The UK Government will reject plans today to transfer any more legislative powers to the Scottish Parliament but leave the door open to Holyrood being given more financial accountability.

It will leave it up to the Calman Commission, set up this year by the three Unionist parties in Scotland to examine the future of the devolution settlement, to come up with a new funding formula for Holyrood to replace the £30billion annual Treasury block grant.

Jim Murphy, the Scottish Secretary, echoed yesterday the words of the Prime Minister in Glasgow in September, saying that the “big challenge” of devolution now was how to ensure that the Parliament has a greater degree of accountability than at present.

“We would like to see a situation where the Scottish parliament was more responsible for its spending. The question is how do we ensure that the Parliament has a degree of accountability,” Mr Murphy said. “The Calman Commission will look at that over the next few months.”

It is widely thought that the Calman Commission may back a system of “assigned” revenues under which taxes, such as VAT and stamp duty, which are raised in Scotland, would stay in Scotland, thus reducing at a stroke the amount of money going north of the border in the annual block grant.

If ministers decided to support such a scheme, it would have the added political benefit of meeting head-on growing criticisms in England that taxpayers in England are subsidising the Scots through the block grant.

Aside from more financial accountability, today's submission to Calman is likely to surprise many who thought that ministers in London might be willing to grant more legislative flexibility to Holyrood.

The document will declare that the present devolution settlement covering a host of domestic issues such as education, health, law and order, and transport, is admired in many other countries and does not need any changes. It will claim the settlement in the Scotland Act of 1998 and implemented a year later, has operated effectively and, sources said, reflected the UK Government's increasing confidence that the present settlement was the right one.

The stance comes despite a plethora of recent arguments between the SNP Administration in Edinburgh and the UK Government over issues such as firearms control, broadcasting and electoral administration that the Nationalists have said should be devolved.

The UK Government's response also comes despite opinion polls indicating that while only a third of Scots support separation and the break-up of the UK, more than half think that Holyrood should be given more powers.

A spokesman said: “What the document says is that no logical case has been made for the transfer of more powers to Edinburgh.”

The SNP reacted angrily to the leak of the Calman submission. “This remarkable revelation by Gordon Brown shows Labour's true position on more powers for the Scottish Parliament,” a spokesman said. “The Calman Commission has been exposed as a toothless exercise. All parties in Scotland support more powers for the Scottish Parliament and Mr Brown's denial of these powers shows his disregard and contempt for them both.”

Iain Gray, the leader of Labour at Holyrood, said: “The devolution process is all about the harmony between Westminster and Holyrood and how they work together sharing powers.

"One of the most important areas that the Calman Commission will be looking at is financial accountablility, to ensure that devolution functions as effectively as possible.”

Times Recommends

• Should Knox’s trial even have reached the courtroom?
• All that glitters is not sold in Wright’s world
• Believe it or not, Big Brother is your friend