Scotland Bill

Ian Murray Excerpts

Wednesday 23rd March 2016 Commons Chamber

The Government made substantial amendments to the Bill on Report in this House. The Lords amendments are largely technical, but nevertheless include important provisions related to the fiscal framework and responsible parking. I am pleased that they were accepted in the other place. I urge the House to accept the Lords amendments.

[Ian Murray (Edinburgh South) (Lab)]

The Secretary of State’s description of the road traffic changes had me mesmerised. I could have listened to him all evening. We thank him for that.

It is a great pleasure to speak on behalf of the official Opposition. I am not going to pretend that the passage of the Bill has been entirely enjoyable, smooth or stress-free, but we are where we are and it has definitely been worth getting to this place. Every Member of this House and the other place should be incredibly proud of what has been achieved in such a short time. Some will say the Bill does not go far enough, and some will be disappointed that it does not contain what they wanted, but I think today marks a historic day in the devolution journey of our Scottish Parliament.

When this Bill is passed—there is no longer any doubt that it will be passed today—Scotland will have one of the most powerful devolved Parliaments in the world. That is what the Labour party has always wanted from that process. It was the former Prime Minister, the former Member for Kirkcaldy and Cowdenbeath, who devised the vow that promised more powers. Let us pay tribute both to him and to the Daily Record for publishing it at the time. [Interruption.] I knew I would get a reaction to that. If only I had said The National, the response from the SNP Benches might have been different.

That paved the way for the Smith commission, skilfully chaired by Lord Smith of Kelvin, who managed to negotiate cross-party agreement on the form that those powers should take. That in turn laid the foundations for the Bill before us today. It has now passed through this place and the other place. A revised fiscal framework has been agreed, crucially with the Barnett formula at its heart. As promised, the vow has been delivered, with Barnett protected. That was always a Labour party priority, as we recognise the integral role played by the Barnett formula in maintaining public spending in Scotland. That said, and as the Institute for Fiscal Studies astutely observed, during the fiscal framework negotiations it was, ironically, the SNP Government who insisted upon Barnett as sacrosanct. With the zeal of the convert, they argued vociferously for an approach

“which ensures the ongoing pooling and”

sharing

“of some proportion of ‘devolved’ revenues across the UK.”

Of course, as long-standing advocates of the Barnett formula and the principle of pooling and sharing resources that it enshrines, we gave the Scottish Government our full backing in those negotiations. I wonder whether that now means that the Scottish National party has renounced its No. 1 policy priority of full fiscal autonomy—perhaps we will hear this evening.

However, at least for the time being we have an agreement. The irony is that this Bill will wing its way to Her Majesty to receive Royal Assent, hopefully later tonight, on the eve of what would have been separation day in Scotland. It creates one of the most powerful devolved Parliaments in the world, as opposed to the White Paper prospectus promised by the SNP in 2014.

Some of the Lords amendments speak directly to that agreement, delivering, for example, the strengthened borrowing powers and the enhanced fiscal oversight of Scotland’s public finances that this fiscal framework provides for. Now that the last impediment to the Bill has been removed, we must focus on the powers that the Scottish Parliament is receiving. As the Secretary of State has said, the legislative consent motion has been passed by the Scottish Parliament.

Given that today is the last day of the current Scottish Parliament, it would be remiss of me not to pay tribute to all the MSPs, from all parties, who have served since 2011. With your indulgence, Mr Deputy Speaker, I will say a word or two about those MSPs, particularly Labour MSPs, who are retiring from the Scottish Parliament, having done so much in the process of getting this Bill here today. They include Hugh Henry, Duncan McNeil and Richard Simpson, who have served since 1999. There is my old university friend Richard Baker, who was first elected in 2003, and Margaret McDougall, Graeme Pearson and Drew Smith, who were elected in 2011. They all retire with our best wishes, especially Malcolm Chisholm, who was also a long-standing Member of this House. He retires leaving a distinguished record of public service to his constituents. We wish him well. It would also be remiss of me not to mention the right hon. Member for Gordon (Alex Salmond), who is not in his place. The Scottish Parliament’s loss is this place’s gain. Are we not lucky indeed?

With the passing of this Bill and the dissolution of the Scottish Parliament, we can today lay the old arguments of the referendum to rest, alongside any doubt that the vow has not been delivered. The conversation must now move on to how these powers are used—or not used in some cases. It is worth briefly reminding ourselves what those powers are, because they are considerable, and their Lordships looked at them in great detail, for which we thank them. The Scottish Parliament has power over rates and bands of tax on all non-savings and non-dividend income. That means it can put taxes up or bring them down; it can increase or reduce the thresholds at which the different rates are paid; or it can choose to do nothing and keep things pretty much as they are, short of affording a tax break to higher earners—champions of the status quo perhaps—even if, in so doing, some people are abandoning a manifesto pledge to reintroduce the 50p rate for those earning over £150,000. That is what some have chosen to do, but that is not what we would do

I wonder how commentators have looked on that process. Owen Jones, who is often quoted by the SNP Members now beside me, called it

“a huge blow to their credentials”.

What does the Scottish Trades Union Congress think of the Scottish Government’s grand plans for devolved taxation in Scotland? It calls them

“a disappointingly timid approach to tax policy…Breaking the consensus on increasing the additional rate is difficult to fathom.”

It said it was an approach that is

“difficult to reconcile with the Scottish Government’s”

so-called

“social and economic objectives.”

For the past five years, many people had the mantra “more power for Scotland.” Today, when the Bill is passed, we will have a powerful Scottish Parliament—power not as a point of principle, but power to be used for positive, progressive change. I can tell the House, in no uncertain terms, that the Scottish Labour party will not settle for power for power’s sake. We will not settle for the political choice of austerity. This Bill goes straight to the heart of how we would do that. We will oppose austerity in the UK and we will oppose it in Scotland, and when we get into government we will reverse it. We will build a better and fairer Scotland for all, and taxation will not be our sole tool for doing so.

Lords amendment 22 strengthens the borrowing powers available to the Scottish Government, as agreed in the fiscal framework, allowing them to invest more in capital infrastructure or to smooth out fluctuations in devolved taxes.

Scotland’s Fiscal Framework

Ian Murray Excerpts

Wednesday 24th February 2016 Commons Chamber

[Ian Murray (Edinburgh South) (Lab)]

I thank the Secretary of State for advance notice of his statement, and indeed for coming to the House yesterday to indicate he would be making it today. I begin by welcoming unequivocally the news that an agreement has been reached on the fiscal framework, and I would also like to echo the thanks to both Governments, the Deputy First Minister, the Chief Secretary to the Treasury, who is in his place, and of course the Secretary of State himself for working so hard to secure this historic deal. Our heartfelt thanks also go out to the officials of both Governments, who we all know are the people who do the real work in these negotiations.

