Blair denounces Tory `lie' on Scottish tax rise

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Government arguments that a parliament for Scotland would cost Scottish taxpayers an extra 20p in the pound were yesterday dismissed by Tony Blair as coming "straight from the Tory lie machine", writes Patricia Wynn Davies.

The counter-attack from the Labour leader follows a Commons written answer from John Major on Friday saying that if current spending levels in Scotland were to be reduced to those for England, the shortfall to be made up by Scottish taxpayers would be equivalent to "at least an extra 19p in the pound on income tax".

That came as Kenneth Clarke, the Chancellor, warned in an Edinburgh speech that English taxpayers would not put up with the Westminster government spending more per head in Scotland, as currently happens, if Labour devolution plans were put into effect.

Mr Clarke said identifiable Government spending north of the border was 21 per cent higher than in England - equivalent to more than £600 per person a year and at least 16 per cent more than the UK average.

Mr Blair said it was "simply absurd" to suggest that devolution would result in a 20p tax rise. "This is the same lie machine that told us before the last election that the Tories would cut taxes when in fact they raised them by the equivalent of 7p in the pound," he said.

"In the UK resources are pooled at the centre and then distributed according to need. That is what dictate's Scotland's level of public expenditure now and the same principle will apply when devolution is in place."