11. Scotland Runs Scotland 🔴

Immigration, nationality and asylum are reserved in full. So are the main taxes, National Insurance, VAT, corporation tax and monetary policy. Deporting foreign national offenders is an immigration function, bound by the UK Borders Act, the Human Rights Act, and the Convention. Holyrood can set some income-tax rates, run prisons and house people. It cannot write the rules on who enters, who is removed, or most of the money that funds the state. That is a constitutional limit, not a temporary administrative one.

Current reality

Legal and institutional position

The Scotland Act 1998, Schedule 5, Head B6 reserves: “Nationality; immigration, including asylum and the status and capacity of persons in the United Kingdom who are not British citizens; free movement of persons within the European Economic Area; issue of travel documents.” Section 29 makes any provision of an Act of the Scottish Parliament that relates to a reserved matter “not law.” Purpose and effect, not form, decide competence.

Schedule 5, Head A1 reserves fiscal, economic and monetary policy, including taxes and excise, borrowing, UK public expenditure, the exchange rate and the Bank of England. Exceptions are devolved taxes and local taxes. Those exceptions now cover rates and bands of non-savings, non-dividend income tax; Land and Buildings Transaction Tax; Scottish Landfill Tax; Non-Domestic Rates; council tax; and, from 1 April 2026, the Scottish Aggregates Tax. The Personal Allowance, National Insurance, corporation tax, VAT, capital gains tax, inheritance tax and the rest remain reserved. Air Departure Tax and VAT assignment have been agreed in principle and are not fully in force.

Deportation sits inside B6. The duty to make a deportation order against a “foreign criminal” is in the UK Borders Act 2007. A foreign criminal, for that duty, is a non-British (and, as later clarified, non-Irish) person sentenced to at least 12 months. Exceptions include breaches of Convention rights or Refugee Convention obligations. Section 45 of the Sentencing Act 2026, commenced on 22 March 2026, brought suspended sentences of 12 months or more within that duty for convictions on or after that date. Article 8 and Article 3 remain available. The Scottish Parliament cannot amend the Human Rights Act 1998 or invent a free-standing “ECHR exit clause.”

The Supreme Court held in 2022 that Holyrood cannot legislate for an independence referendum because the Union is reserved. A section 30 order or UK primary legislation would be required to transfer these competences, or a change in constitutional status.

The latest official numbers

Population (National Records of Scotland, mid-2025).
5,545,500 people, up 2,200 (under 0.1 per cent). Births 45,400; deaths 61,600; natural change −16,200. International net migration +9,300 (lowest in five years). Rest-of-UK net +8,600. Total net migration +17,900, against 83,300 to mid-2023 and 47,000 to mid-2024. Without net in-migration, the population would have fallen. Natural change has been negative every year since 2015. Official projections still point to an earlier peak and a sharper working-age decline than the UK average.

Fiscal Framework (Scottish Budget 2026-27 / Scottish Fiscal Commission, January 2026).
Scottish income tax revenue forecast £21,508 million; Block Grant Adjustment −£20,539 million; net position +£969 million. LBTT revenue £1,049 million; net +£261 million. The 2023 review made the Indexed Per Capita method permanent, raised resource borrowing for forecast error to £600 million (2023-24 prices, indexed), indexed capital limits, and abolished annual reserve drawdown caps. About half of resource funding still arrives as a block grant plus adjustments. UK decisions on the Personal Allowance and National Insurance still hit Scottish taxpayers and the Budget.

Prisons (Scottish Prison Population Statistics 2024-25).
Individuals who spent any time in custody who were not British nationals: 9 per cent, up from 5 per cent in 2017-18. British nationals: 14,286 of 15,792; non-British: 1,506. Largest non-British groups: EEA (627, of whom 36 per cent Polish, 21 per cent Romanian); Asia (272, Vietnam 49 per cent); non-EEA Europe (258, 94 per cent Albanian); Africa (178). SPS records liberation type, including “deportation,” but does not control the Home Office order or the appeal.

Homelessness (official 2024-25 and April–September 2025).
Applications 40,688 in 2024-25, down 1 per cent. Applications from people with refugee or leave-to-remain status, and from Ukraine-scheme nationals, rose while British/EEA categories fell. Over half of that combined group was in Glasgow (2,770 of 8,445 Glasgow applications). In April–September 2025, applications from refugee/leave-to-remain households were 16 per cent of the total and 51 per cent higher than a year earlier; other eligibility groups fell. Temporary accommodation and open cases were at or near series highs. Glasgow remains the principal Scottish dispersal location (Home Office/COSLA figures put around 4,500 people awaiting a decision). Local authorities discharge the 2012 duty to settled accommodation for those granted leave. They do not set asylum intake.

How it is experienced in daily life

A care home that cannot fill shifts after a visa-route change did not vote on that route. A Glasgow housing officer managing temporary accommodation did not decide the asylum decision or the dispersal contract. A prison governor holding a person who cannot be removed did not write Article 8. A Scottish taxpayer paying a frozen Personal Allowance did not set it. Integration classes, college places and council-tax policy are the Scottish end of a UK decision.