Yesterday’s agreement marks the removal of the final obstacle to the transfer of significant and substantial powers to Scotland, and, as Lord Smith himself has said, the agreement

“sees the recommendations of the Smith commission delivered in full.”

Importantly, the vow stipulated clearly that the Barnett formula should remain the key mechanism for calculating Scotland’s budget. That has now been agreed and Barnett has been secured.

I note the Secretary of State’s commitment to publishing details of the agreement by the end of this week, and I welcome that commitment, but can he indicate whether this House will have time to scrutinise the agreement in detail? I have been saying for some time that greater transparency is required in the way these deals are negotiated. This process has highlighted the fact that future intergovernmental relationships must be improved to make these powers work for Scotland. Lord Smith’s recommendations that both Governments need

“to work together to create a more productive, robust, visible and transparent relationship”

and that the Joint Ministerial Committee

“must be reformed as a matter of urgency”

echo in this process. Can the Secretary of State confirm that this will be done?

We all know that the major stumbling block was the indexation method used for the block grant adjustment. Under the compromise reached, there will be a five-year transitional period, which will cover the full term of the next Scottish Parliament. Towards the end of that period, an independent review and recommendation will be published that will form the basis of a more permanent solution. When he gave evidence to the Scottish Parliament’s devolution Committee last night, the Secretary of State suggested that the period between the review being published and the transitional period ending at the end of March 2022 could be as little as 12 weeks. If no agreement is reached, what happens then?

On the transitional period itself, it is my understanding that the Scottish Fiscal Commission will carry out the necessary forecasts of Scottish GDP and tax revenues. Can the Secretary of State confirm that, under the terms of the fiscal framework negotiations, those forecasts will be fully independent of the Scottish Government? Last week, the Scottish Finance Committee voted against allowing for that independence.

There also seems to be some confusion over the block grant adjustment during the transitional period to 2022. The First Minister said it would be done according to the Treasury’s favoured method but with the Scottish Government’s favoured outcome. Can the Secretary of State confirm what method will be used? Will it be the catchily named tax capacity adjusted levels deduction, which I understand was the Chief Secretary to the Treasury’s latest offer?

Further clarity is also needed on the timeframe for the devolution of powers. The Secretary of State has said that the new income tax powers will be available by April 2017. However, the Deputy First Minister has said he does not agree that that timeframe is realistic. Is the Secretary of State able to confirm that the new tax powers will be transferred by April 2017?

Today the Scottish Government are passing the Scottish budget. Twelve months from now, at the time of the next Scottish budget, we want them to have full control of income tax and air passenger duty and the deployment of 50% of Scotland’s VAT revenues. We also want them to have the considerable powers over welfare, which will allow us to design a new social security system for Scotland.

I welcome the review and the fact that it will be fully independent. I have stated several times that impartial oversight and, if necessary, arbitration should be an established part of intergovernmental relations. Will the Secretary of State tell us how the review body will be chosen, and can he confirm that it will be done in a spirit of consensus with the full agreement of both Governments? Will he also tell us to what extent the recommendations of the review will influence the decision taken on the long-term solution for block grant adjustment?

I close by welcoming once again the agreement that has been reached. Today marks an historic date in Scotland’s devolution journey: the creation of one of the most powerful devolved Parliaments in the world. The promises made to Scotland in 2014 have been met—the Smith agreement implemented, Barnett protected, powers transferred, the vow delivered. Scottish politics will never be the same again thanks to these new powers. We have entered a new and exciting era of devolution. What an opportunity to transform Scotland for everyone—an opportunity that my party will grasp with both hands.

[David Mundell]

I agree with most of what the hon. Gentleman said about the opportunity this presents to change Scottish politics. I think the people of Scotland want us to move on from discussing process to discussing policies and the difference that we can make for them with these extensive new powers. It is my full expectation that the agreement and associated details should be available tomorrow, and I very much hope that that will afford the maximum amount of scrutiny. It will of course be open to Committees of this House to scrutinise the arrangements as they see fit.

For understandable reasons, the hon. Gentleman makes reference to intergovernmental relations, but it is important to look at what Lord Smith said about how this agreement was arrived at. He said:

“It is difficult to imagine a bigger test of inter-governmental relationships and while it was obviously a very tough negotiation, what matters is that an agreement was reached.

He continued:

“This provides an excellent basis for constructive engagement between the governments long into the future.”

I accept that fully. I believe that when the transition period is over and the independent reports have been published, it will be possible for the Governments to reach agreement.

The hon. Gentleman has asked many times why it has taken so long, but many important agreements are reached at the eleventh hour, just by the very nature of doing a deal. I am sure that we will be able, on the basis we have set out, to ensure that that is the case at the end of the transitional period. The independent review, to which he referred, will indeed be a matter for agreement between the two Governments, but as he is well aware, many people in Scotland hold themselves out as being independent but are perhaps not as independent as they superficially seem. It is therefore important that there is agreement between the two Governments as to how that independent review should go forward.

On the Fiscal Commission, the agreement with the Scottish Government is that its forecasts will be fully independent. Finally, this Government will place no impediment on the transfer of powers. Obviously we cannot impose the income tax powers on the Scottish Government, and we would not seek to do so, but I would have thought and hoped that they would want to take them on as soon as possible, and that is the end to which we will be working.

Public Finances: Scotland

Ian Murray Excerpts

Wednesday 3rd February 2016 Commons Chamber

[Ian Murray (Edinburgh South) (Lab)]

I beg to move,

That this House notes the ongoing negotiations between the Scottish and UK Governments in the Joint Exchequer Committee on a revised fiscal framework to accompany the Scotland Bill; regrets that, despite both Governments repeatedly stating that the negotiation of a revised fiscal framework would be concluded by autumn last year, no agreement has been reached; further regrets the complete lack of transparency with which negotiations have been conducted; notes that, until agreement is reached, the measures in the Scotland Bill will not be implemented and the substantial new powers it contains will not be deployed for the benefit of the Scottish people; believes that both the UK and Scottish Governments have a duty to ensure that the negotiation of a revised fiscal framework which is fair to Scotland is completed in time for the Scotland Bill to be approved by the Scottish Parliament prior to its dissolution, so that it can use its current and future powers for the benefit of the people of Scotland; and calls on the UK Government to publish all minutes and papers from the Joint Exchequer Committee negotiations, and to assure the House that every effort is being made to ensure that agreement on a revised fiscal framework is reached, and the Scotland Bill is passed, prior to the Scottish Parliament elections.

