RSE responds to proposals for an independent fiscal body
In the context of the new financial powers arising from the Scotland Act 2012, the Scottish Parliament’s Finance Committee is undertaking an inquiry into proposals for an independent fiscal body.
In its response, the RSE states that it will be necessary to consider the constitutional arrangements within which the proposed independent fiscal body will be operating. The form of body required is likely to differ under the present constitutional settlement as compared to either independence or the devolution to Scotland of further powers.
The RSE is of the view that it would be valuable to establish in Scotland an independent fiscal body capable of providing authoritative and independent assessment of the fiscal position and general prospects for the Scottish economy within the context of UK and international developments.
Whatever form the body takes, it is crucial that the forecasting work it undertakes is integrated within the processes that shape the Scottish Government’s spending plans and the setting of the budget.
Beyond the forecasting function, the RSE believes consideration should be given to the provision of analytical commentary on major longer-term strategic issues and commitments. This would enable independent consideration to be given to financing implications beyond the parliamentary cycle.
In order to support the reputation, impartiality and the credibility the body, it should be appointed by, and directly accountable to, the Scottish Parliament.
Aspects of the RSE’s recent response to the Finance Committee on the National Performance Framework (NPF) are relevant to the current inquiry. The RSE response on the NPF can be read here.