Brown hints at Scottish finance powers

Scotland's finance secretary has accused Gordon Brown of "caving in" to the case for more powers for the Scottish Parliament.

Rising support for the SNP and Labour's defeat in the Glasgow East by-election had forced Brown to shift ground, John Swinney said.

The claim came after Gordon Brown's speech to the Scottish CBI in Glasgow in which the prime minister appeared to support Holyrood having greater financial powers.

Brown said the Scottish Parliament was not currently accountable for the size of its budget, and the budget was not linked to the success of the Scottish economy.

Swinney said today this was "massive" change by Brown after saying last year that there was no case for more powers for the Scottish Parliament.

"Here we are a year later, Gordon Brown has caved in to pressure from the Scottish National Party and rising support for the SNP, based on the aspirations of the people of this country," he told BBC Radio Scotland.

"I'm immensely encouraged that we are now going to be in a situation where we will have a Scottish Parliament - in whatever scenario that develops - that will have more financial powers.

"That will make us better able to make Scotland a more successful country."

Swinney went on: "Whether it is the prime minister's option that emerges or the Scottish government's position of believing in Scottish independence that prevails, Scotland and our Parliament is going to have more financial powers and that's a great step forward."

And the finance secretary recalled: "People said that devolution would kill the SNP stone-dead - and we are now the government of Scotland.

"So I think we have to be awful careful about predicting what the impact of this will be.

"Because what the evidence shows is that when Scotland gets more powers, we simply want to do more and succeed more."

In his speech to business leaders Brown launched a fierce attack on the SNP, accusing the Nationalists of a "bleak separatist obsession" and attacking their claim to be a pro-business party.

An official commission headed by Sir Kenneth Calman is studying whether the Scottish Parliament should have more powers, although independence has been excluded from its remit.

Brown told the Scottish CBI: "I am not going to pre-judge the commission's work but I do want to say two things about it.

"First of all, devolution has worked, but I do see one problem - while there have been good reasons why this is so, the Scottish Parliament is wholly accountable for the budget it spends but not for the size of its budget.

"And that budget is not linked to the success of the Scottish economy.

"That is why we asked the Calman Commission to look carefully at the financial accountability of the Scottish Parliament. And this is a critical part of Calman's remit."

Brown went on: "The second thing is more important still. Be under no illusion about my purpose.

"Devolution is intended to preserve the unity of the United Kingdom - and developing devolution is intended to strengthen Scotland's place within it."

Brown's speech came at a time when the SNP is still riding high in opinion polls, and Labour is bracing itself for a difficult by-election in Glenrothes.

The prime minister warned of a "real risk" of waking up one day to find the benefits of the Union had been too long taken for granted and had been "thoughtlessly thrown away".

He cited defence orders placed in Scotland and a Scottish financial services sector which was the country's biggest employer.