I am sorry that you do not want an oratorical flourish, Madam Deputy Speaker, because that is what I was preparing to give—but never mind; we will continue with the debate. I appreciate that this debate has been curtailed because of the previous debate, which was on an incredibly important issue, and because of the Prime Minister’s statement. We have to accept how the House works in such circumstances.

It is a pleasure to open this debate for the Opposition. At its core, this debate is about the transfer of new powers to Scotland under the Scotland Bill, which completed its passage through the House in November and is currently in the other place. It is worth briefly reflecting on the Bill, to put this debate about Scotland’s public finances and the fiscal framework into context. The Bill had its genesis in the vow and the Smith commission, the recommendations of which were agreed by all five major Scottish political parties. When passed, the Bill will transform the Scottish Parliament into one of the most powerful devolved Parliaments in the world.

Scotland will have control over all income tax, apart from non-savings and non-dividends income, which generated almost £11 billion in revenues in 2013-14. The Scottish Parliament will have the power to vary the rates and bands of income tax, to increase or decrease those revenues. This greatly enhances the powers devolved under the Scotland Act 2012, under which the Scottish Parliament controls just 10p in the pound. On that note, the Scottish Labour leader, Kezia Dugdale, announced yesterday that, faced with a choice of cutting into Scotland’s future or using the powers of the Scottish Parliament, we would use the latter to set the Scottish rate of income tax at 11p, rather than the 10p in the SNP Budget, to invest in that very future for Scotland and to protect the low-paid. We made that point in the debate in the Scottish Parliament today.

These new revenue-raising powers are accompanied by new spending powers, such as control over £2.5 billion of welfare spending. The Scottish Parliament will be able to top up existing UK benefits and, thanks to concerted pressure from Labour and our amendments, will have total autonomy to create new benefits in devolved areas. When these new powers are enacted, the Scottish Parliament will be able to make different choices to create a better Scotland.

[John Redwood (Wokingham) (Con)]

Who in the hon. Gentleman’s party speaks for England to make sure that the settlement is fair to England as well as to Scotland?

[Ian Murray]

The settlement has to be fair to the rest of the UK as well, including England, but I will come to that later.

[Alex Cunningham (Stockton North) (Lab)]

We hear of cheers in the Scottish Parliament this afternoon when the Scottish Finance Minister tried to justify public expenditure cuts by the Tories. Is that not the final proof that the socialist credentials that the SNP claims have no foundation whatsoever?

[Ian Murray]

I am grateful to my hon. Friend for that intervention, because what we have seen this afternoon in Scotland is a Scottish Labour party determined to use the current powers of the Scottish Parliament to try to do something different from Conservative austerity. The result of that is a Scottish Finance Minister and a Scottish Government just managing that Conservative austerity. As I said earlier, when faced with the choice of managing the Tory austerity or creating a different future for Scotland, we have chosen to create that different future.

I was explaining the principles behind the Scotland Bill. However, before the Scotland Bill can be enacted they must be underpinned by a new fiscal framework for Scotland. That runs alongside the legislative process, which is slightly different from what happened with the Scotland Act in 2012.

It is crucial to state that the Smith commission stipulated that the Barnett formula would be retained as the mechanism for determining Scotland’s block grant. That is not in question in this debate. However, Scotland’s block grant will need to be adjusted to reflect both the new tax-raising powers and new expenditure responsibilities that are being devolved, and that is at the heart of today’s debate. Until that revised framework is agreed by the UK and Scottish Governments, the Scotland Bill cannot be enacted and the new powers and responsibilities it transfers cannot be implemented. We need a negotiated agreement in order to move on, otherwise the new powers will lie dormant and Scotland’s financial position in the future will remain very uncertain.

[David Mowat (Warrington South) (Con)]

The hon. Gentleman mentioned the Barnett formula and the vow, and of course he is right that the Barnett formula will be retained, but he will also be aware that it is not based on relative need and therefore is not fair to England, and in particular to Wales. Will he therefore, as a member of a party of the left, support reform of the Barnett formula to make it more progressive for the whole island?

[Ian Murray]

There is consensus across the entire Chamber that the Barnett formula should stay in place. It was in the vow signed by all the major party leaders who went into the general election. The Smith agreement has been signed by all five political parties, and that includes the maintenance of the Barnett formula. The hon. Gentleman, from the Conservative Back Benches, wants to renew and review the Barnett formula, which means only the Labour party in this Chamber will defend it. It would seem that the policy from the Conservative Back Benches is to do away with Barnett and that the Scottish National party wants full fiscal autonomy, which would also do away with the Barnett formula. We will defend the Barnett formula, because it is in the interests of our constituents to do so.

[David Mowat]

rose—

[Ian Murray]

I am happy to give way to the hon. Gentleman again, while bearing in mind that this debate is very much curtailed.

[David Mowat]

I do not want to do away with the Barnett formula. I would just like to see it revised so it is based on relative need, because that seems to me to be a very fair way forward.

[Ian Murray]

The Barnett formula is based on that need. It was designed in the 1970s to take into account not only the contribution that Scotland makes to the United Kingdom but its public service requirements and geographical nature. It commands broad political consensus and I do not think we should break that. That would be a very difficult message to send out.

The message from today is that it is the job of the Scottish and UK Government Ministers to get a deal. We heard today that the Chief Secretary to the Treasury, who I am delighted is in his place, will be in Edinburgh for talks all day on Monday. The people of Scotland will expect nothing less than a final deal that is signed, sealed and delivered. We support the Scottish Government in their efforts to reach an agreement that is fair, equitable and consistent with the Smith agreement. Again that is not in question, but reach an agreement they must.

[Helen Goodman (Bishop Auckland) (Lab)]

Surely before the Scottish referendum the Scottish people were promised these extra devolved powers and they will be extremely disappointed with all this shilly-shallying around and failure to come to an agreement after 18 months?

[Ian Murray]

That is the crux of our calling for this Opposition day debate. I will come on very soon to the issues around timescales and what should have been delivered by now, but nobody will forgive us in Scotland, or indeed across the rest of the United Kingdom, for breaking the promise of getting these powers through so that the Scottish Parliament can choose a different course, if it so wishes, from the rest of the UK.

As I was saying, reach an agreement they must. I believe there is broad consensus on this point across the Chamber. Indeed the SNP chair of the Scottish Affairs Committee, the hon. Member for Perth and North Perthshire (Pete Wishart)—I am delighted he is in his place—has also said that he wants

“assurances…that a deal will be reached in time.”

