Clash over fiscal powers for Scotland

Scotland's constitutional future moved yesterday to the fore of the election campaign when economists and politicians clashed…

Scotland's constitutional future moved yesterday to the fore of the election campaign when economists and politicians clashed over whether the country should have more fiscal powers.

A group of 12 economists and academics called for Scotland to have control of all tax and revenue-raising, arguing this was necessary for "accountability and responsibility".

The economists, led by Prof Andrew Hughes Hallett of Strathclyde University, said Scotland subsidised England to the tune of £1.2 billion a year and called for Scotland to be given total fiscal autonomy.

The call was welcomed by nationalists as a vindication of their claim that Scotland more than pays its way.

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But Labour and the Tories criticised the suggestion, Labour claiming that it was an old and "flawed" argument, and the Tories that the reality could instead be higher tax bills for Scots.

Elsewhere on the campaign trail, Labour brought the Home Secretary, Mr Jack Straw, to marginal Eastwood, where it is fighting to defend what was once solid blue-chip Tory territory.

Scottish Liberal Democrats outlined where extra cash would be spent on public services in Scotland.

The Scottish party leader, Mr Jim Wallace, said plans by the Liberal Democrats to raise income tax would mean more than £45 billion over five years UK-wide; some £2.6 billion for education, health, public transport and other services.