Scotland’s block grant is the one key issue governments are at loggerheads over in fiscal framework negotiations, says John Swinney

The adjustment to Scotland’s block grant is the one “persistent” issue which the UK and Scottish governments cannot agree on, Scotland’s Finance Secretary John Swinney has told MSPs.

Appearing in front of the Scottish Parliament’s Devolution Committee, Swinney said both sides had made compromises and an “acceptable” agreement had been reached over previously thorny issues like welfare administration costs and proposals over the crown estates.

However the block grant adjustment “remains the standout issue” where the governments disagree.

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“Nothing is agreed until everything is agreed,” he said.

In the unionist cross-party vow on further devolution made before the referendum on Scottish independence a commitment was made to maintain the Barnett formula for adjusting the block grant.

Then the Smith Commission on further powers ahead of the Scotland Bill recommended an agreement be of “no detriment” to either England or Scotland.

“There remains a fundamental difference on the principle of no detriment. I believe that no detriment means that our budget should not be cut as a consequence of the devolution of these powers. The UK government takes a different view," Swinney told the committee.

Treasury minister Greg Hands, who leads the negotiations for the UK Government has said the Scottish Government's demands are not fair or logical.

Swinney suggested the only way to reach an agreement may be for Prime Minister Nicola Sturgeon to meet with the Prime Minister David Cameron.

Cameron has said that any deal must be fair to taxpayers across the UK as well as those in Scotland.

Scottish Secretary David Mundell will give the UK Government’s view to the committee tonight.