Wales Bill

2nd reading (Hansard): House of Lords
Monday 10th October 2016 Lords Chamber

Second Reading

15:08

Moved by

[Lord Bourne of Aberystwyth]

That the Bill be now read a second time.

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, I am pleased to be here today to open this important debate on the Wales Bill. It is an open question when Wales began its devolution journey. Some would begin with the creation of the post of Secretary of State for Wales in 1964 and the establishment of the Welsh Office in 1965, but for many Welsh devolution began in earnest with the referendum in 1997. Parliament has legislated on Welsh devolution three times since then, in 1998, 2006 and 2014, with each Act seeing an incremental change to the Welsh devolution settlement.

I think it is fair to conclude that Welsh devolution has never achieved a settled state. On the one hand this dynamism is positive, and has encouraged an ongoing and open debate about Welsh devolution and Wales’s place in the wider United Kingdom. On the other, the fluidity of Welsh devolution has distracted from focusing on the issues that really matter to people—the economy, jobs and public services in particular.

Back in 2011, the coalition Government established a process to develop a stable devolution settlement for Wales for the longer term. They set up the independent Silk commission, led by Sir Paul Silk, to review the financial and constitutional arrangements in Wales. For me personally, this Bill represents at least in part the culmination of those three years of work that began at the time the Silk commission started in 2011, when I was a member, at the request of the then Secretary of State for Wales, my right honourable friend Cheryl Gillan. Many of the recommendations in the commission’s second report are being implemented in the Bill.

After the commission concluded its work, the former Secretary of State for Wales established the St David’s Day process to identify those recommendations in the second Silk report which commanded a consensus across the parties in Wales. The outcome of that process, the Saint David’s Day agreement, published in February 2015, forms the blueprint for the Bill.

At this point, I thank both my right honourable friend Stephen Crabb, the then Secretary of State for Wales, and the noble Baroness, Lady Randerson, who played a significant part in framing the work that has gone into the Bill and taking it forward.

The Bill delivers a clearer and stronger Welsh devolution settlement and an Assembly and Welsh Government more accountable to the people they serve. Welsh devolution will be clearer by implementing a new reserved powers model, providing a well-defined boundary between what is reserved and what is devolved. It will be stronger by devolving further powers to the Assembly and Welsh Ministers in areas such as elections, the Assembly’s internal processes, transport, energy and the environment. The Bill makes the Assembly and Welsh Government accountable for raising more of the money they spend by paving the way for the introduction of Welsh rates of income tax without the need for a referendum.

The Assembly and Welsh Government have come of age. They are now mature institutions and part of the fabric of Welsh political life. The Bill recognises this new maturity in some key ways. First, the Assembly and Welsh Government are recognised as permanent parts of the United Kingdom’s constitutional arrangements, not to be abolished unless the people of Wales decide in a referendum in favour of doing so. This statement recognises what we all know to be true: that the Assembly and Welsh Government are part of the United Kingdom’s constitutional fabric and are here to stay.

Secondly, the Bill gives important recognition to the body of Welsh law made by the Assembly and Welsh Ministers, forming part of the law of England and Wales. Thirdly, it puts the convention on legislative consent on a statutory footing, as is already the case for Scotland, making clear that Parliament will not normally legislate on devolved matters without the Assembly’s consent.

The constitutional debates of recent years demonstrate the need to reset the devolution settlement for Wales. We all want an end to the incessant squabbles over powers between Cardiff and Westminster and to see Welsh devolution set on a firmer foundation, enabling the Welsh Government to focus on the things that really matter to people—improving the Welsh economy, securing more Welsh jobs and improving devolved public services.

We need to move to a new way of thinking about Welsh devolution based on a reserved powers model. By implementing this new model, the Bill provides for a clearer and more stable settlement that will last for the longer term. Anything not reserved to the UK Government is devolved, and the Assembly will be able to legislate on it.

The new reserved powers model of Welsh devolution has been the subject of a great deal of public debate over the last year since the Government published the Wales Bill in draft. My right honourable friend the Secretary of State for Wales, his predecessor, the right honourable Member for Preseli Pembrokeshire, and I have discussed the Bill’s provisions with many who have an interest in the future of Welsh devolution. We listened to the concerns expressed during that debate about aspects of the draft Bill, and we have acted on them.

The Bill before us today is significantly improved from the one we published in draft. It includes a list of reservations that is shorter, with more precisely drawn boundaries. It contains fewer tests for legislative competence, and it gives the Assembly more discretion to enforce its legislation by being able to modify the private law and criminal law for devolved purposes.

A key part of delivering a clear devolution boundary is defining which public authorities are devolved and which are reserved. The Bill defines those public authorities that are devolved public authorities accountable to the Assembly or Welsh Ministers. It describes those authorities as “Wales Public Authorities” and lists them at Schedule 3 to the Bill. All other public authorities are reserved authorities, accountable to Parliament or United Kingdom Ministers. The Assembly can legislate on reserved authorities only with the consent of United Kingdom Government Ministers. It is surely right that the consent of United Kingdom Ministers is sought in order for the Assembly to modify the functions of a body accountable to UK Ministers.

The Bill, and accompanying secondary legislation, will also provide clarity on how so-called pre-commencement Minister of the Crown functions are to be exercised in future. For those noble Lords unfamiliar with this term, let me explain that “pre-commencement” functions are functions exercised in devolved areas by Ministers of the Crown before the Assembly assumed full law-making powers following the 2011 referendum. We want to be clear how such functions are to be exercised under the new reserved powers model.

Last week, I wrote to noble Lords with an indicative list of those functions we intend to transfer by order. Most functions not subject to transfer will be exercised concurrently or jointly by Ministers of the Crown and Welsh Ministers. The Bill lists those functions at Schedule 4. There remain a handful of functions which Ministers of the Crown will exercise alone. Those are listed at paragraph 11 of Schedule 2.

I shall now say something about the single legal jurisdiction of England and Wales, which was an important part of the debate around the draft Bill. There were some who questioned whether a reserved powers model for Wales could work within the shared jurisdiction of England and Wales. There was a great deal of debate about whether Wales would be better served by a separate legal jurisdiction. Some favoured a distinct jurisdiction with largely autonomous arrangements for Wales, although common agreement on what is a distinct jurisdiction proved elusive.

The Government listened carefully to the concerns raised, but we have been clear and resolute throughout that the single legal jurisdiction of England and Wales has served both nations well for centuries and continues to do so. We do not intend to modify that. The single jurisdiction can readily accommodate a growing body of Welsh law without the need for separation, and there are many reasons why separation would be detrimental to Wales.

Of course, Wales has a distinctive legal identity. I think we would all recognise that. It has two legislatures and a growing body of law made by the Assembly and Welsh Ministers—a fact that this Bill recognises formally for the first time. This recognition is important, but let me assure the House that it is set firmly in the context of maintaining the single legal jurisdiction of England and Wales. The Bill enables the Assembly to modify the private law and criminal law for devolved purposes, enabling the Assembly to create offences to help enforce its legislation, as it does now. The Assembly will not be able to modify a small number of the gravest offences, such as homicide offences and sexual offences, ensuring consistency across the England and Wales single legal jurisdiction.

Of course we need to adapt to the growing body of Welsh law created in the Assembly and by the Welsh Ministers. That is why the Government have established a working group of officials to examine how administrative arrangements for justice in Wales can be improved. I look forward to informing the House of the group’s findings later in the autumn. I should also say that I have written to both the Ministry of Justice and the Department for Education, encouraging action to ensure that law schools throughout England and Wales take account of the growing body of Welsh law and that that devolved element is taught as part of law courses and is carried forward into professional courses as well, such as those for the Bar, solicitors, legal executives, and so forth.