How it got here

1998 treated nationality, borders and the main fiscal union as attributes of the UK state and the Common Travel Area. Calman (2009) and Smith (2014) expanded tax and welfare. Neither recommended immigration. UK governments of both main parties have kept B6 intact. Limited post-study or “Scottish visa” ideas have sat inside UK rules. Negative natural change since 2015 made the reserved inflow the residual that stops population decline. Dispersal, then hotel contingency, then leave-to-remain proposals landed on a homelessness law more generous than England’s priority-need test.

What has already been tried, and what that showed

Partial tax devolution showed behavioural response and a positive income-tax net position of £969 million — and still left NI, VAT and corporation tax in London. Indexed Per Capita protects the Budget from relative population decline; it does not give a Scottish visa. Integration and Fresh Talent-style attraction work on people who already have leave. They do not create leave. Intergovernmental lobbying has not moved B6. Prison statistics can be published; deportation orders cannot be issued in Edinburgh.

What needs to happen

This heading, for this item, describes what full control would consist of, not a claim that it is available.

The improvement in measurable terms

An immigration system whose numerical and skills rules could be set in Scotland. A tax base whose main heads could be redesigned here. A removal regime whose statute and exceptions were written by the same parliament that funds the prisons. Those are the measures implied by the title. They are not currently in the Scottish statute book.

Sequence

There is no lawful Holyrood sequence that reaches this destination. The available sequence is: use existing tax, skills and housing powers at the margin; record the consequences of reserved decisions; and treat any transfer as a UK legislative event.

Workforce, capital and standards

Border force, visa processing, returns agreements and HMRC-scale collection are UK operational systems. A transferred power would still need those capacities built or inherited. Convention litigation would not vanish because the legislator changed.

What would count as success in twelve months?

Not “Scotland runs Scotland.” In twelve months, the test of the present settlement is narrower: whether the next NRS, SFC, homelessness and prison releases describe the split of powers without pretending the split is something else. A section 30 or UK Bill would be a different event.

What can be done under current powers?

Who holds the lever

UK Parliament and Home Office: entry, stay, asylum, deportation. Treasury, HMRC and the Bank: the main tax and money. Scottish Ministers: NSND income-tax rates and bands, LBTT, NDR, council tax, aggregates tax, skills, housing law, prisons, integration. Local authorities: homelessness duties and some dispersal friction.

The statute, budget or direction

Scotland Act 1998 ss. 29–30 and Schedule 5; Fiscal Framework 2023; UK Borders Act 2007 s. 32; Sentencing Act 2026 s. 45; Human Rights Act 1998; Immigration Rules.

What is already possible and unused

More precise use of devolved tax to the edge of the NSND base. Skills and recognition for people already here. Housing supply, which is devolved, against a homelessness caseload that includes reserved inflows. Published pipeline tables that show which pressures are Home Office and which are Scottish. None of that is a Scottish border.

What would still be true if management improved tomorrow

Schedule 5 B6 and A1 would still apply. Natural change would still be negative. The Home Secretary would still make the deportation order. The Personal Allowance would still be set in the UK Budget.

Where the limits are

Law and reserved powers

This is the whole item. Competence is not shared. Administrative workarounds that determine who may enter or remain are likely outside section 29.

Money

The £21.5 billion income-tax line is large and still nestled in a BGA. Full fiscal autonomy is not a bigger Scottish rate on the same base. It is the other taxes, borrowing, and currency framework.

Workforce and capital

Home Office, Border Force, tribunal and HMRC capacity are UK. Scottish prisons and temporary accommodation are the domestic cost centres.

Time, geography, UK-wide systems

The Common Travel Area, the single labour market and ECHR membership are UK-level facts. Returns require other states’ consent.

Political difficulty, kept separate from legal impossibility

Asking Westminster for a section 30 on immigration is politically hard. It is still the legal route. Calling a referendum Bill without that route was already decided in 2022.

What is not yet known

Mid-2026 migration. 2025-26 prison nationality. Full-year 2025-26 homelessness by eligibility. Whether VAT assignment or Air Departure Tax is implemented. How many of the 1,506 non-British individuals in the 2024-25 prison flow were actually removed? The next Fiscal Framework review’s scope.

Honest summary

Achievable now. Manage consequences: tax at the margin, housing, skills, integration, prison data, intergovernmental argument.

Only partly achievable. Influence who comes, via reserved routes and by attracting people who already have status. A net fiscal position that moves with relative earnings growth.

Would require reserved change. The title. A Scottish immigration system, control of the main tax heads, and a distinct deportation statute.

Colour mark: red. The barrier is Schedule 5, not competence inside a devolved brief. Red is not an argument that independence is required, desirable, or sufficient. It states that this package is not available under the current Act.

What this item does not settle. It does not choose a migration number. It does not claim that possession of the powers would raise or lower inflows, tax receipts or removals. It does not treat every homelessness application as an immigration failure — the 2012 duty is Scottish. It does not treat a 9 per cent non-British prison flow as a crime rate. It does not say ECHR withdrawal is a Scottish option.

The working test is whether the institution that faces the housing queue, the prison wing and the Budget shortfall is the same institution that writes the visa, the allowance and the deportation order. Under the Act, it is not.

Connection

Item 7 depends on the reserved visa for residual shortages. Item 8’s bills sit inside reserved energy and a reserved tax mix. Housing and justice items carry the operational load of reserved inflows. Public finances are the Fiscal Framework above. The Independence Debate is the only place where borders, the full tax base, currency and state succession are designed together. This item records that they are not designed in Holyrood now.

People’s Future Scotland