We do not agree on very much, but we certainly agree on that particular point. Few people would understand if both Governments were to walk off the job before it was done and instead start a blame game.

I want to highlight two key issues in the debate. The first is the secretive nature of the negotiations and the consistent refusal of both Governments to publish any meaningful papers or minutes from the Joint Exchequer Committee meetings.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

I thank my hon. Friend for giving way. I did not mean to interrupt his flow; he is making an important speech. The Communities and Local Government Committee has published an important report today, not about Scottish devolution but about English devolution, and it contains major criticisms of the lack of openness over deal negotiations. Does he share my concern that the Government seem to be operating in an underhand way in relation to these negotiations as well?

[Ian Murray]

I agree with my hon. Friend. This seems to be very much the way in which this Government operate. We have just had a debate about taxation, and we have also discussed the devolution settlements that the Communities and Local Government Committee’s report mentions. It is important that we have transparency, because the only way to carry the public with us on the fundamental issue of devolution to local communities is to ensure that the arrangements are transparent, robust and democratic.

That brings me to my second concern in this Opposition day debate, which is the need to agree the framework so that the Scotland Bill can be passed in time for the Scottish parliamentary elections in May. For months now, the negotiations in the Joint Exchequer Committee have dragged on behind closed doors, shielded from public scrutiny. According to Scottish Government sources, agreement is as far off as it has ever been, while the tone of the Secretary of State suggests that he is straining every sinew to get a deal. There was always a danger that, away from the spotlight, the two Governments would fiddle and fixate and that the momentum to reach a deal would be lost. And so it has proved. This relates to the concern raised earlier by my hon. Friend the Member for Bishop Auckland (Helen Goodman).

At first, agreement was going to be reached by last autumn. The Scottish Secretary consistently referred to an autumn deadline, as did the Chief Secretary to the Treasury and the Deputy First Minister in Scotland, but no agreement materialised. Then the deadline was moved to mid-February. In mid-December, the First Minister talked up the prospect of a Valentine’s day deal, but come January her deputy, Mr Swinney, struck a downbeat note emphasising the big gap between the two Governments. He also introduced an arbitrary deadline of 12 February for a deal on the fiscal framework. If negotiations were not concluded by then, he would not table a legislative consent motion prior to the Scottish Parliament’s dissolution before the elections in May. I have yet to find out why that is the case, because the Scottish Parliament does not dissolve until late March. If no agreement is reached, the Scotland Bill will effectively be kicked into the long grass. That would mean no new powers for the foreseeable future.

For all that, I remain confident that if the political will exists, a deal can be reached. To test that political will, however, we need to bring the negotiations out into the open and allow the public to see whether this is brinkmanship or a proper negotiation. From the very beginning, I have bemoaned the absence of transparency at the heart of these negotiations. It is simply unacceptable that the process of redrawing Scotland’s fiscal terrain is taking place behind closed doors in vapour-filled rooms.

[Andrew Gwynne (Denton and Reddish) (Lab)]

Does my hon. Friend agree that a key reason for the deal to be done before the Scottish parliamentary elections is to give the Scottish electorate some confidence in the promises being made by the political parties on spending and taxation? Does he also agree that there is great interest in this matter across the rest of the United Kingdom because of the asymmetric nature of devolution? We want to see how Scotland uses these powers.

[Ian Murray]

My hon. Friend is absolutely right. Without having the Scotland Bill on the statute book and available to be used from 1 April 2017, there will be obfuscation about what can go into party manifestos come May, and we will be having a constant debate about the constitution rather than about the transformation of Scotland. He is also right to suggest that this is not just about a fiscal framework for Scotland. It is important for these negotiations to run in parallel with the Scotland Bill, but they also have significant implications for the rest of the United Kingdom. The no detriment principle for Scotland works both ways; it is also a no detriment principle for the rest of the United Kingdom. That point is often lost in these discussions.

As I was saying, I have bemoaned from the very beginning the absence of transparency. It is simply unacceptable that the process of redrawing Scotland’s fiscal terrain is taking place behind closed doors. David Bell, the respected economist, has noted the secretive nature of these discussions. He said:

“These discussions are taking place behind closed doors with little information publically available about the options being considered and the effects of these options.”

Asked to offer his thoughts on these proceedings, Professor Muscatelli said:

“I will be honest, it is difficult for anybody on the outside to see what exactly the stumbling block is”

in these negotiations. Even the Chair of the Scottish Affairs Committee—this might be the second time we have agreed—said that the negotiations and the transparency at their heart are “not good enough”. I also warmly welcome the Scottish Affairs Committee’s in-depth inquiry on this issue, which it will publish soon.

I ask why both Governments refuse to publish papers and minutes, as requested. On 9 September, I wrote to the chairs of the Joint Exchequer Committee, John Swinney and the Chief Secretary to the Treasury, with the perfectly reasonable request to publish papers and minutes from the meetings, but they refused to do so. I also tabled written and oral questions to ask that we be kept updated on the progress of the negotiations and that substantial details of the discussions be placed in the public domain, but, once again, my request was rejected. Both Governments said that they would not provide a “running commentary” on the negotiations, while providing the very same running commentary through the media. Meanwhile people in Scotland are very much in the dark. That has allowed politicians on both sides to seek to exploit the secrecy, rather than getting on with finalising the deal.

[Stella Creasy (Walthamstow) (Lab/Co-op)]

Does that not also trouble my hon. Friend, because it goes back to the very principles of the Smith commission, pillar one of which explicitly said that one challenge faced in this new constitutional settlement was having much stronger, transparent parliamentary scrutiny of the work? It particularly identified the JEC. If we cannot get it right now, what hope do we have for the future?

[Ian Murray]

That is a timely intervention, because when everyone talks about making sure that the Smith agreement is delivered in spirit and in substance, they tend to forget the bits of the substance that it is inconvenient for them to remember, and that is one such bit. The JEC has not been transparent. One key plank of the Smith agreement was intergovernmental relations, and without that transparency we cannot see whether intergovernmental relations are actually working. One key thing about the whole devolution project, be it in Scotland, Wales, Northern Ireland or in the discussions about England, is to make sure that all the components of that devolved body of the United Kingdom can work together in partnership.

Let me compare these negotiations with the fiscal framework negotiations that sat alongside the Scotland Act 2012. I have here the minutes of the first meeting from that process, which took place on 27 September 2011, and they are a dusty tomb of information, giving details of who attended, points that were discussed, things that were agreed and things that were to come back to be agreed. By contrast, let me give a flavour of the communiqués from this year. The one relating to the 1 February meeting states:

“The Joint Exchequer Committee met in London today, chaired by John Swinney, Deputy First Minister and Cabinet Secretary for Finance, Constitution and Economy. HM Treasury was represented by…Chief Secretary to the Treasury.