The Bill delivers more accountable, devolved government for Wales. With the coming of age that I have already talked about comes renewed responsibility and a need for the Assembly and Welsh Government to become truly accountable. A key element of this is removing the need for a referendum to introduce Welsh rates of income tax, which will mean that the Welsh Government can take on more responsibility for how they raise money as well as how that money is spent. It gives the Government an interest in ensuring that the economy in Wales is performing well. The reward for that will redound to the Welsh Government, who are being given this power to exercise for a purpose consistent with the mandate of a particular Welsh Government.

Tax-raising powers are a key part of the Assembly truly becoming a Parliament. The Wales Act 2014 devolves stamp duty and landfill tax; we took forward the full devolution of business rates in April last year. The devolution of Welsh rates of income tax—not all income tax, of course, just 10p—will complete the process of fiscal devolution for Wales as set out in the 2014 Act, delivering truly accountably devolved government for the first time.

The Bill makes Welsh devolution stronger by devolving a significant package of new powers to the Assembly and Welsh Ministers. These are powers for a purpose, giving the Assembly and Welsh Ministers the tools to improve the day-to-day lives of people in Wales. The Assembly and Welsh Ministers will have strengthened powers over transport in Wales, including speed limits and traffic signs on Welsh roads; the registration of bus services; and the regulation of taxis and private hire vehicles. We are devolving policy over ports in Wales, apart from Milford Haven, which is of strategic importance to the UK state. Welsh Ministers will decide, too, whether energy projects in Wales up to 350 megawatts generating capacity should be built. Decisions on whether fracking takes place in Wales will in future be made in Wales. We have already devolved all onshore wind consents in the Energy Act—that is without limit. Noble Lords will recall that I took that through this House earlier this year.

On the environment, the Bill will devolve new powers over marine licensing and marine conservation zones, as the Silk commission recommended, and we are continuing to consider the outcomes of the work between the UK Government and the Welsh Government, looking at the devolution boundary for water and sewerage, with a view to taking that forward.

Finally, but significantly, the Bill also gives the Assembly control over its own affairs—something that, arguably, should have happened some time ago—including elections to the Assembly itself, the franchise, and the electoral system for Assembly elections and the number of Assembly Members. Importantly, the Assembly will be able to decide what it should be called. If the Assembly wishes to rename itself the Welsh Parliament, for example, as many would consider appropriate, it will be able to do so. That reflects the maturity of the Assembly, which I spoke about earlier. It is only right that the Assembly should be responsible for these issues in Wales, just as the Scottish Parliament now is in Scotland. These new powers deliver a powerful legislature for Wales, irrespective of what it decides to be called. Welsh Ministers will have new levers to improve the economy and public services in Wales, and important new responsibilities over natural resources and the environment.

I know that many here today will want to speak, and I look forward to hearing an interesting and stimulating debate from people who know a great deal on the subject of devolution in Wales. I will conclude by saying that the Bill sets the course for a stable and lasting devolution settlement for Wales. It builds a new Welsh devolution settlement on the solid foundations of a reserved powers model. It is much improved on the draft of a year ago. I commend it to the House.

15:23

[Baroness Morgan of Ely (Lab)]

My Lords, I am a little overwhelmed and daunted by the fact that I am speaking on the Wales Bill from the Front Bench with no fewer than five former Secretaries of State going to participate today, on top of other Welsh constitutional experts who have been involved in Welsh politics since before I was born.

I am also aware that the Minister leading for the Government was the principal architect in ensuring that the Conservative Party dropped its opposition to devolution in Wales and engaged constructively in the process, and for this he deserves to be commended. In addition to this, he made a distinguished and valuable contribution to the Silk reports, which of course were supposed to have served as the basis for this Wales Bill. Because of my great respect for the Minister, I will make every effort to resist the temptation to ask him why he has changed his mind on so many issues since his transformation from being a key member of the Silk committee to becoming a Welsh Minister.

I declare my interest in this Bill as an elected Member of the National Assembly for Wales. I will start by being kind: the Minister is correct that this Bill is a considerable improvement on the draft Bill introduced in October 2015, which was so fundamentally flawed that the Government had to withdraw it in the face of almost unanimous criticism of its viability. The necessity test in relation to private and criminal law has now been removed, there has been a reduction in the number of reserved areas and there is improvement in the system for Minister of the Crown consents. We welcome the fact that the National Assembly for Wales will be permanent, and that it will now have power to determine its own electoral processes, its size and the electoral system for National Assembly elections. We welcome the fact that, among other things that the Minister outlined, the Assembly will have enhanced powers in energy projects, including fracking, and new transport responsibilities. We are also pleased that the changes were made in response to scrutiny of the draft Bill, and I am particularly pleased that social care regulation and inspection will be under the control of the Assembly, following my call for the establishment of a national care service for Wales last week.

But—and this is a huge but—the Bill in its current form is complex, inaccessible, unclear and will not settle the devolution issue for Wales as was the intention. There has been a failure to incorporate any fundamental or firm constitutional principles within the Bill, such as clarity, stability, legitimacy and subsidiarity. It is poorly drafted and ill conceived. The opportunity to introduce a consolidated Bill, which would have meant that there would no longer be a need constantly to refer to previous Government of Wales Acts, has been missed. The lack of clarity means that there are some significant points where there will still be a need to refer to the Supreme Court to seek clarity on where power should lie—a costly and unnecessary exercise.

We believe that the Bill has been rushed, to no clear purpose, and goes against the spirit, expressed in the Bill, of “collaborative working”. It also fails in its aspirations, which were set out in the St David’s Day proclamation, for a durable and lasting settlement. The unwillingness of the UK Government and Whitehall departments to deliver a settlement that matches the clarity and accessibility of other devolution settlements, in Scotland and Northern Ireland, is also disappointing. I am sure that the Minister will have taken note of the severe criticism of the Bill published by the Constitutional Affairs Committee of the National Assembly, most notably, perhaps, its assertion that for the first time ever there is a rollback of current powers vested in the National Assembly.

We are living in extremely turbulent political times. The EU referendum has thrown the whole legislative framework of this country into turmoil. The pressures on the unity of the union will be tested severely in the next few years as we extract ourselves from the European Union. This constant piecemeal approach to constitutional developments in Wales is disrespectful, and the Government need to call a constitutional convention to prepare a route map in order to keep our United Kingdom together. This constant nibbling away at the constitution will ultimately erode the unity of the United Kingdom and will create divisions more emphatic than the ones which we have just witnessed with the EU referendum.

Integral to the Bill is a recognition that Bills proposed by the UK Government which will impact on National Assembly legislative competence will no longer be allowed to pass in both Houses of Parliament unless they receive the consent of the Assembly by means of a legislative consent Motion. Let me be as clear as I can be: the Government absolutely must respect the view of the National Assembly in relation to this Bill, and in particular the outcome of the legislative consent Motion. We know that central to this will be the need to come to a definitive position on the fiscal framework for Wales. This fiscal framework will need to give an absolute reassurance, not just to Assembly Members but to the public in Wales, that the country will not be worse off financially, now or in the future, if we were to adopt some of the measures suggested in the Bill. This is particularly true in relation to the devolution of income tax. We need an assurance that we can borrow significantly against any income tax devolved, and that we would not get a worse deal than Scotland. It would give us a great deal of reassurance if the Minister could today assure us that the opinion of the National Assembly will be respected in relation to this Bill.

Some parts of the Bill require additional work. There is no point in the Assembly being able to make laws if it then has difficulty enforcing them. It would be useful to have greater clarity on the scope of the Assembly’s ancillary powers to enable it to make laws which are effective and enforceable. Areas in the Bill where unnecessary potential interference is suggested simply seem heavy-handed. This will require intensive intergovernmental working with additional bureaucracy and administration, which contrasts with the Government’s own commitment, and that of the Silk commission and the Richard commission, to the need to cut constitutional red tape. There is an urgent need to strengthen intergovernmental and interparliamentary relations, as has been suggested on more than one occasion.

