ministers--a useful safeguard for the parliament in the checks and balances required in operating any such system.

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Thirdly, the amendment deals with the position of other bodies; that is, bodies not receiving money directly from the Scottish Consolidated Fund. If any body receives money directly from the fund, Clause 66(1) and (2) already apply. Moreover, Clause 66(4) already makes it clear that the parliament can make further provision for ensuring the accountability of others receiving sums derived from the Scottish Consolidated Fund. The bodies to which this amendment would apply are those which will be funded, or partly funded, by the Scottish ministers. That would include such bodies as local authorities, health service bodies, non-departmental bodies set up under statute and further education colleges.

We believe that there may be some misunderstanding here. The existing legislation under which these bodies operate will remain in force. That includes the accounting and auditing provisions of that legislation, save that Scottish bodies currently audited by the Comptroller and Auditor General will in future be audited by the Auditor General for Scotland. In view of those explanations, I hope that the noble Lord will find it possible to withdraw his amendment.


Lord Mackay of Ardbrecknish: My Lords, I am grateful to the noble Baroness for those comments. I certainly think that as regards the final part of my amendment she has probably said sufficient to allay my concerns. Indeed, I think the same is true as regards paragraph (b) of my amendment, although those people who are much more involved in this kind of work than I will probably want to cast an eye over what she said. I understand and appreciate her arguments in as far as I have followed them.

I am still just a little unsure, however, about how the spending of public money will be overseen by an auditor or by the Public Accounts Committee. I refer to the £14 billion of expenditure which will go from the other place--it is the House of Commons not the Treasury which votes supply--to the Scottish parliament and the Scottish executive. I come back to the point that this large tranche of money will, I suspect, be the only tranche of money which the House of Commons will vote upon but will not oversee. That is what bothers me. I do not particularly want the House of Commons to do the checking, but I want it, through the Public Accounts Committee or the Comptroller and Auditor General, to have some locus in making sure that the systems set up by the Scottish parliament are adequate.

However, I can see that I shall not make any progress on that, but it is a problem and I rather fear that at some time in the future the other place might get "stroppy" about it and someone might ask, "Why have we absolutely no way--through the Public Accounts Committee or the Comptroller and Auditor General--of ensuring that the £14 billion is properly spent?" In some ways I am trying to take out an insurance policy against that day, but I accept that it is perhaps rather late in the day to be taking out insurance policies in these matters. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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The Deputy Speaker (Baroness Turner of Camden): My Lords, I must inform the House that in the second Division this evening the number who voted Content was 38 and not 37 as announced.

Lord Sewel moved Amendment No. 150A:

Page 29, leave out lines 4 and 5.

On Question, amendment agreed to.

Lord Sewel moved Amendment No. 150B:

Page 29, line 9, leave out from ("any") to end of line and insert ("other").

On Question, amendment agreed to.

Lord Sewel moved Amendment No. 150C:

Page 29, line 19, at end insert ("and "other legislation" means provision made by any other enactment").

On Question, amendment agreed to.

Lord Rowallan moved Amendment No. 151:

Before Clause 69, insert the following new clause--

("Power to impose levy
Power to impose levy on Scottish taxpayers

.--(1) The Parliament shall have the power to impose on persons resident in Scotland a levy of up to three pence in the pound on those persons' income, net of income tax.
(2) A person is resident in Scotland within the meaning of subsection (1) if he owns or rents his primary dwelling place in Scotland.
(3) The Parliament shall only exercise the power referred to in subsection (1) if it passes a resolution to that effect.
(4) The Secretary of State may by order make further provision about the levy.
(5) An order under subsection (4) shall not be made unless a draft of the order has been laid before both Houses of Parliament and approved by resolution of each House.").

The noble Lord said: My Lords, this is a probing amendment, along with Amendments Nos. 152, 153,155 to 159 and 231. I realise that I am going right into the Holy Grail here in this amendment and that I risk the wrath of those who drew up the White Paper, the referendum and the Scottish Constitutional Convention. I am sure also that the noble Baroness, Lady Ramsay of Cartvale, and the noble Lord, Lord Steel of Aikwood, are both looking at me with astonishment. However, I want to probe the Government on several problems that have arisen.

The first problem as I see it concerns residency. We have heard the story of English based lorry drivers who will be deemed to be Scottish taxpayers, whereas Scottish lorry drivers may not. We have heard about people who use the Stranraer ferry who spend more nights in Scotland than in Northern Ireland even though they live in Northern Ireland.

Raising money through the income tax system would also cause problems. Those working for a firm which has one factory in England and another in Scotland will receive different sums of money. The trade unions will become upset about that. At the end of the day it will probably be the Scottish employer who will pay for it.

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In Committee, the noble Lord, Lord Sanderson of Bowden, referred to the idea of a levy. I wondered how sensible or silly an idea it was. It amounts to tax gathering rather than tax collection. Approximately 50 per cent. of Scottish voters are taxpayers. We have been told that that would approximate to an average payment from each taxpayer of £200, with a maximum of £600.

If every one of the 4.2 million voters paid, and £430 million was to be raised, each taxpayer would pay just over £100. Thus accountability would be assured. I must admit that I have always been slightly against people having a vote on other people paying taxes when they do not pay themselves.

This is a probing amendment. I have not thought through the method of raising the levy. However, I seek an opinion from the Government as to why they went down the income tax route rather than proposing a general levy. It seems to have caused a large number of problems which are becoming manifest as we progress through the Bill. I look forward to the Minister's reply. I beg to move.

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