This was the eighth meeting of the JEC since the publication of the Smith Commission report…The Ministers continued their discussion…

Both Ministers agreed to meet next week”.

The minutes on the 21 January meeting again introduce who was at the meeting, with their very long titles. They then state:

“This was the seventh meeting of the JEC since the publication of the Smith Commission report. The Ministers continued their discussion on the indexation methodologies for the Block Grant Adjustments and also discussed the initial transfer of funding for new welfare powers….

Both Ministers agreed to meet again shortly”.

They go on, running to less than a third of a page—a couple of paragraphs of minutes. I am not sure that having no details and no substance is acceptable.

It is not acceptable because the Scottish Government have threatened to veto the Bill if it is “not fair to Scotland.” The problem is that we do not know what, in their opinion, or in the UK Government’s opinion, is a fair deal for Scotland and what that looks like. We do not know in what way the current detail on offer from the UK Government is deficient on that test of fairness. It would appear that the main stumbling block is on the method used for the future indexation of the block grant. Of the methods being considered, the Scottish Government now favour the per capita index deduction. People can go to the Library to find out what that is—I will not explain it at this juncture. [Hon. Members: “Go on!”] I can go through the formula if Members want, and give a prize if they get the answer at the end. Less than a year ago, however, the Deputy First Minister told the Scottish Parliament’s Finance Committee that he favoured the indexed deduction, which takes into account population growth. There is clearly some confusion over which method is best for Scotland, which is why transparency of discussions is incredibly important.

[Kirsty Blackman (Aberdeen North) (SNP)]

I understand that the Labour party is feeling a bit sad, because, as it has not been successful enough to be in government in either country, it is not involved in these negotiations. Now that the shadow Secretary of State has the opportunity to have his say, can he please tell us what method of block grant adjustment Labour would favour?

[Ian Murray]

Well, we do not know—[Laughter.] Let me answer the question! We have not seen the negotiations, but, as the leader of the Scottish Labour party has said, we prefer the per capita index reduction model, because it is important that we have that particular debate. It is strange that the intervention gave the impression that we are being locked out. It is not the Labour party that has been locked out of these discussions, but the Scottish people, which is why we called this debate. We want to shed some light on these very secret discussions.

I noticed that the hon. Lady did not say whether she supports doing something in Scotland with the powers that her party currently has, or whether she is willing just to manage Conservative austerity.

[Alex Cunningham]

I thank my hon. Friend for giving way again. Does he agree that there are some amazing parallels between these negotiations and the Prime Minister’s EU negotiations, where we were kept totally in the dark all along and then we found out that there was nothing to see anyway?

[Ian Murray]

Absolutely. I suspect that that is part of the problem that we have now.

I am conscious of the time, so let me quickly wrap up by paying some attention to the SNP amendment that has been selected in the name of the right hon. Member for Moray (Angus Robertson). I cannot quite fathom why the party has tried to amend what is a very uncontentious motion. I thought that we could work together on this important issue given that we share the same goals for a fair deal for Scotland. Our motion merely reflects the views that have also been expressed by the Chair of the Scottish Affairs Committee. I have no problem at all with the SNP amendment as it is written, but it is a wrecking amendment, as it would completely replace everything that we are asking for in our amendment. I wish that the SNP had tabled the amendment as an addendum, and we could have gone forward together in consensus. The purpose of this debate is to get transparency and to ensure that a fair deal is done, and I would have thought that SNP Members would have agreed with that. I welcome the fact that they are now defenders of the Barnett formula, as a few months ago they were voting in this Chamber with the Conservatives to scrap the Barnett formula in favour of full fiscal autonomy. It does pose the question of whether they are really interested at all in getting these particular issues resolved.

Let me finish by talking a little about the democratic deficit, which was the second plank at the heart of these negotiations. We must close that deficit. The Scotland Bill is much too important for us not to do that.

I will conclude by posing a few questions, which I hope can be answered by the Secretary of the State in his opening remarks, or by his colleague, the Chief Secretary to the Treasury, at the conclusion of this debate. The Chief Secretary to the Treasury announced today that he will be in Scotland for more talks on Monday. What are the Secretary of State’s aspirations for that meeting, and is a deal expected at those talks? Does the Secretary of State recognise 12 February as a final deadline, and what will happen if a deal is not reached by that date? Will negotiations continue regardless of dissolution and the Scottish parliamentary elections? Will the Secretary of State publish the final offers from both parties for transparency purposes so that the public can determine whether or not these were good deals for Scotland? Has consideration been given to agreeing a deal for a trial period thus allowing for assessment and adjustment?

Our motion urges both Governments to work together and to stay at the table until a deal is agreed. It also calls on the UK Government to publish all minutes and papers from the Joint Exchequer Committee, and I commend it to the House.

[Madam Deputy Speaker (Natascha Engel)]

Order. I now have to announce the results of today’s two deferred Divisions. On the motion relating to social security regulations, the Ayes were 297 and the Noes were 73, so the Question was agreed. On the motion relating to the social security pensions Order, the Ayes were 301 and the Noes were 70, so the Question was agreed.

[The Division list is published at the end of today’s debates.]

--- Later in debate ---

[Stewart Hosie]

For the hon. Gentleman’s benefit, I will come on to the specific issue of raising tax in a just a moment.

Before I leave the context of the UK fiscal charter, let me say that we all recall the vote on 13 January 2015 on the implied £30 billion of cuts, when we made many of the same points we are making today. The great tragedy then and now is that the Labour party supported £30 billion of extra Tory pain and austerity.

[Ian Murray]

Will the hon. Gentleman give way?

[Stewart Hosie]

I will happily give way.

[Ian Murray]

Let us just dispel this constant nonsense from the Scottish National party. The hon. Gentleman’s own First Minister said, when she launched the Scottish business partnership at Tynecastle stadium in June, that the framework on which there was a vote on 13 January 2015 gave Governments enough flexibility to do as they wished. It was very similar to the fiscal framework or charter that he promoted back in November. He refuses to use such powers; he would rather demolish and demoralise Scottish public services.

[Stewart Hosie]

As the arguments are complicated, it is so much easier simply to quote in full from the 15 January issue of the new Labour leadership’s favourite newspaper, the Morning Star:

“Labour MP Diane Abbott accused her party’s leaders yesterday of doing working people a ‘great disservice’ by backing Tory plans for permanent austerity.”

The hon. Gentleman keeps getting it wrong.