It is a shame that the Bill has not aligned legislative and executive competence more closely, and that there continues to be reliance on transfer of functions orders. We cannot understand this, and we look forward to the Minister justifying why all functions currently exercisable by a Minister of the Crown within devolved areas cannot be devolved and transferred to Welsh Ministers.

I am aware that there is real disquiet on our Benches about the introduction of income tax powers without the need for a referendum. I know that many noble Lords will want to pursue this issue with vigour.

As the Minister suggested, England and Wales share the same legal jurisdiction. Since 2011, however, a body of Welsh law has already been built which is distinct from that of England and Wales. Given the very low number of Welsh-only laws, we believe that currently it is unnecessary to establish a separate legal system. However, we believe that in time complexities relating to the training of judges and lawyers will need to be considered. The accessibility of the law to ordinary citizens is also paramount. We believe, therefore, that it is necessary to insert a clause requiring the UK Government and the Welsh Government to keep the situation under review.

The move to a reserved powers model is something which in principle we welcome. We had hoped, however, that this would deliver the “clarity, coherence and stability” which the Government had announced was the intention of the settlement. While I believe that we have to accept that there are some areas where introducing a reserved powers model would smooth out the creases of the current devolution settlement and give clear lines, the system is more difficult to accept if the consequence is the rolling back of the powers of the Welsh Government in areas which have hitherto been “silent” areas, where the Welsh Government have consequently been able to act.

One of the worrying aspects of the move to the reserved powers model is that, if a matter “relates to” a reserved matter, it is not within the Assembly’s power to legislate. The question of how a provision will be assessed when deciding whether it “relates to” a reserved matter will be determined using a “purpose test”—in other words, whether the purpose of the provision is devolved or not. We will seek a great deal more clarity on the issue of the purpose test in Committee.

As I suggested, while in principle we agree with the move to a reserved powers model, the next question is, inevitably: do we agree and accept all the areas where the UK Government have insisted on retaining power to themselves? We accept and welcome that the list has been reduced since the draft Bill, but we have noted some attempts to reduce the list by lumping some subjects together which were previously counted individually. For example, architects, auditors and health professionals were previously three categories; now all three are included in one category.

We were promised a more comprehensive rationale and justification for why certain areas were reserved, and we do not believe that the Explanatory Notes currently provide the reasoning that we seek. I will do what I can to stop Members on the Labour Benches from putting amendments down on every reservation so that the Government will have to justify each one on the Floor of the House. However, noble Lords might have noticed that I have some pretty heavy hitters on my side, and I may not be able to stop them. Therefore, if the Minister can come up with better justifications for those reservations prior to Committee, we will be grateful.

It is also worth emphasising that it is not simply a matter of reducing the number of reservations on the list in new Schedule 7A; we should like to see some of the reservations redrafted or exceptions added so that the breadth of the reservations is limited, creating more legislative space for the Assembly in which to act. At this stage I will give just a few examples of where we have some concerns: employment matters with regard to devolved public services; licensing and the sale of alcohol; the community infrastructure levy; railway franchises; and water, which I need not emphasise the sensitivity of since the construction of the reservoir at Tryweryn.

In its current form, the Wales Bill is wholly unsatisfactory. We are disappointed that it has been rushed, both in drafting and in the depth of scrutiny, and in some instances we are seeing powers being taken away from Wales. The people and the businesses of Wales have the right to know and to understand the constitutional and legal framework under which they live and work. In these uncertain and unstable political and economic times, now, more than ever, people need a clear understanding of where responsibility lies. The Bill does not give us that clarity. It is a real shame that the democratic will of the people of Wales, as expressed in particular in the 2011 referendum, has been missed, that the opportunity to produce an aspirational settlement has been missed, and that the chance to produce a vision for the future direction of Wales has been missed.

Despite this, I reassure the Minister that we are well disposed to working with him during the passage of the Bill, and we hope that he will accept our interventions in the spirit of ensuring that we produce the best possible Bill for the people of Wales.

15:38

[Baroness Randerson (LD)]

My Lords, we welcome the arrival of the Bill, which is in much better shape than the original draft Bill presented last year.

To those of us closely associated with the devolution process the journey towards an effective settlement—towards my party’s aim of home rule for Wales—is achingly slow. I disagree with the noble Baroness, Lady Morgan; there has not been enough rush over devolution. We are certainly not yet in a situation where we can say that we have a firm, decisive devolution settlement, but we are shuffling steadily down the road towards it. Therefore noble Lords will forgive me for becoming somewhat impatient with what I regard as a slow process. However, I acknowledge that in the big scheme of history, the 17 years since the establishment of the Assembly are just the blink of an eye, and therefore as ever I am pragmatic. Any step forward must be welcomed and built upon.

However, I am disappointed that the Bill still does not provide the clarity, coherence, stability, workability and sustainability set out by the previous Secretary of State for Wales, the right honourable Stephen Crabb. Looking back over the last 17 years, the Assembly that I was elected to in 1999, along with my noble friends Lady Humphreys and Lord German, is almost unrecognisable in comparison with today’s institution. The Minister is well aware of this because of his history in that place and his part in the Silk commission.

I am proud that my party, the Liberal Democrats, has played a fundamental role in the transformation of those powers. In the first Assembly, I was a Minister in the partnership Government formed between my party and the Labour Party. As part of our agreement, the Liberal Democrats insisted on the establishment of the commission led by the noble Lord, Lord Richard. It put forward some bold and imaginative proposals, but several of those remain to be implemented to this day. Sadly, it took far longer than it should have done to implement the recommendation for full legislative powers, which now exist, due to the indignity and bureaucratic nightmare of the legislative competence order system imposed on Parliament and the Assembly. I welcome the indication from the noble Baroness, Lady Morgan, that the Labour Party as a whole is now much more convinced about the importance of devolution than appeared to be when it was in government.

When the Liberal Democrats came to form a coalition here with the Conservatives in 2010, we again made constitutional progress in Wales a priority. The Silk commission was born and many aspects of this Bill owe their origin to the Silk reports. By that time, I was seeing the story from the other side of the fence. As a Minister in the Wales Office it was obvious to me how easy it was to kick reports, such as the Silk reports, around Whitehall and to make frustratingly little progress. No Whitehall department and few Ministers are willing and happy to surrender power, however small and inconsequential that power may be.

However, the ship of devolution in Wales was then blown along in the slipstream of the Scottish independence referendum, and I was confident that we were poised for a big stride forward by St David’s Day 2015. The St David’s Day declaration, on which I worked with the then Secretary of State, was bold, clear and ambitious, and I pay tribute to his sterling efforts to create a cross-party consensus on many aspects of devolution. Of course, there was not 100% agreement—indeed, my own party wanted to go further on some aspects such as devolving powers over policing—but there was a firm basis for agreement.

This Bill fulfils some of the criteria needed to establish the sustainable settlement envisaged in that agreement. The move to a reserved powers model is obviously fundamental but it has not proved to be the easy step that so many imagined. The complex and vague Welsh devolution settlement of 1999, based on conferred powers, has been translated into a less vague but still complex set of reserved powers. I believe that they are still unnecessarily complex and many of them are illogical as well. So, as the Bill goes through the House, I will examine the list of reserved powers and test out why some of those powers are there.

On the issue of the distinct and separate jurisdiction, I do not believe we have come to the point where a separate jurisdiction is desirable or needed. However, we need it to be distinct, and so I am interested in the progress made in the joint working group and what commitments there are on taking forward the outcomes of its deliberations. I am anxious that it will not be used to simply distract us from the main issue. It has to have concrete outcomes that are implemented.

