The Scottish Government will be able to “top up” tax credits and child benefit payments as part of new powers coming to Holyrood, Scottish Secretary David Mundell has confirmed.

The Conservative MP said that the Scotland Bill, which is currently going through Westminster, would be a “game-changer” that would usher in a “new era of devolution”.

For the first time MSPs will be able to set income tax rates and bands as a result of the proposals and will also get new powers over welfare - with these to come into force from April 2017.

Mr Mundell insisted: “We are on the threshold of a new era in devolution and the Scotland Bill will be a game-changer.

“Scottish Government ministers will be able to design a significant part of Scotland’s welfare system and control income tax to pay for it. If they want to top up existing benefits, they will be able to. If they want to introduce payments to those in short-term need or design new benefits in those welfare areas being devolved that will also be an option available to them.

“Powers in the Scotland Bill ensure Scottish Parliament will have the means to pay for any changes, but it will have to justify them to the public, as under the new arrangements, income tax raised in Scotland will stay in Scotland and be spent in Scotland.”

He added: “I am looking forward to today’s meeting between UK and Scottish Government ministers. They have always been collaborative and productive and good progress has been made in working together to implement the welfare aspects of the Scotland Bill.

“Increasingly, welfare will become a shared space between the UK and Scottish Governments and it is vital we continue to co-operate to make sure we deliver the best system we can for the people of Scotland.”

However, the Scottish Government has insisted it will not recommend that MSPs approve the legislation if ministers believe the funding arrangements linked to the bill are unfair.

The SNP has also been critical of UK government plans to cut tax credits for working families, with talks due to take place today between the two governments on welfare.

The Scottish Government is today launching a paper on how the new social security powers that are being transferred north should be used, with social justice secretary Alex Neil pledging: “The new system will have at its heart a set of principles and values.”

Mr Neil said: ““It is clear we must provide people with relevant information so they are aware of how the system will work for them and how long decisions will take.

“It is also important that the system is fair and efficient – that the investment we all make in social security is well managed and is directed at the people who need it, in the way that will support them best.”

The Scottish Government will publish a further paper by the end of the year setting out its outline vision for social security in Scotland.

Meanwhile 15 more jobcentres across the UK have started offering Universal Credit.

From this morning, all new single claimants applying for unemployment benefits at jobcentres Ayr, Girvan, Port Glasgow and Greenock will start claiming Universal Credit.