The key thing is that Scotland’s budget has been cut and will continue to be cut by this Government, which makes the achievements of the Scottish Government all the more remarkable. That makes it all the more important not simply that we get any old fiscal agreement, but that we get it right. We must ensure that the Smith commission principle of “no detriment” is adhered to and that we do not embed unfairness in the system, so that we are not subject to possible additional cuts of about £350 million a year. We need to avoid that outcome so that we can continue to do good things and build on the progress we have seen in health spending, which is up to £12.3 billion this year and will be £13 billion next year, and in education.

Scotland Bill (Programme) (No.2)

Ian Murray Excerpts

Monday 9th November 2015 Commons Chamber

[Ian Murray (Edinburgh South) (Lab)]

I do not want to detain the House either, but I agree with the hon. Member for Perth and North Perthshire (Pete Wishart)—I hope that he does not turn to dust as a result—not on his content, but on the tone with which he has started this debate. It is worth putting on record that the Government, Opposition and SNP Whips—the usual channels—spent an inordinate amount of time on this, and I understand that there was broad agreement on how today’s proceedings would operate.

We would very much like some more time in the Chamber, but unfortunately that will not happen on Report and Third Reading. Given that the Government have accepted most of our amendments on the permanency of the Scottish Parliament, that the Scottish Parliament can now design its own social security system, and that the Government have moved towards the removal of the perceived vetoes—and, indeed, given the equalities section—we think the vow has been delivered. We agree with some of the Government amendments. The Government have come forward with amendments that agree with some of ours. I think we should get on with the debate this afternoon and start to discuss some of these issues. If the Scottish National party press this to a vote, we will see whether the House agrees.

Scotland Bill

Ian Murray Excerpts

Monday 9th November 2015 Commons Chamber

[Ian Murray (Edinburgh South) (Lab)]

The Secretary of State is cantering through the Government amendments. Can he clarify for the House whether, in the current context, they would require a legislative consent motion for the Trade Union Bill?

[David Mundell]

As the hon. Gentleman will know, the Trade Union Bill is still under discussion in this House, and it is the Bill as finalised by this House and the other place that will determine the nature of any legislative consent motion that is required, as is the normal practice.

The amendments I have tabled today fulfil my commitment to reflect on the debate in Committee. It is a bit rich to be criticised both for taking no amendments and, in the same breath, for tabling too many. We took the Committee process seriously and the contribution from the devolved powers committee in the Scottish Parliament very seriously, and that has determined our thinking in lodging these amendments. We will now hear the case for other, non-Government amendments, but the House will not be surprised to hear that the Government still consider that full fiscal autonomy is not in the interests of the people of Scotland. I believe that Scotland’s parties, rather than rerunning the referendum, need to work together to understand how the powers in the Bill will be used for the benefit of the people of Scotland. The UK Government are honouring their commitment in the Edinburgh agreement, accepting the result of the referendum and moving forward to give the Scottish Parliament significant new powers within our United Kingdom.

--- Later in debate ---

[Sir Edward Leigh]

I do not know if the new shadow Chancellor voted in our Lobby, but there seems to be an interesting concept nowadays in the Labour party: there is full freedom on the Labour Benches and, apparently, the Labour party leader can oppose Labour party policy on Trident and much else. As we have just heard, the shadow Chancellor opposes Labour party policy on full fiscal autonomy. This is an interesting situation. I have made my point. I do not believe this is a genuine proposal from the shadow Secretary of State.

[Ian Murray]

I respect the hon. Gentleman immensely. If he thinks back to the debate we had on 15 June, he will recall that no one in this Chamber from the SNP or his colleagues on the right wing of the Conservative party believed the figures that were put forward by the Institute for Fiscal Studies or the Treasury, or the Scottish Government’s own figures. New clause 1 is an attempt to bring some clarity to those figures so that full fiscal autonomy could benefit Scotland, rather than being an £8 billion black hole.

[Sir Edward Leigh]

I do not want to get into a debate about a black hole, the deficit and all the rest of it. I remember that I was intervened on by the hon. Member for East Lothian (George Kerevan) and I accepted that there should be transitional arrangements. I made the point that this was not a right-wing Tory trap for the SNP. This was not a device to get rid of Barnett because we were claiming that the Scottish people get £1,600 a year more. I said precisely that if there was full fiscal autonomy and we got rid of Barnett, we should retain the United Kingdom and there should be a grant formula based on need.

If, for instance, Scotland had a particular problem, as we have in Lincolnshire with the sparsity factor in relation to education provision, or with declining industries, we are a United Kingdom Parliament. We are a fraternal Parliament. I believe in the Union, I believe in our standing together. If there is a need for the United Kingdom—I called it the imperial Parliament, as it were—to help out our friends in Wales—[Interruption.] SNP Members do not like that word, but I used it advisedly. That was the term that was used during the debates on Irish home rule. It is a technical term. If our friends in Northern Ireland, Wales or Scotland need extra help from the United Kingdom Parliament, we should give that help, but it should be based on needs, not on an automatic formula based on Barnett, which is an outmoded concept that has outlived its usefulness. It is also, as I have said, very dangerous in the context of the debate on English votes for English laws.

I am sorry to take the Labour party to task, because I respect the shadow Secretary of State. Labour is making some progress, but it is still behind the curve and I do not believe it will ever get back in front of the curve in Scotland unless it is bold. I repeat the point I made back in June: whether we like it or not, we have the election system that we have. We, the Unionist parties, went to the Scottish people. We based our arguments on the Smith commission, and we lost 56 of the 59 seats in Scotland.

The hon. Member for Nottingham North (Mr Allen) can complain about that, but that is the parliamentary system we have. We have to accept that, whether we like it or not, the Smith commission was rejected by the Scottish people. If we want to save the Union—and I am as passionate about the Union as the hon. Gentleman —we cannot be behind the curve on this. We have to be big-hearted, we have to be bold, and we have to move with full fiscal autonomy and move with it now.

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[Angus Robertson]

The hon. Gentleman has put his point of view on the record. I encourage him to get in touch directly with the Cabinet Secretary for Rural Affairs, Food and Environment in Scotland, Richard Lochhead. We are proud of the Scottish Government’s rural affairs agenda. Incidentally, I commend the hon. Gentleman’s party for turning up in greater strength to this debate than the Liberal Democrats.

To hold the 2014 referendum, the Scottish and UK Governments were required to agree a section 30 order, which amended schedule 5 to the Scotland Act 1998, to grant the Scottish Government the legislative competence to hold a referendum, providing that a number of conditions were met—namely, that it was held before the end of 2014 and that the ballot paper included one question.