The elephant in the room whenever we discuss Welsh devolution is the issue of fair funding and the Barnett formula. This has been the case ever since the Assembly was established in 1999. I look forward to hearing details of progress on this issue because significant progress is key to the effectiveness of the Bill.

I welcome the additional powers set out in the Bill, but there are more powers that we would like to see. I have already mentioned policing because, after all, the cost of policing is more or less shared equally between the Home Office, the Welsh Government and local government in Wales. It is not unreasonable, therefore, to expect the powers over policing to be devolved. There is no constitutional reason why air passenger duty should not be devolved. If Scotland and Northern Ireland can handle it, it is unjust to say that Wales cannot have that power simply because Bristol airport has run an effective lobbying campaign. We cannot see, for example, why Milford Haven is excluded from the list of devolved ports. I know it is a trust port—that is the technical aspect of it—but I cannot see why it is the exception among all Welsh ports.

We believe that the Assembly’s powers over energy will still be too limited. The 350 megawatts limit is an artificial one. It is based on a Silk commission recommendation, but nevertheless it has possibly been overtaken by events. The figure was picked because it was based on the size of the Swansea tidal lagoon, which I regret to say this Government seem to have abandoned anyway.

There is much to support in the Bill such as the permanence of the Assembly, giving it powers over its own affairs and elections, its size, its name and so on, thus treating it as a grown-up body. I welcome strongly the powers to vary income tax without the need for a referendum, behind which it was clear that the Welsh Government were going to hide. Having worked within the UK Government, I understand some of the caveats. However, I also understand that some of those caveats can be misused and need to be tested in this House.

This Bill is the product of a previous, pro-devolution Government. I do not believe the same can be said of the current Government, with the exception of the noble Lord the Minister sitting opposite. As a pragmatist, I am keen to support the Bill and to push devolution as far as possible, because, after all, this is all we are going to get for a while at least. It brings via the reserved powers model greater clarity. However, it does not bring greater simplicity to the Assembly and Welsh Government’s powers, and it does not widen their powers to the extent that we as Liberal Democrats would wish.

15:49

[Lord Crickhowell (Con)]

My Lords, I begin with some general thoughts, some of which have been touched on by both noble Baronesses who have spoken. The Constitution Committee of this House, in its report The Union and Devolution, drew attention to the way in which power has been devolved to Scotland, Wales and Northern Ireland in a piecemeal fashion, without proper consideration of the cumulative impact of devolution on the integrity of the United Kingdom. The committee concluded:

“The Government needs fundamentally to reassess how it approaches issues relating to devolution. What affects one constituent part of the UK affects both the Union and the other nations within the UK … The new mindset will require abandoning a ‘devolve and forget’ attitude. Instead the … Government should engage with the devolved institutions across the whole breadth of government policy, co-operating and collaborating where possible. In particular, the Joint Ministerial Committee should be reformed to promote co-operation and collaboration, rather than grandstanding and gesture politics”.

That was the view of the Select Committee. It commented that,

“to perpetuate the use of the Barnett Formula, which takes no account of relative need, makes a mockery of the Government’s duty to ensure a fair distribution of resources across the UK”.

In an earlier report, Inter-governmental Relations in the United Kingdom, produced when I was a member, the committee expressed the hope that,

“the increasing complexity of the devolution settlements will spur greater parliamentary scrutiny of inter-governmental relations, aided by a more transparent JMC and improved departmental reporting”.

The Select Committee on Economic Affairs, in its report A Fracturing Union? The Implications of Financial Devolution to Scotland, agreed with the Constitution Committee that,

“retention of the Barnett Formula is the wrong decision”.

It said:

“In future, HM Treasury needs to be much more transparent about how funding is allocated to Scotland, Wales and Northern Ireland and an independent body such as the Office for Budget Responsibility should scrutinise this and the operation of the fiscal framework. There is also too little Parliamentary scrutiny of the funding arrangements. The UK and devolved legislatures should co-operate to remedy this”.

The committee suggested that,

“a decision to devolve nearly all revenue, uniquely amongst countries in a similar position to the United Kingdom, has been adopted with undue haste and little assessment of the economic and political consequences. It may not be clear to people in Scotland”—

I add, “or in Wales”—

“how they fund reserved services and which Government is accountable for them”.

All these conclusions and recommendations form a useful starting point for our consideration of the Bill, along with the thought that almost all modern Acts of Parliament are too long and complex and therefore do not provide clarity where it is needed. However, at this point I pay tribute, as my noble friend Lord Bourne has already, to the former Secretary of State for Wales Stephen Crabb for the role he played in the preparation of this Bill and for the manner in which he consulted and took account of the suggestions and criticisms made in its preparation—a process that has been continued by the present Ministers. We have had the Wales Act 2014, the report of the Silk commission Part 2, the St David’s Day process, the publication of a draft Bill, and pre-legislative scrutiny by the Welsh Select Committee in another place and other interested parties, as well as the passage of the Bill through the Commons, albeit with a somewhat hasty Committee stage. All this represents a great improvement on some of the earlier steps along the devolution trail.

I will refer only to a few matters to which we seem certain to return later. Employment and industrial relations policy has not been devolved. I understand that the noble Lord, Lord Hain, who is to speak immediately after me, is likely to table an amendment to remove devolved public services in Wales from the reservation. I will support the Government if they resist that amendment.

The joint government review of the Silk recommendation that legislative competence for water be aligned with the national border was completed in the summer, and the Government have still to present their decisions. Based on my experience as chairman of the National Rivers Authority, I have considerable doubts about the good sense of the proposal, but I will reserve judgment until I know the conclusions of the review and the decisions taken by government.

The Minister has already made it clear that the maintenance of the single legal jurisdiction of England and Wales remains a red line for the Government. They will have my total support for that position, but the working group of officials, including those from the Lord Chief Justice’s office and the Welsh Government, is considering the implication of diverging Welsh laws within the justice system and the need for distinctive arrangements to reflect the emerging body of law made by the Welsh Government. Once again, I will reserve my final judgement on the detailed arrangements—which, we have been told, will be presented to us later in the autumn.

Another government red line concerns crime, public order and policing. While I understand and am sympathetic to the general principle underlying the Government’s stance, I hope that Ministers will be able to explain why they appear to be giving powers over policing to some English city regions while not granting them to the Welsh Government.

The noble Lord, Lord Rowe-Beddoe, a particularly good friend of mine, may not be pleased when I say that I am also with the Government in their opposition to the devolution of air passenger duty. I suppose that I should declare an interest as I fly more frequently from Bristol than I do from Cardiff—but it would be wrong to distort competition between two airports that are in such close proximity.

The Government say that discussions between HM Treasury and the Welsh Government on the fiscal framework are ongoing and that it would not be appropriate to place block grant adjustments on a statutory basis. I have already referred to the need for openness and parliamentary scrutiny. I hope that we will be given a great deal more information about the fiscal framework before we take the Bill much further.

It is all too clear from what has been said that in Committee and on Report there will be a great deal of vigorous argument about the reservations. We have moved to the reserved powers model, but the number of reservations is still lengthy. Although Stephen Crabb reduced the original list very considerably, I wonder whether we cannot do still more. We have been told that a “roll back” of the Assembly’s legislative competence may have taken place. The National Assembly’s research brief raises legitimate questions that deserve a response. In a letter to the Secretary of State in June, the First Minister wrote:

“You need to press Whitehall Departments to focus on the issues that really do need to be dealt with on an England and Wales or UK level; this requires a laser-like focus rather than a blunderbuss”.

