Referendum aftermath

Lord Smith announced the recommendations of his commission in Edinburgh (to see this you need to access the link above).

The Scottish Parliament should have the power to set income tax rates and bands, the body on strengthening devolution has concluded.

The Smith Commission also said a share of VAT should be assigned to the parliament, and Air Passenger Duty fully devolved.

The commission was set up by Prime Minister David Cameron in the wake of the vote against Scottish independence.

Its findings will form the basis of legislation on more Scottish powers.

The UK government welcomed the report, but Scottish ministers said it fell short of what the nation needed to flourish.

The Smith Commission, which took forward its recommendations in consultation with the Scottish Parliament's five parties - The SNP, Labour, Conservatives, Liberal Democrats and Greens - recommended that:

   The parliament should be given the power to set income tax rates and bands on earned income and will retain all of the income tax raised in Scotland.

   The parliament should be given powers to allow 16 and 17-year-olds to vote in Scottish elections.

   The parliament should be given powers to create new benefits in devolved areas and make discretionary payments in any area of welfare.

   A range of other benefits that support older people, carers, disabled people and those who are ill should also be fully devolved.

   The Scottish government and Scottish Parliament should have a "formal consultative role" in the process of reviewing the BBC Charter.

Scottish Secretary Alistair Carmichael said a "stakeholder group" would now be set up to take forward the recommendations.

The Liberal Democrat MP said: "Having a more powerful Scottish parliament inside a strong United Kingdom will open the door to more constitutional change in the United Kingdom.

"We can achieve home rule all round."



The Scottish government said any new powers were to be welcomed, but First Minister Nicola Sturgeon argued the Smith Commission package was ultimately disappointing because many powers, like the personal tax allowance, corporate taxation and child and working tax credits, would remain with Westminster.

Speaking at Holyrood, she said: "70% of our taxes continue to be set at Westminster, 85% of social security controlled at Westminster - this parliament responsible for less than half of the money we will spend.

"It's not so much the home rule that was promised - in so many respects, it's continued Westminster rule."