Cameron set to confront Sturgeon over Scotland's demands for more powers

The leaders are holding talks in Edinburgh following the SNP's successes

Flying the flag for Scotland (AFP/Getty)

David Cameron and Nicola Sturgeon are set to clash over how much extra power should be devolved to Scotland following the SNP’s stunning success in the election.

When they hold talks in Edinburgh, both leaders will claim a mandate from voters for their approach, but the gulf between them will be laid bare. The Prime Minister will stick to proposals backed by all parties last November for the Scottish Parliament to be given control of income‑tax rates and bands, receive a proportion of VAT revenue and £2.5bn of welfare spending, and handed extra borrowing powers.

But Ms Sturgeon, whose party won 56 of Scotland’s 59 seats at Westminster, will demand that Mr Cameron go further than the Smith Commission’s blueprint and will challenge him over the Tories’ austerity measures.

The First Minister said last night that the “overwhelming mandate” the SNP won meant it could not be “business as usual” on public spending or on more powers for Scotland. The SNP leader added: “The proposals of the Smith Commission are a good starting point, but the election result shows that people all across Scotland are keen to move beyond the extra powers it identified.”

Ms Sturgeon will demand “priority devolution” of powers over business taxes, employment, the national minimum wage and welfare in order to boost the Scottish economy. She said: “Scotland expects these powers to be delivered – and I expect the Prime Minister and his government to recognise the democratic mandate that now exists to deliver them.”

Although both leaders will pledge to negotiate constructively and with respect, that will not mask the divide between them.

On his first visit to Scotland since his election victory, Mr Cameron will say: “I am here to underline my commitment to our United Kingdom and Scotland’s important place within it.

That means remaining true to the promise we made to implement the all-party Smith agreement to make Scotland one of the most accountable and powerful devolved parliaments in the world”.

The Prime Minister will add: “It also means recognising those things which unite us in these islands: the achievements we have made together, the institutions we have built together, our great social history, the common economic challenges we face today, and the strength which comes from pulling together for the common good.”

Mr Cameron is not expected to call the SNP’s bluff by offering Scotland full control over tax and spending. Some Conservatives have urged this as a way of scrapping the Barnett formula, which sets the level of public spending in Scotland, Wales and Northern Ireland and favours Scotland. Although the SNP wants full fiscal responsibility eventually, it argues that the change should be phased in over several years.

The Prime Minister will say: “Scotland has two governments and it is the duty of the First Minister and myself to respect each other’s roles and responsibilities and to work together for the benefit of all the people of Scotland.

“As more powers are devolved to Scotland, it is time to focus on those bread and butter issues that affect every family in our United Kingdom – jobs, homes, good schools and strong public services, and dignity and respect in retirement. These are the building blocks we need to provide a brighter future for people in every part of our country.”

Tensions between the SNP and the Conservatives rose ahead of talks when Downing Street announced that Andrew Dunlop, the Prime Minister’s adviser on Scotland, would be made a peer and a minister in the Scotland Office.

The SNP denounced the move as a “scandal” because of his roles advising Margaret Thatcher on the introduction of the poll tax north of the border in the 1980s and helping Mr Cameron in the campaign against independence in last September’s referendum.

Angus Robertson, the SNP’s leader at Westminster, said: “If one thing demonstrates how out-of-touch the Tories are, it’s the appointment as a minister for Scotland of an unelected Lord who played a leading role in the imposition of the hated poll tax on Scotland.

“It is hard to believe that following the worst Tory result in a general election in Scotland since universal suffrage, they could have fallen further in people’s estimation, but they just have with this appalling and anti-democratic appointment.”

Yesterday members of the Scottish Parliament piled the pressure on Mr Cameron to go further on their powers. They said his plans did not meet “the spirit or the substance” of the “vow” he made with Ed Miliband and Nick Clegg in the run-up to the independence referendum.

Holyrood’s Devolution Committee, which includes Tory and Liberal Democrat MSPs, said the current proposals in the draft Scotland Bill fell short of implementing the Smith Commission’s plan. One example was the absence of a power for the Scottish Parliament to top up benefits.

Ms Sturgeon is expected to remind Mr Cameron that the election result was merely the “confirmation” of alliances that Scotland was already building and which had accelerated since last year’s referendum debate.

She will tell the Prime Minister that the UK government is no longer dealing with just the party controlling Holyrood, but wider alliances that include Scotland’s trade unions and the voluntary sector, which want to see further devolution on welfare.

Ms Sturgeon may argue that while Labour might believe it retains some of its traditional support in Scotland, eventually the party will be “challenged” over who to side with: a Scottish government that wants control over the minimum wage and state influence on employment, or Mr Cameron’s Conservative Government.

According to her aides, Ms Sturgeon’s strategy is to tell Mr Cameron that the claimed “civic support” for “super-devolution” means his Government’s opposition in Scotland is not the SNP but “all those who have made it clear in the election that five years of an unsympathetic right-wing government in London will have consequences”.