All this takes us back to the general points that I made at the beginning of my speech about the need for simplicity and a new mindset. The Wales Office has done stalwart work, but Ministers must ensure that every government department is equally committed to the process. It will be greatly to the credit of the Government if in the Lords we are able to clarify, simplify and improve the Bill even more than it has been improved already.

15:59

[Lord Hain (Lab)]

My Lords, I agree with a great deal of what the noble Lord, Lord Crickhowell, said, especially on transparency over the proposed fiscal framework. That is a critical issue.

Although I welcome parts of the Bill, and although, as the Minister said, the Government responded to very strong objections to the draft Bill, it still feels that the way in which the reserved powers have been drafted repatriates powers back to the United Kingdom, for there are around 190 exceptions to the reserved powers to be granted to Wales. For instance the Assembly’s Agricultural Sector (Wages) Act 2014 would not be permitted under this Bill. Yet the Assembly not only passed it but also overcame a challenge from the UK Government when the Supreme Court found in their favour, enabling it to be placed in statute. How can this be progress towards empowering the Assembly? It seems more like a Whitehall grab-back of powers, as indeed the Welsh Assembly’s Constitutional Affairs Committee argued last week and as, among others, my noble friend Lady Morgan of Ely and the noble Lord, Lord Elystan-Morgan, recently argued publicly.

However, I wish to focus upon my two main objections at this stage to the Bill—objections I raised with the Minister during the courteous briefing that I thank him for providing before the conference recess. First, there is the question that I and my noble friend Lady Morgan of Ely discussed in detail in this House during the passage of the Trade Union Bill: the undermining of the fundamental workings of the devolution settlement by dictating the manner in which industrial relations within devolved public services in Wales are configured. This Bill reinforces that and it is a matter of dispute with the Welsh Government because the Assembly will shortly have before them a Bill which exempts devolved public services from the Trade Union Act. Since that has been supported by Labour, Liberal and Plaid Cymru Assembly Members it will likely be carried by a large majority. I will return to this matter.

Meanwhile, my other major objection is that Clause 17 of this Bill removes sections of the Wales Act 2014—just two years ago—that retain the requirement which has existed since 1997 that a referendum will be required to implement the powers to vary income tax under that Act. That is constitutionally unacceptable, even outrageous. In September 1997, as a Welsh Office Minister I helped to lead the Government’s campaign to win the referendum to establish the Welsh Assembly. With due respect, I do not recognise the comments of the noble Baroness, Lady Randerson, that Labour has been a back-marker on devolution; we introduced the Welsh Assembly and empowered it in the 2006 Act.

There was only one question before voters in 1997: did they want an Assembly or not? There was no second question on whether they wanted income tax devolved, as was specifically and importantly the case in the referendum on a Scottish Parliament. Ministers at the time took the view that to have such a second question in Wales would be to lose the referendum. Given how narrowly it was won, with just 0.2%, how wise that turned out to be. Leading politicians of all parties, including Conservatives, have been crystal clear in the past: to devolve income tax powers to Wales would therefore need another referendum like Scotland had on income tax. Indeed, just last year the 2015 Conservative Party general election manifesto committed to a referendum before income tax powers were raised. If your Lordships’ House were to amend the Bill to reinstate the referendum requirement, we would be doing so in line with the Salisbury convention on a government election manifesto commitment.

The current Secretary of State for Wales, Alun Cairns, was a Government Whip and voted for the 2014 Act which put into statute the necessity for a referendum just two years ago. He argued for that, as did all his Conservative MP colleagues at the time. So why have he and the Government done a U-turn after such a short time, thereby breaking their own manifesto commitment of just last year? There has been no clear explanation by Ministers. Could it be that they are frightened that, if invited to vote, a majority in Wales—perhaps a large one—would turn down the powers? I suspect so; otherwise, why be afraid of trusting the voters?

Could it be that the Government wish to ram income tax devolution through without addressing the irrefutable evidence that the way the Barnett formula has operated has short-changed Wales—by at least £600 million annually—in contrast to Scotland? Without a new “Barnett floor”, which the First Minister has insisted upon, and without the fiscal framework he wants, it would be pure folly for Wales to have income tax devolved. I note the point made very powerfully by the noble Lord, Lord Crickhowell, that there should be full transparency on the fiscal framework before Parliament enacts this legislation, amended or otherwise.

Could it be that the Conservative Government have an ideological objective to shrink the Whitehall state, offloading as much responsibility as possible on to individual citizens to fend for themselves, outsourcing to private providers and sub-contracting tax and spending to devolved legislatures? Having strenuously opposed political devolution in the past, the Conservatives now see the virtues of economic devolution in neoliberal terms. In that respect at least, the outcomes, if not the ideologies, of nationalism and neoliberalism can converge, because under both the redistributive power of the United Kingdom state is either severed or stunted.

The incontrovertible advantage of modern Britain is its 20th-century innovation: the pooling and sharing of risks and resources across the whole United Kingdom to ensure common welfare and decent standards of life for all citizens, regardless of nationality or where they live. At the heart of that pooling and sharing of resources has been a set of path-breaking decisions throughout the 20th century: common welfare standards first introduced by Liberal Governments and subsequently consolidated by Labour Governments up until 2010, ensuring common economic and social standards; common UK-wide old-age pensions; common UK social insurance—sick pay, health insurance, unemployment insurance and labour exchanges; common UK child and family benefits; a common UK national minimum wage; and a UK system of equalising resources so that everybody, irrespective of where they live, has the same political, social and economic rights, not just equal civil and political rights.

Pooling and sharing the UK’s resources has also enabled redistribution from richer to poorer parts of the UK, whether constituent parts of a nation such as the coalfield communities of the south Wales valleys or regions of England such as the north-east. Although the Holtham commission, in its case for devolving limited tax-varying and borrowing powers to Wales, set out complex compensating arrangements which attempted to ensure that Wales did not fall behind richer parts of the UK, it could not guarantee that the Treasury would always deliver this. We wait to see whether the First Minister has been able to secure that in his negotiations with the Government on a fiscal framework.

With around 40% of UK GDP concentrated in London and the south-east of England, I have seen no answer—whether from Ministers or, indeed, in this respect at least, separatists—to what is at the heart of the case for maintaining the integrity of the UK: redistributing resources from better-off to less well-off parts; and guaranteeing equal opportunity and security for all UK citizens regardless of nationality, race, geography, gender, sexuality, age, disability or faith. That has meant, as former Prime Minister Gordon Brown showed in his book My Scotland, Our Britain, that while inside the European Union the average income of the typical citizen of the poorest country is just 20% of that of the richest country, and in the USA the income of the poorest state is 55% of that of the richest, the average income of the typical Scot is 96% of the average income of an English citizen; for Wales, the figure is 87%.

In a post-World War II settlement subsequently maintained by the Conservatives, at least until recent times, Labour created a set of universal rights: free healthcare across the UK in the 1940s; and in the 1990s a UK-wide minimum wage and a tax credits system which discouraged the regions and nations from undercutting each other in a race to the bottom. A cornerstone of our social rights is the common UK welfare system, which transfers resources between individuals, dependent on their circumstances, right across the union. Pooling and sharing of resources at UK nation-state level must be sufficiently strong so as to continue to guarantee free healthcare, the rights to a pension when elderly, help when unemployed, sick or disabled, a decent family income and universal education, as well as defence and security. There is an implicit UK government guarantee that nobody in the union—whether in Wales, Scotland or elsewhere in the UK—can be prevented from accessing those common social and economic rights, and the services that flow from them, by reason of a shortage of resources.