New clause 36 would permanently transfer to the Scottish Parliament the power to legislate for a referendum on Scottish independence. It is right that the Scottish Parliament should decide on that, and not this place. As the First Minister has made clear, the SNP manifesto for next year’s Scottish election will set out our position on a second independence referendum and consider in what circumstances such a referendum might be appropriate at some point in the future. However, the final decision on whether there is another referendum and on whether Scotland ever becomes independent will always be for the people of Scotland.

In the meantime, I observe that support for Scottish independence has continued to grow. If people back home are watching this debate, I have no doubt that it will rise even further. A Panelbase poll for The Sunday Times found that 47% of people in Scotland currently support independence and that more than two thirds believe that the country will be independent by 2045.

Support for independence has risen as the UK Government have failed to meet their promises on more powers; continued with austerity; introduced further welfare cuts; and promoted English votes for English laws. Since the referendum, the UK Government’s attitude towards Scotland has angered a great many people. Those who are watching proceedings today have good reason to be angered yet more. On EVEL, the Scotland Bill and austerity, the UK Government have shown scant regard for the voice of the people of Scotland.

We will not lose sight of the financial arrangements that relate to the Bill. We raised them in Scottish questions last week. We understand that a negotiating process is under way between the UK Government and the Scottish Government. It is critical that that financial framework is negotiated in good faith between both Governments and without detriment to the people of Scotland.

[Ian Murray]

I am grateful that the right hon. Gentleman has got on to the fiscal framework. At Scottish questions last week, I asked the Secretary of State whether we could have a little more transparency about the discussions to prevent anyone or any party in this Chamber from misinterpreting what the fiscal framework is trying to achieve. The Scottish people can then make their own judgment about whether it is detrimental to Scotland or otherwise.

[Angus Robertson]

Without wanting to concern the hon. Gentleman, I agree with him. Transparency is a good thing. Our colleagues in the Scottish Parliament are significantly happier than we are here with the open approach that the Scottish Government are taking on this matter. Obviously the negotiations are between the two Governments, but the Secretary of State could easily come to this House and provide more information to the hon. Gentleman’s satisfaction and mine.

The Smith commission identified that Scotland’s budget

“should be no larger or smaller simply as a result of the initial transfer”

of powers. It recommended that the devolution of further tax and spending powers to the Scottish Parliament

“should be accompanied by an updated fiscal framework for Scotland”

and that

“the Scottish and UK Governments should jointly work via the Joint Exchequer Committee to agree a revised fiscal and funding framework for Scotland”.

The UK and Scottish Governments are negotiating the fiscal framework on an ongoing basis. It should allow the Scottish Government to pursue their own distinct policies that meet the needs and wishes of the people of Scotland. For fiscal devolution to work, it is essential that the Scottish Government have the flexibility to pursue distinct fiscal policies, consistent with the overall UK fiscal framework.

The block grant adjustment should be robust and transparent, deliver a fair outcome for Scotland and be agreed by both Governments. The effect of the adjustment should be to ensure that the Scottish Government’s budget is in broad terms no better or worse off in the long term compared with what the devolved taxes would have raised had they not been devolved. The Scottish Government have said that they will not sign up to any adjustment that is not fair to Scotland. That is in line with the “no detriment” principle set out in Smith.

Before us today, we have 200 amendments and new clauses. They are massively important to people in Scotland. Sadly, they are clearly not important to the Labour and Conservative parties, which are here in such small numbers. I will bring my contribution to a close to ensure that more Members of Parliament for Scotland have the opportunity to take part.

The people of Scotland are watching these proceedings. We are told that this is the mother of all Parliaments. This is supposed to be the most important legislation about the future of our country, yet it has been shoehorned into less than one day of proceedings. Incidentally, for the information of the shadow Secretary of State, that happened against the wishes of the Scottish National party, which pressed for another day of proceedings so that we could look into the proposals in detail. People should look and learn, because if this is the way to legislate, we do not need it. The Scottish Parliament is a 21st-century Parliament. If ever a case was put for the Scottish Parliament to be able to exercise power over all issues that matter to the people of Scotland, this is it.

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[Tommy Sheppard]

The hon. Gentleman must speak for the people who elected him, and I will speak for those who elected me. I am discussing the Scotland Bill, as amended—that is what I have been speaking about, and what I intend to speak on. The Bill falls far short of the expectations not just of the SNP, but of the people of Scotland. Civic society, trade unions, Churches and voluntary organisations throughout Scotland are disappointed at the poverty of ambition shown by the Secretary of State and the Government in the Bill.

Let me return to the Bill, because that is all we currently have—I do not normally read when making a speech, but I will read this quote so that I do not get it wrong. The Secretary of State said, on 8 June:

“I am absolutely clear that the Scotland Bill does fulfil in full the recommendations of the Smith commission.”

He has obviously had the benefit of a relaxing summer to consider the situation and determine whether that statement was in fact true. It now seems that it cannot have been true, because we have no fewer than 128 amendments from the Government to their Bill. I submit that never in the field of discussion of legislation has a Bill been so amended by its proposers and still managed to fall so far short of its declared objectives.

None the less, it is welcome that second thoughts are being had and that some improvements are being made. The first improvement is on the question of permanence, although I wonder why it has taken until now to happen. It is good that new clause 12 contains the agreement that the Scottish Parliament will not be taken away, dissolved or otherwise removed without first a plebiscite among the Scottish people to see what they want to do. I am pleased that the Secretary of State, in tabling that new clause, recognises where sovereignty lies on that question. It should lie with the people of Scotland whose government we are discussing. I invite the Secretary of State to support new clause 36 which would enshrine that principle of sovereignty a little more. It provides that in future discussions about the arrangements for the government of Scotland, it should be the people of Scotland’s Parliament that determines what those discussions are and the timetable by which they are put to the people in a referendum. That is only a logical extension once it has been conceded that sovereignty should lie with the people. If it is not the Scottish Parliament that should consider and respond to a future referendum, should there be one, who else should do so? It would be ridiculous for this Parliament to retain that power for itself.

The Smith commission was clear when it said that the Sewel convention should be enshrined in statute. The Bill still—after all this time—does not make that happen. The Sewel convention says that the “imperial Parliament” —to quote the hon. Member for Gainsborough (Sir Edward Leigh)—should not interfere in devolved decisions by the Scottish Parliament or other devolved Assemblies. The SNP’s new clause would enshrine that convention in law and enshrine the principle of subsidiarity—decisions being taken as close to the people as possible.

