The independent body set up to examine the future of Scottish devolution has ruled out giving the Parliament in Edinburgh full control over taxation and spending north of the Border.

The Calman Commission, in an interim report published yesterday, says that giving MSPs full fiscal autonomy would be inconsistent with the concept of a United Kingdom. The reports adds: “A region with full fiscal autonomy is to all intents and purposes independent... [it] is not consistent with the maintenance of the Union.”

It is the only concrete finding of the report, which concentrates on how devolution has worked over the past nine years and reviews the evidence it has received on what further powers could be devolved to Holyrood.

The tone of the report is firmly pro-Union, setting out the case for Scotland remaining part of an integrated social and economic Union.

It says that certain functions are integral to the UK as a nation state, where devolution would be undesirable. “These comprise the monarchy, the UK constitution, defence, national security, foreign affairs, currency and coinage,” it says.

The report from the Commission, which was set up earlier this year by the three pro-Union parties in Scotland and led by Sir Kenneth Calman, the former Chief Medical Officer, makes no specific recommendations about what further powers should be devolved to Holyrood.

Although the final report will not be published until next year, there are indications in the interim report as to where the minds of the 15-member commission are focused.

While stressing that it has not reached a final view, the commission says that there “appears to be a plausible case” for giving Holyrood more control over aspects of broadcasting, energy policy, animal health and movement, firearms, misuse of drugs, regulation of health care professionals, and marine planning.

It is also looking for more evidence before making a decision on whether control over aspects of the civil service, insolvency, employment law, immigration and health and safety could be devolved, although the report says that there is not yet sufficient evidence for change in these areas.

A large chunk is concerned with the financial accountability of the devolved Parliament, relying heavily on the report of a group of economists submitted to the commission and published two weeks ago.

The commission report says that the present system of funding Scottish devolution, through the block grant and the Barnett formula, got the Scottish Parliament off to a good start. “Its stability and predictability mean that there have been no wild fluctuations in financial provision,” it adds.

However, it draws attention to the controversy on both sides of the border over how the population-based Barnett formula operates, with critics in England believing it gives Scotland an over-generous financial settlement, and critics in Scotland arguing that the formula is applied inconsistently.

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