That is why it is right that all UK taxpayers—English, Welsh, Scottish and Northern Irish citizens together—contribute their taxes at a UK level to fund these common rights and services, thereby guaranteeing that the UK Government and, where appropriate, the Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly, have the capacity to deliver them. With England constituting 84% of UK population and 87% of UK GDP, it would be mad for Wales to cut itself off from that, just as it would be mad for the north-east of England, with its similar GDP per head and demographic, to cut its income off from the rest of England—especially the south-east, which, as I pointed out earlier, contributes something short of half the UK’s wealth. This is especially serious for Wales, which has a huge net fiscal deficit involving a massive annual subsidy from the UK Treasury, estimated by the Library at £14.7 billion in 2014-15. That total, by the way, is similar to the entire Welsh Government block grant. I believe that this Government are encouraging an offloading of the centre’s responsibility to all its citizens—English, Scots, Welsh and Northern Irish—and, by design or default, encouraging separatism. For if the UK does not offer common rights and resources to enable universal access for each citizen, why should they offer their loyalty to the UK in return?

In making this argument, I remind your Lordships that I have been a consistent devolutionist all my political life. As the author of the Government of Wales Act 2006, I was proud to deliver the full law-making powers that the Welsh Assembly has enjoyed for some five years now, to the great benefit of its citizens. Therefore my objection to Clause 17 repealing the Government’s very own clause of just two years ago, committing to a referendum, is on two grounds. The first is constitutional and democratic. Surely it is not acceptable to move the goalposts from a referendum vote in 1997 by denying Wales the chance to have a vote on income tax, like the Scots did. Why should Welsh voters be treated as second class compared with Scots voters? The second is that, in any case, we step at great peril down the road of income tax devolution, the destination of which could be impoverishment in less prosperous parts of the UK, Wales included. Just in passing, while I certainly do not wish to put any ideas into the Conservatives’ minds, what about VAT if we leave the European Union? Membership of the EU means that it cannot be devolved: what does Brexit mean?

Let me turn to the manner in which the Bill will enable one important part of devolved public services in Wales to be dictated from Whitehall, namely industrial relations. I ask the Government to reconsider the manner in which the Bill reserves all employment law to the UK level in respect of devolved Welsh public services alone—not the private sector but just devolved public services. In doing so, and this may address the concerns of the noble Lord, Lord Crickhowell, let me be clear that I am not asking for employment law as a whole—including strikes, unfair dismissal, health and safety, maternity and paternity rights and so on—to be devolved. I agree that the core issues of employment law should be a reserved matter, not least to prevent businesses or devolved governments competing to undermine basic conditions of work in a race to the bottom.

However, what right does a UK Secretary of State have to impose upon Wales such matters as trade union facility time, training arrangements, arrangements to deduct trade union subscriptions by payroll, the political levy and other industrial relations issues to do with what the Welsh Government, in exercising their statutory powers, deem the best way to deliver effective and efficient public services on the basis of social partnership, which they do? I shall be supporting an amendment to empower the Assembly and the Welsh Government to achieve that, and I ask the Minister to do the same. Otherwise there will be a direct clash with the Welsh Government and the Assembly which will surely undermine the Conservative Party’s new-found and welcome conversion to the cause of devolution. In short, this Bill is fundamentally flawed and could badly short-change Wales. I ask the Government urgently to think again on the matters that I and others have raised.

16:15

[Lord Elystan-Morgan (CB)]

My Lords, I begin by wholeheartedly endorsing what has been said by way of tribute to the noble Lord, Lord Bourne, and the very constructive role he has played for a couple of years now in Welsh devolution. Whatever the Bill’s defects might be—and I believe them to be myriad—he is not responsible for them, and I would not wish him to think that anything I say by way of criticism of the Bill is in any way directed at him.

I shall concentrate my remarks on what might be described as the main constitutional timbers of the Bill. As has already been said, this is the fourth time within the short span of less than 20 years that a major piece of legislation has been introduced in relation to Wales. What distinguishes this Bill and differentiates it from the other three attempts is that, whereas they added to the constitutional powers that Wales had as a land and nation, it turns in the opposite direction. Whereas they were progressive, this Bill is regressive.

I have no doubt that we would not be discussing these matters in the context of this Bill were it not for the decision by the Supreme Court in July 2014. That is the fons et origo of the whole matter. It is not an incandescence of enthusiasm on the part of the Government for Welsh devolution that brings these matters to the fore, but the realisation that a crisis was created by that epoch-making decision.

The House will broadly remember the facts of the case. The Cardiff Assembly was proposing a measure to standardise and define agricultural wages in Wales. There was an immediate objection by the Attorney-General, who seized on this matter like a hungry piranha and said that it was something Wales must not touch. Why was that? It was because it was a matter not of agriculture but of employment. If the Attorney-General’s logic had been correct, that would have been the end of the matter, but the Supreme Court respectfully disagreed with him in a 5-0 decision. Whereas the impression had been carried for a long time that if there had been a transfer of a limited nature within any one of the 20 fields of devolution to Wales, that was it, the Supreme Court said that where there has been a substantial transfer of functions and there are other allied matters that reasonably go with them, unless they have been specifically exempted, they are transferred. In other words, there is a silent transfer mechanism, and that is what caused the whole problem.

Given the situation that confronted Wales the day that judgment was published, it is right that we should consider how the Bill compares with that template. My submission is that the powers that Wales has under the Bill are vastly diminished compared with the decision reached by the Supreme Court. That is the reality. This matter has been touched upon already by one or two noble Lords, and I have no doubt that they are absolutely correct: the gap is very considerable. Yes, the decision to transfer to a reserved powers model has achieved something—certitude, of a certain nature—but it is a certitude for which a high price is paid: the diminution of the constitutional status of Wales. That is the effect of the main parts of the Bill.

The Government reacted fairly swiftly to that decision of 2014 and decided that they would move to a reserved powers model, which was introduced by the St David’s Day agreement of last year. A draft Bill was published, which was scrutinised by a number of distinguished bodies, and following that we have today the legislation proposed in the House of Commons in June of this year. I believe that the Bill is flawed, first in that it does not achieve the purpose that it genuinely should have sought to achieve. Secondly, it is a Bill that is unworthy of the people of Wales. We have a far lower level of devolution now than that which was spelled out by the Supreme Court in July 2014. The consequence is that we are moving backwards when we could have been moving forwards.

The worst part of the Bill is not what is mechanically set out in the reservations—of which there are far too many; more than 190, as we have heard—but the mentality that lies behind them. It is a mentality of monumental negativism. Look at the reservations: the control of axes and knives; the control of charitable funds and philanthropic institutions; and the control of the sale of alcohol, which Wales had devolved to it in the 19th century. I see the noble Lord, Lord Hunt, who well appreciates the history of this matter, nodding. There are many other instances where one could say that these are simple, basic, minor matters, taken against the bundle of responsibilities a nation has. The question I ask the House to consider is this: had such matters as these been raised 50 years ago by the Colonial Office in relation to a colony belonging to Britain, either in the Caribbean or in Africa, would they have dared bring about such reservations? The answer must surely be no. We are placed in a neocolonial situation by this Bill.

My appeal is not so much for a change in the mechanics, but for a change in mentality. I can remember being shocked as a schoolboy—which was many years ago, believe you me—when reading of a decision made by Mr Attlee’s Government in relation to Wales. Herbert Morrison, the then Home Secretary, announced it in these terms: “We have considered the future of Wales very carefully. We have taken advice, broadly, from people who are in a position to give that advice, and we have come to the conclusion that the very best that we can do in relation to Wales is to have a nominated council”. Do your Lordships think that Mr Herbert Morrison and his Government would have suggested a nominated council for a British colony 50 years ago? Most certainly not. To my mind, such neocolonialism shows that the dead hand of Westminster still lies upon Wales.

