Holyrood powers and question of scrutiny

Among them was Tricia Marwick, the Scottish Parliament's Presiding Officer (PO), for whom Lord Smith had a clear message. The substantial package of new powers, he said, "means that parliament's oversight of government needs to be strengthened". He urged the PO to build on her programme of Holyrood reforms by launching an "inclusive review" to come up with recommendations before the new powers take effect.

Lord Smith also called on her to help with what he described, possibly with a touch of understatement, as the public's "relatively weak understanding" of the devolution settlement. A meeting between Ms Marwick and John Bercow, the Speaker of the House of Commons, would not go amiss, he suggested, as part of a combined effort to explain the "complex balance of powers" and let people know which parliament does what.

This was all very welcome to the PO. Ms Marwick has already called for Holyrood's committee conveners to be elected, rather than appointed by the parties, in an effort to strengthen the system. She has been careful not to get drawn into the row over whether the committees, dominated by SNP backbenchers, have been protecting rather than challenging government ministers.

However, the effect of her proposal would be to increase the chances of Holyrood's more independent-minded MSPs taking key roles scrutinising the work of the Scottish Government. Ms Marwick would like to go further and Lord Smith's call can only strengthen her hand when it comes to loosening the parties' stranglehold on parliamentary business. As for working with Mr Speaker, that already happens. They don't advertise it, but the UK's exclusive club of four speakers/presiding officers meets regularly throughout the year. There is no reason why a public information campaign should not be mounted promptly.

As Tavish Scott, the former Scottish Lib eral Democrat leader pointed out after the Smith Commission report was unveiled, the most important area where additional scrutiny of the Government is required is finance. The Smith powers will transform the way the Scottish Government operates. Depending on whose figures you prefer, ministers will be responsible for raising 62 per cent or 48 per cent of the money they spend - a sizeable chunk by either calculation. To maintain spending levels, including the cost of providing benefits to be devolved to Holyrood, they will need to raise £20 billion.

The budget will include around £11bn from income tax raised in Scotland and £4.6bn from VAT. That's in addition to the £2bn revenue from already-devolved business rates, £500 million from John Swinney's new Scottish Land and Buildings Transaction Tax and more from smaller taxes. If Air Passenger Duty is scrapped, as the SNP have promised, the £200m-plus it raises will have to come from somewhere else. Suddenly, the task of forecasting tax revenues and analysing the effectiveness of different levies becomes vitally important. The job appears beyond the scope of the Scottish Fiscal Commission, the body set up to mirror the work of the UK's independent Office for Budget Responsibility, and fixing that will require not Holyrood reform but government legislation. In other words, ministers must ensure their work is scrutinised.

The Scottish Fiscal Commission was born amid controversy and complaint as two of the eminent economists appointed by John Swinney to test the Government, Professor Andrew Hughes Hallett and Lady Susan Rice, also serve on the Council of Economic Advisers which guides the Government.

They went a long way towards allaying concerns they were too close to the Government when they warned the Finance Secretary was over-optimistic about revenues from his new-look stamp duty in their first report last month. However, the Government can still expect to come under intense pressure to ensure the watchdog's independence and impartiality when it moves to expand the body and put it on a statutory footing in a couple of years' time.