The Disraeli Moment

The Scottish Conservatives have had their Disraeli moment. Just as the great Victorian prime minister embraced the democratic principle in 1867 and made the Tory party a powerful electoral force, Lord Strathclyde has now dispelled decades of Tory scepticism towards devolution. His report calls for greater income tax powers for the Scottish Parliament than those proposed in the Scotland Act 2012. This means being able to set income tax rates without the paralysis of the lockstep measure. Labour have also put forward their proposals for greater Scottish powers in the case of a ‘No’ vote in September, but it is the Conservatives that have broken into new ground. In time it could transform Tory futures in Scotland and be a singular service to the people of Scotland. 

Right-wing papers have on the whole shown support for the proposals in the Strathclyde Commission’s report. The Daily Mail called the move by the Scottish Conservatives and David Cameron “shrewd” and suggested that these calls could save the Union. The Prime Minister wrote a piece for the Scottish Daily Mail, in which he says that the “Strathclyde Report is a clear, coherent and Conservative blueprint for the next stage of Scotland’s devolutionary journey.” The Times echoed these sentiments, also stating that these proposals offer the “best of both worlds” and could “strengthen not just the Scottish Parliament but the Tartan Tories” too. The Telegraph was not quite so enthusiastic, positing that a debate should be held first as this would be the fairest course of action. This was, however, offset by the mighty Financial Times, which said that this new Conservative offer “deserves wide political support.”

The report has gained immediate traction. Tax is the core fiscal responsibility, and it is time for the devolved institutions to stop being “pocket-money” parliaments and accept such responsibility, as Ruth Davidson – the Scottish Conservatives’ leader – so aptly put it. This follows a core Conservative principle: those in charge of spending public money should also at least raise some of it. By generating its own revenue, a nation’s decision-makers are more accountable for the public services that they provide. Greater income tax powers could also allow Scotland to think entrepreneurially, in that they could be used to attract people to live and work in Scotland – a by-product of this being an increase in tax revenues. This should not be viewed as a threat to England, but as a way of increasing economic vitality. Competition is good, after all. 

And to fully secure a new fiscal age for the UK, Wales needs to respond. Now that the Scottish Conservatives have received the blessings of the Prime Minister, Welsh Conservatives must likewise push for the ability to set income tax rates and bands with greater flexibility. It is particularly important that changes to the Wales Bill are made if Scotland receives these new tax freedoms, as failing to do so would leave Wales disadvantaged in what would be a more competitive tax environment. The UK Government has moved on from the Scotland Act 2012 – it should likewise amend the Wales Bill.

This may be hard for many Welsh Conservatives to accept. It takes courage to propose a major reform one originally opposed. But the Scottish Conservatives have boldly placed themselves ahead of the game. We must do likewise in Wales. The lockstep measure was always a clumsy device designed to make tax powers inflexible and difficult to use in an enterprising fashion. Let us not forget the device was invented by Labour! The strongest safeguard in the Wales Bill is that a referendum is required to activate the tax powers. That safeguard enhances Welsh democracy whereas the lockstep compromises it.

Occasionally politics raises to statecraft. Such an opportunity has now arrived in Wales. Welsh Conservatives need the vision to see a balanced and strengthened Union. And a Union in which the Conservatives could hope to govern in Wales and Scotland.