My appeal is not just for a new mechanism but for a new mentality altogether: a change in the attitude of the mandarins of Whitehall—the Sir Humphreys, Sir Williams and Sir Rogers—who say, “Nothing shall come from my table at all”, and likewise in the dog-in-the-manger attitude of Ministers towards their own powers. There should be a spirit of partnership and mutual respect between Cardiff and Westminster.

The Welsh people should think big in this matter. A distinguished English poet of the 19th century wrote:

“a man’s reach should exceed his grasp,

Or what’s a heaven for?”.

We as a nation have been grasping for small things, but we must think big about the role we can constructively play within the UK. I believe that dominion status is a principle sufficiently supple and mobile to allow Wales, under the 1931 Act of Westminster, to play the most major and constructive part imaginable in the life of the UK. That is the opportunity we now have. Many matters in the field of government are in a state of flux. Wales must react positively to that, as this chance may not come again.

16:26

[Baroness Bloomfield of Hinton Waldrist (Con) (Maiden Speech)]

My Lords, it is the greatest honour to speak for the first time as a Member of your Lordships’ House. I do so with humility and indeed nervousness, this being only the third working day since my introduction—which means, of course, that for the moment I have a 100% attendance record. I am also proud to speak now as part of the Welsh diaspora; it appears that there are very few of us on this side of the House.

I pay tribute to all the staff, officers and Members of the House on all sides who have made me so very welcome. I also thank my mentor, my noble friend Lady Seccombe, whose kindness and wisdom justifies her being held in such enormous affection by all in this place. I also thank my noble friend Lord Attlee, who will help to further my education in the ways of this House.

It was a particular privilege to be introduced by my noble friends Lord Strathclyde and Lord Chadlington. Both have given me enormous support and encouragement in my various roles within the party in London and the Wantage constituency. My noble friend Lord Chadlington and I also share a profound love and appreciation of our Welsh heritage, perhaps at its most evident when we attend the Millennium Stadium. Although not a native Welsh speaker, dw i’n dysgu cwmraeg—I am at least a Welsh learner—so it is a great honour to be making my maiden speech in the context of a subject so close to my heart.

The Statute of Rhuddlan in 1284 was intended to settle the Government of Wales once and for all following the execution of Dafydd ap Gruffydd, Prince of Gwynedd. Over 700 years later, and almost 20 years after devolution, this Bill continues the process of allowing Wales to determine its future priorities through an historic transfer of powers. We value our enormous good fortune to live in a democracy that allows for that evolution.

I was born and brought up in South Wales, and received my most formative years of education at Atlantic College in Llantwit Major. Its strong ethos of community service and international understanding has stayed with me all my adult life. Indeed, it was the resonance of the big society and social action that encouraged me into the political world in support of a party that believes in individual responsibility and the power of communities to help themselves—something to which I have also devoted much of my own time, setting up and supporting a number of charities providing opportunities for local residents as varied as young offenders, cancer sufferers and bored teenagers.

My mother served as a magistrate for more than 30 years in Barry and I, too, spent a number of years on the Bench both in rural Oxfordshire and at Horseferry Road in London. It is heartening to see that the Bill seeks to ensure the maintenance of the single legal jurisdiction of England and Wales, which has served both countries so well for centuries.

Prior to my time in CCHQ, I had worked in both shipping finance and then executive search for many years, so it was natural for me to return to the commercial world after the 2010 general election. I formed a team working towards the delivery of green energy from Iceland to the UK through a 1,500 kilometre seabed cable—a project that I hope will receive the full backing of the Icelandic Government after Iceland’s general election later this month.

This brought to my life full circle, for it was at Atlantic College that I wrote my dissertation on the generation of tidal power in the Severn estuary. I hope that the Swansea tidal lagoon scheme mentioned so recently in my noble friend Lady Finn’s maiden speech will be allowed the chance both to prove the energy-generating potential of our enormous tidal difference and to help in the regeneration of that important industrial heartland.

I hope also that the new powers devolved will make a real difference to people’s lives, allowing Wales to determine its particular needs and spending priorities. I am profoundly grateful for the social care in the community that my elderly parents and parents-in-law have received in Wales, enabling them to continue living at home. I have nothing but admiration both for those who provide such care and for those who have facilitated this choice.

Wales and its singular culture and heritage are to be cherished, and I hope that the provisions of the Bill will empower the Assembly to allow the unique and defining character and capabilities of Wales to flourish.

16:31

[Lord Wigley (PC)]

My Lords, the pleasure falls to me to congratulate the noble Baroness, Lady Bloomfield of Hinton Waldrist, on her eloquent and delightful maiden speech. The fact that she has chosen the Wales Bill for her first speech to the House intrigued me, until I did some homework and discovered that not only has she recently been on a course in Wales to learn Welsh, to which she referred, but she has also obtained a distinction on her first grade on the harp. I understand that this was part of a fundraising endeavour in support of the London Music Masters, which promotes diversity and excellence in music to inspire positive social change, so well done.

I also noted the noble Baroness’s comments about the diaspora. It has always been an ambition of mine to harness the Welsh diaspora much more effectively, and this is an excellent example of the benefits that can come from such an approach. I have no doubt that her education at Atlantic College enabled her to appreciate the place of Wales in an international context—that college most certainly does that. We wish her well for her fundraising—to the extent that it focuses on worthy cultural causes rather than political ones—we welcome her active interest in politics and we wish her well in her career in this Chamber and look forward to her future contributions to our debates.

This is the fourth piece of primary legislation on Wales which various Governments have introduced since 1998. Such a continuous sequence of amendment reflects two things: yes, a view that devolution is a process and therefore will develop over time; but also a widely held feeling that the original legislation was inadequate and needed amendment to make it work in a transparent, effective and democratically answerable fashion.

Along with several other Members in this Chamber, I have had experience as an elected Member of the Assembly. We are fortunate to have here today a former Presiding Officer, my colleague and noble friend Lord Elis-Thomas, and the newly elected Assembly Member, the noble Baroness, Lady Morgan of Ely, both of whom are up to speed with current thinking across party politics in the Assembly as to how its powers should be augmented or modified to make it a more effective body able to hold the Government of Wales to account, while enabling that Government, whatever their complexion, to work effectively for the benefit of Wales.

We have here two former Ministers in the Welsh Government on the Liberal Democrat Benches: the noble Lord, Lord German, and the noble Baroness, Lady Randerson. We have former Secretaries of State for Wales—the noble and learned Lord, Lord Morris of Aberavon, and the noble Lords, Lord Hunt, Lord Hain and Lord Murphy—who over many years have had a deep involvement in several Wales Bills, as have many other noble Lords.

I should also say how glad I am to see the noble Lord, Lord Crickhowell, participating in this debate. We have not always seen eye to eye on matters relating to devolution, but I know that in accepting our National Assembly as an essential part of Welsh governance, he will want to see it made more effective, transparent and answerable. We noted his wish to see the two Governments at each end of the M4 working together more constructively and his trenchant comments on the Barnett formula.

We have here the noble Lord, Lord Morgan, Wales’s most eminent historian on the period from 1868 onwards when questions of greater Welsh autonomy were emerging and, of course, my noble friend Lord Elystan-Morgan, a long-standing advocate of greater Welsh autonomy and of dominion status. We are also fortunate that the Minister taking this Bill forward, the noble Lord, Lord Bourne of Aberystwyth, was a very effective leader of the Conservatives in the two Assembly terms in which he served and was a key member of the Silk commission, which wrote the second report which forms the background to this Bill.

In other words, we have significant experience in this Chamber, whatever its democratic shortcomings, and it would be short-sighted of the Government not to take on board the issues that will be flagged up today, and at Committee and Report stages, which may not have had adequate coverage in another place. Colleagues have already referred to some of these and I shall touch on one or two others.

