The UK Government is being pressed to hold “substantial and serious” discussions with Holyrood ministers over the devolution of more powers to Scotland.
Scottish Deputy First Minister John Swinney called for talks between the two administrations to take place after Conservatives confirmed they would reject SNP proposals for full fiscal autonomy.
Scottish Secretary David Mundell has branded that proposal a “full fiscal shambles” which would cost families in Scotland £5,000.
With the Scotland Bill, which will hand MSPs new responsibilities over income tax and welfare, being debated in the House of Commons today, Mr Swinney again called for the legislation to be strengthened.
He said there were “real concerns about the coherence” of the current package of measures in the Bill, as he added SNP ministers would be “pressing the UK Government for substantial and serious discussions”.
With the UK Government opposed to full fiscal autonomy, nationalists have said their priority is to secure additional powers beyond those already recommended by the Smith Commission, including business taxes, employment law, minimum wage, further welfare powers and equality law.
The SNP also wants the Scottish Government to have a formal role in key decisions affecting Scotland, even if they are reserved to Westminster.
The demands are set out in a new paper from the Scottish Government, which it has sent to Mr Mundell.
It comes in the wake of the party’s unprecedented victory in the general election in Scotland, capturing 56 of the 59 seats north of the border.
While Mr Swinney said full fiscal autonomy is the “best route to fulfil Scotland’s potential”, he said devolution of the powers it has prioritised would still “make a real difference to Scotland’s economy and people”.
He said: “Responsibility for employment law would help deliver our fair work agenda and strengthen our partnership with business and the trade unions, while power over employment support programmes and Job Centre Plus could deliver an integrated service, joined up with existing education and training services, for people needing support.
“There is also a real advantage to devolving working age and child benefits as it would allow us to design a better, more coherent system that fits with existing Scottish services and our radical approach to preventative spending and early intervention.
“Control over equality would help us create a fairer society by making equal pay law more effective to tackle the gender pay gap, improve the diversity of boards and strengthen protection from discrimination – and would ensure that we could safeguard existing protections for equalities.”
On giving the Scottish Government a role in decisions on reserved issues, the paper proposes new procedures and structures be set up “to allow the Scottish Parliament and Government a formal role in key decisions affecting Scotland directly”.
It adds: “This is especially important when the UK Government’s proposals do not have popular or parliamentary support in Scotland.”
Mr Swinney said: “I have already heard real concerns about the coherence of the measures that the Scotland Bill currently delivers. We will now be pressing the UK Government for substantial and serious discussions on these proposals, in line with the commitment made by the Prime Minister to the First Minister in May.”
When David Cameron held talks with Nicola Sturgeon after the election, he said he would not rule out making further changes to the Scotland Bill if “sensible suggestions” were made.
Mr Mundell said: “The Prime Minister has made it clear that the Government will carefully consider any changes to the Bill that are sensible.
“An amendment that kills off the Barnett formula and ends the sharing of resources across the UK is about as far away from sensible as one can get. It would be a full fiscal shambles that would cost every family in Scotland around £5,000.
“The Government will not accept amendments that are not good for Scotland. The Institute for Fiscal Studies has estimated that fiscal autonomy would mean Scotland having almost £10 billion less to spend by the last year of this Parliament. That is not good for Scotland. That is why the Government will stand up for Scotland and resist the amendment.”