Devolution Dangers

There's a warning our economic growth could be damaged if arbitrary deadlines for devolution are rushed.

The CBI Director-General, John Cridland, will deliver a speech later where he'll say that businesses believe devolution to be a real opportunity, but are concerned about 'rushed backroom deal'.

The Smith Commission report, which sets out additional powers for Holyrood, isn't expected to be turned into legislation until after May's general election.

Mr Cridland is also expected to warn that local bodies must recognise that enhanced powers must be met by commitments to structural reform, taking tough choices on budgets and priorities in a challenging fiscal climate.

"Business can, and should – play a constructive role in this debate.

"Our members are most interested in the point at which devolution comes into contact with business.

"First, they raised concerns about the speed of further devolution.

"Now, here, it's important that where promises of further devolution have already been made – be that the Smith Commission in Scotland or the devolution of Corporation Tax in Northern Ireland, that these powers are delivered in order to give businesses in the devolved nations the certainty they need.

"But, going forward, the precedent set for 'devolution by deadline' is a cause for concern.

"Any devolution of powers must be done in a careful, considered and transparent manner. And not through rushed backroom deals between politicians and civil servants.

"Let's take time to breathe and - above all, let's make sure we get this right. The alternative would be uncertainty, complexity and increased costs at the moment we can least afford them.

"Second, our members stressed that further devolution must be built on strong economic foundations.

"Devolution shouldn't be about being ‘different for its own sake - it should be means to an end – economic growth across the UK.

"Fundamentally, we want the next “Government to ask 'how does devolution fit into our plans for growth?' rather than ‘how does growth fit into our plans for devolution?’

"Business wants to see evidence that further powers will complement, not constrict, growth, jobs and investment."

The CBI chief will also unveil three tests for 'growth-friendly' devolution.