In doing so, I do not in any way resile from Plaid Cymru’s ambition for Wales to be a member state of the European Union in its own right. We accept that change comes but gradually and sometimes painfully slowly. Questions relating to the interface between Wales and the EU today appear to be in a somewhat different light. The constitutional future of these islands will partly depend on how Northern Ireland and Scotland are allowed to relate to the EU. To that extent, some aspects of this Bill are already dated, and the Bill’s existence reminds us that the United Kingdom Government still pursue separate constitutional proposals for Wales, Scotland and Northern Ireland, and for England, and give little thought to securing a balanced UK-wide settlement that might stand the test of time.

First, I remind the House that this Bill emanates from the Silk commission, which was set up by a Conservative-led Government in 2011. That commission included members of all four parties which then had seats in the Assembly. My friends in the SNP in Scotland have often been criticised at Westminster for not being willing to participate in similar commissions in Scotland—the Calman commission, for example. Plaid Cymru took a full role in the Silk commission’s work, with Dr Eurfyl ap Gwilym playing an outstanding part, as I am sure the noble Lord, Lord Bourne, would immediately acknowledge. Sir Paul Silk worked hard to secure a unanimous report, supported by all four party representatives. That took a good deal of work and compromise all round.

I must say that I think we had every right to expect the Government, unless there were fundamental reasons to the contrary, to accept the report in its entirety and not to cherry pick those items that fitted in with the Conservative agenda and discard others that were deemed to be inconvenient. I have party colleagues in Plaid Cymru who will be reluctant to participate and compromise in this way, given that the Silk recommendations have been diluted and re-engineered to meet prejudices in Westminster and the convenience of Whitehall departments, rather than the agreed needs of Wales.

So as not to be unnecessarily divisive, let me first identify some matters covered by the Bill that I welcome. These include the permanence of the National Assembly, the acceptance of the principle of a reserved powers model, giving the Assembly power over elections to the Assembly, including the electoral system and franchise, and control of fracking in Wales. I certainly welcome all of those.

However, I must also flag up some unsatisfactory aspects of the Bill, which I shall want to pursue at a later stage. I expect that my noble friend Lord Elis-Thomas will refer to the key issue of how to implement the central plank of Silk, namely the need for the powers of the Assembly to be based on the principle of reserved powers rather than the conferred powers model enshrined in the 1998 and 2006 Acts. The version which the Government have brought forward is regarded in Cardiff Bay as inadequate. In fact, it still contains as many as 200 reserved matters. Indeed, in some ways, it makes the position worse in that it actually takes back powers from the Assembly and the Welsh Government.

Furthermore, while the Secretary for Wales, Alun Cairns MP, has been apparently willing to explain his proposals, he has been reluctant in this respect to negotiate an outcome which might meet the needs of both Wales and Westminster. That smacks of government by diktat.

The Report on the UK Government’s Wales Bill, published last Thursday by the Assembly’s Constitutional and Legislative Affairs Committee, of which I have a copy here, states in paragraph 11 that the Bill,

“is a complex and inaccessible piece of constitutional law that will not deliver the lasting, durable settlement that people in Wales had expected”.

Paragraph 14 adds that,

“in our view, significant improvements needed to be made to the Bill … to reflect authoritative criticism … Regrettably, necessary improvements were largely not accepted by the UK Government”.

It is the unanimous view of the committee that the arguments put forward by the UK Government in opposing a more ambitious Bill, “are not convincing”. Paragraph 22 of the report says:

“The Bill we are left with provides a restrictive settlement that over-complicates rather than simplifies and fails to fully empower the National Assembly as a modern legislature”.

The report describes the Bill as,

“the first piece of devolution legislation that takes backwards steps and that is a matter of considerable concern”.

These views were endorsed by all four parties represented on that committee, including the Conservative former Deputy Presiding Officer of the Assembly, David Melding AM, and if the UK Government now state that they will ride roughshod over their representations, it shows how misleading are the assurances given by the new Prime Minister that the wishes of Wales will be taken into account by her Government. Incidentally, I am somewhat surprised that the report is not available in the Vote Office for noble Lords to access.

If I may give a specific example, it might help noble Lords to appreciate the shortcomings of the Bill. I take the issue of compulsory purchase. Under the 2006 Act, it has not been specifically devolved, but neither is it retained. Therefore, legally, the National Assembly could legislate in this matter, provided that it was “incidental”, and not “central” to that piece of legislation. It is an example of what has been referred to as a “silent subject”. In the Bill, compulsory purchase is deemed as a retained matter, so the Welsh Government would in future be unable to legislate as it could under the 2006 Act. This is a clear example of how this Bill is withdrawing powers from the National Assembly, despite claims by Ministers to the contrary.

I refer to some other matters which are not included in this Bill, although they were part of the Silk recommendations, concerning which I hope to table amendments in Committee. These include: the devolution of policing, supported by all four newly elected police commissioners in Wales; provision for the emergence of a distinct Welsh legal jurisdiction, the absence of which has caused much of the complexity for which this Bill has been rightly criticised; powers relating to the youth justice system; and powers concerning the Wales and Borders rail franchise.

I shall also seek to propose amendments that deal with greater Assembly powers relating to energy, to remove veto powers enjoyed by the Secretary of State and to clarify the Welsh Government’s authority in dealing with trade matters relating to the single market of the European Union, in the unfortunate circumstances that the UK Government fail to negotiate unfettered rights for manufactured goods and agricultural produce, free from tariff and technical barriers. I shall also raise questions relating to the repatriation from Brussels to Westminster of matters that are already devolved, so that they can be transferred immediately to the National Assembly if they impinge on devolved functions.

I also flag up my intention to bring forward an amendment in Committee to give the National Assembly full powers to decide on any new proposals for extracting water from Wales. Specifically, this must include the power of veto over any intention of drowning valleys to create new reservoirs, which must be subject to authorisation by the National Assembly, which should have the powers to impose whatever conditions it deems fit on such projects. Sixty years on from when Liverpool Corporation resolved to drown the Tryweryn Valley, against the united opposition of all Welsh MPs bar one, this issue still causes rancour and bitterness. If there was one single step that the Government could take that would recognise Welsh sentiment on this issue, it would be to empower the Assembly to decide on such matters. I have no doubt that every party in Wales would welcome such a step with delight. Associated policy issues, such as land use, flooding, agriculture, the development of natural resources, environmental policy, industrial development, tourism and recreation are already overwhelmingly devolved to the Assembly. I ask the Minister if he will, even at this late stage, take up with his fellow Ministers the possibility of righting a long-standing wrong, and bring forward at least an enabling clause at a later stage that could facilitate such a move.

At a time of great constitutional uncertainty, when the UK Government put so much emphasis on the validity of identity and “taking back control”, and on enabling communities to do much more to help themselves, this Wales Bill should be a beacon that demonstrates how such thinking now applies to Wales. It should project how the principle of bringing power closer to the people is not just a tug of war between London and Brussels; it is equally valid in enabling Wales to decide for itself those matters which—because of cultural diversity, differences in social aspiration and community values, or of geographic or administrative convenience—can best be decided in Wales.

We are united that we need new legislation that enables Wales to do more to help itself in a transparent and effective manner and that overcomes the shortcomings of the tangled mishmash of existing law. We need legislation which has the confidence of Wales’s elected representatives and which the Government of Wales herald as a positive step to overcome current deficiencies in our constitutional settlement. As a number of noble Lords have already indicated, I fear that this Bill falls short of those ambitions. Depending on how the Government respond to proposals from across this Chamber to improve its provisions at later stages, a question must remain as to whether we are better with, or without, the Wales Bill as currently drafted. I support its Second Reading, so that it can be amended at a later stage to enable it to achieve the purpose for which it was meant.