Questions remain over fiscal commission
ICAS has submitted its response to the Scottish Government's consultation on the Scottish Fiscal Commission and identifies some areas of concern.
Proposals to strengthen the scrutiny arrangements of the Scottish Fiscal Commission have been welcomed by ICAS.
However, some questions remain over the intended relationships between it, the government and parliament.
The Scottish Fiscal Commission was established on a non-statutory basis in June 2014, but it is proposed that it should be put on a statutory footing. The Scottish Government has consulted on its detailed proposals for legislation to do this.
ICAS has said that independent scrutiny/assessment and reporting of Scottish Government forecasting, the modelling of tax rates and receipts, and borrowing is vitally important. To do this, there will need to be adequate funding and the Scottish Fiscal Commission must be appropriately resourced.
It is also key that the Scottish Fiscal Commission is impartial, and the Smith Commission Report highlighted the need for independent fiscal scrutiny. ICAS has said that it may be beneficial to have the commission on a statutory basis, but its independence is not necessarily obvious if it is a part of the Scottish Administration.
ICAS has some reservations regarding the nature of the proposed relationships between the Scottish Fiscal Commission, Scottish ministers, and the Scottish Parliament. The nature of the relationships depends on whether the commission is to be independent or is simply to be impartial.
If it is to be independent then it is debatable whether this is accomplished by setting up a body within the Scottish Administration, and over which Scottish ministers may exert significant influence by stating what reports are required, being involved in appointments, and being able to put forward statutory instruments which may change the functions of the Scottish Fiscal Commission.
The Smith Report called for parliament's oversight of government to be strengthened, and also noted that there was a weak understanding amongst the public of the constitutional settlement. However, neither of these two issues are assisted with the current proposals.
For the general public who are not accustomed to the detailed specifics of different public governance vehicles, the draft legislation does not look as though it would establish an independent commission. It may be that a more accurate analysis of the Scottish Fiscal Commission as currently proposed is one of impartiality within the Scottish Administration, rather than being an independent commission.
The draft legislation provides a regulation-making power so that the functions of the Scottish Fiscal Commission may be added to, modified, or removed. ICAS recognises, and agrees, that the role of the commission may evolve and grow as fiscal powers and responsibilities are devolved. However, ICAS has raised its concerns about the proposed use of secondary legislation to change primary legislation, particularly when this relates to the core functions of the Scottish Fiscal Commission.
The granting of powers, duties and functions to a statutory body are an important exercise of parliament's duties and therefore should only be exercised through primary legislation so that there is full consideration before doing so. Secondary legislation should be used for administrative purposes only, such as how the powers in primary legislation are to be exercised and accounted for.