Indy Ref: Big changes to Scotland no matter who wins the referendum

The nation will never be the same again.

For evidence of how the pace has picked up in the decisive last few days of the referendum campaign look no further than the issue of further devolution.

The first poll to give the Yes side a lead last weekend was quickly followed by the promise of more powers if Scotland votes No.

Exactly what those powers will be has yet to be spelled out but all the main Westminster parties have endorsed a timetable first proposed by Gordon Brown that would see another Scotland Act in train before next year’s general election.

The promise of more powers has always been on the table but not the ballot paper. Now the Westminster parties are committed to delivering something that could be characterised as devo-max.

They clearly believe that can convince the Scots to stay. The question is what will those extra powers add up to?

The issue of more powers for Scotland after a No vote has been centre stage in the last week of campaigning.

We now have a timetable which is clear, if a bit twee in the choice of key dates a White Paper would be published on St Andrew’s Day and the draft law would be drawn up by Burns’ Night.

All three party leaders at Westminster have backed that framework, but have yet to agree or set out exactly what will be in the next stage of devolution.

We do know that, whatever the referendum result, Scotland will get more powers before the general election courtesy of the Scotland Act passed in 2012 but coming into force in stages through to 2016.

Next spring, landfill tax and stamp duty will be replaced with similar levies set, raised and spent in Scotland.

Holyrood will also gain borrowing powers to pay for big infrastructure projects like the new Forth bridge. At the same time the wheels will be set in motion for a specific Scottish rate of income tax.

The Scottish Parliament has had the power to alter the basic rate of income tax by up to 3p since it opened in 1999 but has never used it. From April 2016 Holyrood will be able to alter all tax bands by up to 10p in the pound.

Going further on income tax devolution is something all three main unionist parties agree on in their plans for boosting Holyrood’s legislative muscle further after a No vote.

The Tory proposal is the most radical giving Holyrood almost a free hand on income tax with only the level of the tax-free personal allowance set by the Treasury in London.

Labour cooked up something more limited in their Red Paper on further devolution.

Holyrood would only be able to vary higher tax bands, allowing the Scottish Government to reinstate the 50p tax rate if they wanted to.

However the Labour proposals were widely criticised as half-baked when they were unveiled and were only pulled together after titanic internal struggles between the party’s MPs and MSPs.

If Labour can’t agree among themselves on what happens next it’s hard to see how they could agree with anyone else. The Lib Dems have long advocated getting everyone to agree a programme.

Scottish Secretary Alistair Carmichael’s plans for a “Conference for a New Scotland” including the SNP to chart a way forward after a No vote has been rather superseded by the most recent turn of events.

Instead there will be a public consultation on what should go in the new legislation. As well as more power over income tax rates other levies such as Capital Gains Tax and Air Passenger Duty could be devolved to Edinburgh.

Scotland would also get more control over welfare including housing benefit meaning Westminster could no longer impose a bedroom tax on Scotland and the work programme designed to help the unemployed back into work, a step designed to neuter Alex Salmond’s attack that no new job creating powers were promised by the unionist parties.

But whatever the next Scotland Act offers will only be a sticking plaster solution, there’s growing consensus that some sort of constitutional convention looking at the UK’s entire set up is likely to be established after the referendum.

Two things are almost certain to emerge from that.

The first is establishing the Scottish Parliament permanently in law, ending the current arrangement under which Westminster, in theory at least, could shut the Scottish Parliament if MPs so wished.

The other elephant in the room that all parties will have to acknowledge is the future of the Barnett Formula. Joel Barnett was the Chief Secretary to the Treasury who had to implement austerity back in the 1970s when the UK economy was on its knees.

He was the Danny Alexander of his day. But he earned his place in history by drawing up a formula to carve up funding between the constituent parts of the UK.

It means that if spending is cut in England on schools for example then there’s a consequent cut in the Scottish budget.

Or indeed if the Government pumps money into the NHS, as Labour did after 1997, there’s more cash for Scotland too.

Barnett only envisaged the formula as a temporary measure. It’s still in place a generation later. And it’s skewed towards Scotland.

Because money is distributed according to population share, and the ratios are out of date, rather than according to need Scotland appears to get more than England or Wales.

Currently the Barnett Formula works for Scotland, which is why the SNP like to warn that after a No vote it could be scrapped. Of course, after a Yes vote it will definitely be scrapped.

The Prime Minister has said that reviewing Barnett is “not on the horizon”. A statement that bizarrely led Nicola Sturgeon to claim he’d let the cat out of the bag on plans to slash funding by £4 billion.

Certainly no-one is publicly and clearly advocating scrapping Barnett. At least no-one with the power to do so. But there are significant hints that it will change.

And that will matter particularly after 2015, because whoever wins the election Westminster will wield the axe on public spending again.And that means less money for Scotland too.

Though, of course, the unionist parties claim that if Scotland goes independent its financial position will be even worse, pointing to the Institute of Fiscal Studies research that showed a separate Scotland would need to make an extra £6 billion of spending cuts or equivalent tax increases to balance the books.

If it is a No vote the size of the victory will affect what happens next.

A large majority for the status quo now looks unlikely, meaning Scotland will stay in the political consciousness and Westminster will have to keep its promises.

But a tight result might also set the Yes camp will start thinking about how soon they can have another go. In Quebec, Canada, a second referendum took place just 15 years after the first.

A Yes vote will be final. If it’s No we could all be here again in a few years’ time.