Radical shake-up of devolution revealed

New plans unveiled by the Government could see a swathe of new powers including control of income tax transferred from Westminster to the Scottish Parliament, in the most radical shake-up of devolution.

Westminster will cut the UK rate of income tax by 10p in Scotland, alongside a corresponding cut in Holyrood's share of public spending. This will require Holyrood to impose a Scottish income tax of 10p if it wants its budget to remain unchanged, or more if it wants extra money.

The Scottish Secretary, Jim Murphy, told the Commons: "Since the first day of devolution, the Scottish government has been accountable for how it spends taxpayers' money. Under today's proposals they will also be held to account for how they raise it."

As well as taxation, the White Paper presented yesterday aims to give Holyrood greater powers over legal issues and borrowing. But none of it is set to come into force until after the general election, with David Cameron insisting he would not be bound by the proposals if he wins power.

If Labour retains power, Mr Murphy said the recommendations would be implemented between 2011 and 2015. Mr Cameron said Scottish ministers needed to be more financially accountable, but added that he would not be "bound" by any White Paper produced by the Government.