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The prospect of substantial extra devolved powers was dangled in front of the Scottish electorate in the closing days of the campaign as a shaken UK political class sought to head off the pro-independence surge.

Yet, despite the grand rhetoric that accompanied the offer, backed by all three main Westminster parties, the scope to give Scots significantly more control of the domestic agenda remains limited.

Health and education have been devolved matters since the Holyrood parliament was established in 1999. On the National Health Service, the Scots have flexed their muscles by rejecting the split between purchasers and providers of healthcare, which underpins a competitive market in England. In education, Scotland has shunned the made-in-England model of academies and free schools, opting to keep its institutions under the control of local authorities.

Voters’ rejection of independence will do little to change that status quo, especially since a key part of the “vow”, unveiled this week, involved a pledge to allow Scotland to keep its funding allocations under the Barnett formula. This distribution allows it to spend £200 a head more on each NHS patient than in England, for example.

Immigration and border control cannot be devolved within a single nation state, so the area in which genuine new powers are now on offer is welfare. However, the picture here is also far less radical than would have been achieved under the nationalist vision of an entirely separate benefits system.

The SNP had planned to abandon universal credit, the controversial scheme that will see six tax credits or benefits rolled into a single payment; perhaps to make some benefits more generous than those south of the border and to consider delaying rises in the state pension age.

None of this will be possible under devolution; different levels of pensions and unemployment benefit would not work in a single state where workers could move to whichever nation offered the best deal.

The most significant new freedom on offer is control of housing benefit, which is tied to residence. The Conservatives, Liberal Democrats and Labour seem to be at one in their willingness to offer this.

Proponents argue there is a clear logic to this, given that social housing is already a devolved matter. Local authorities would be able to make their own decisions about investment in building up their stock. It would also allow the Scottish parliament to brandish an emblematic victory by scrapping the under-occupancy charge, known to critics as the bedroom tax, which requires people to pay over and above their housing benefit allowance if they have a home too big for their immediate needs.

Experts say that, even though housing benefit is part of universal credit, that system would be flexible enough to allow for Scotland-only “top ups” within a national framework. Labour also seems content to place the administration of attendance allowance, which helps with the costs of personal care for older and disabled people, in the hands of the Scottish parliament.

The possibility that the work programme, under which long-term unemployed people are given training and advice to return to the workplace, could be devolved has also been raised. Supporters argue that this scheme should be delivered as close as possible to the communities it serves, capitalising on inside knowledge about the structure of the local labour market and connections with nearby employers. However, such a move could potentially mean unpicking some existing contracts, which could prove costly and disruptive to those receiving its services.

There is talk, too, of the childcare element of the working tax credit being devolved although, as with housing benefit, this would have to be accommodated within the framework of universal credit, of which it will form a part.

With a draft law to enact the new powers promised in time for January 25 next year – Burns Night – Scotland’s expectant electorate will not have too long to wait for more detail about what a new constitutional settlement will really mean.

Copyright The Financial Times Limited 2017. All rights reserved.
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