[Ian Murray]

Given the codification of the Sewel convention in new clause 36, I give the hon. Gentleman—my constituency neighbour—a commitment that we will support him if he presses it to a vote this evening. Perhaps we will attract further support and it will be carried.

[Tommy Sheppard]

I am grateful to the shadow Secretary of State for his support on this matter. The principle is clear: you do not keep a dog and bark yourself. Once power has been devolved to organisations, they must be allowed to get on with it.

I was disappointed that the hon. Member for Nottingham North (Mr Allen) took almost 20% of the time available for this debate not to discuss constitutional principles about the governance of Scotland, but to pursue his concerns about the decentralisation of services. What we are discussing is a change in the constitutional arrangements between Scotland and England within the Union. We are talking about giving more authority and competences to the Scottish Government, and that is not the same thing as the decentralisation and better administration of public services in England. The hon. Gentleman was wrong to do that and is unlikely to have made friends to support his argument as a result.

My final point is on full fiscal autonomy. I think that some of our opponents thought that when we did not get that through the last time, we would forget about it. Believe me, we have not forgotten about it. We want the Scottish Government to have control over the economy in Scotland. We want the ability to grow our economy and for our priorities to be set in line with the aspirations of the people who live in Scotland. I heard some interesting arguments from the hon. Member for Gainsborough and others in favour of full fiscal autonomy, but I have yet to hear a principled argument against it. The hon. Member for Edinburgh South (Ian Murray) often talks of a black hole, but that is not an argument in principle against full fiscal autonomy—against giving the Scottish Government control over economic affairs. It is an argument for saying that we should prepare for that devolution of powers and make sure that we get it right. I hope that the hon. Gentleman will come round to that way of thinking. We will object to the proposal to give a Conservative Secretary of State the power to set up a commission to look into whether full fiscal autonomy could happen, because he has already made his intentions in that regard clear.

We will come back to this issue, and it will be the subject of future debate in Scotland. The grandest commission of all on this debate will be the electorate of Scotland, who will get another opportunity in six or seven months’ time to decide whether they want better economic powers for their Government. We will get another mandate and come back to make that argument again.

My right hon. Friend the Member for Moray referred to the fiscal framework. It is not for us today to get involved, or even seek to influence, the discussions between Scottish and UK Ministers on the fiscal framework, but we have to be clear about what is at stake. The Smith commission was clear: it said that whatever powers are devolved to Scotland in this or any other settlement, it should be at no detriment. In other words, at the point of transfer of the power, the Scottish budget should not suffer as a consequence. I want to hear from the Secretary of State whether he believes in that principle. Is it guiding his discussions with Scottish Ministers? If it is used simply as a device to cut the Scottish budget and not provide adequate funding for the delivery of the new powers, he will do his cause a great disservice and hasten the day that we come back with a new Bill that will be a considerable improvement on this one.

--- Later in debate ---

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

In the wake of Scotland’s referendum on independence last year, the Prime Minister set up the Smith commission to secure cross-party recommendations for the further devolution of powers to the Scottish Parliament. With regard to the constitutional aspects of the report, the Smith commission recommended that the permanence of the Scottish Parliament and Government be established in statute, ensuring that devolution could not be abolished at the whim of a Westminster Government. Therefore, I sincerely welcome the UK Government’s latest U-turn on this issue. The provision should have been included at the inception of the Scotland Bill, but I welcome the Government’s coming round to our way of thinking—better late than never, some might say.

The Smith commission report also stated that the Sewel convention should be put on a statutory footing by the UK Government. Unfortunately, the UK Government’s proposals in this area fall far short of Smith, despite the Prime Minister’s pledge to implement the commission’s proposals in full. Clause 2 of the Bill states that

“the Parliament of the United Kingdom will not normally legislate with regard to devolved matters without the consent of the Scottish Parliament.”

The Government’s current position on the matter is ridiculous and risks weakening, not strengthening the Sewel convention, and it is at odds with the Smith commission report. The Government’s vow that they will “not normally legislate” in devolved areas will simply not suffice and raises serious concerns that it will set a dangerous precedent.

Indeed, from my work on the Immigration Bill Committee, I can already see one instance where the UK Government’s Bill encroaches on devolved areas in Scotland. For example, immigration is of course a competence reserved for the UK Parliament, but housing is not: it is devolved to the Scottish Parliament. Yet, as part of the Immigration Bill, the UK Government will introduce the right to rent. This is legislation that will compel landlords to establish a person’s legal status before they can offer a tenancy, introducing penalties for landlords who fail to comply. The UK Government’s “right to rent” provisions in the Immigration Bill will be extended to Scotland through secondary legislation without a legislative consent, or Sewel, motion being debated and passed by the Scottish Parliament. Furthermore, consultation with the Scottish Government on housing and with housing stakeholders in Scotland ahead of that Bill being introduced is said to have been rushed and extremely limited.

The Scottish Government are very concerned at this development and the Scottish housing Minister wrote to the Immigration Minister asking for a meeting on this very subject, only to be arrogantly rebuffed by him. In his reply, he said:

“The Right to Rent scheme and the new measures in the Immigration Bill relate to immigration control, which is not devolved”—

so far correct—but then said:

“These measures restrict access to housing”.

We have already established that housing is very much a devolved issue. So much for the respect agenda, much lauded by the Prime Minister.

The SNP’s new clause 35, which would place the Sewel convention on a statutory footing, is pragmatic and would ensure that the Bill lived up to the Smith commission’s recommendations. The UK Government’s approach to policy making where there are wider implications for devolved areas can be ignorant and churlish. There is no better example of that than the Conservatives’ much trailed desire to abolish the Human Rights Act.

[Ian Murray]

The hon. Gentleman is making an incredibly compelling argument about legalising and codifying the Sewel convention. If he wishes to push new clause 35 to the vote in a few minutes’ time, we would be more than happy to support him and take this forward. Otherwise, I am afraid it will be down to the other place to deal with.

[Gavin Newlands]

I appreciate the shadow Secretary of State’s support on this matter, which I will take up with my colleagues.

The Human Rights Act is vital to us in many ways. It gives us the right to life, freedom from torture, the right to liberty and security, freedom of thought, belief and religion, the right to private and family life, freedom of expression, assembly and association, and the right to free elections and education, to name a few. The Human Rights Act extends to all public authorities in Scotland—our schools, our local government, our NHS and our police. Amendment 204 would devolve responsibility for human rights to the Scottish Parliament, putting it beyond any doubt whatever, to help to safeguard human rights for those living in Scotland.

The potential abolition of the Human Rights Act will undoubtedly have profound implications for devolution in Scotland and across these islands. It would be an affront to democracy for the Conservative Government to use their slender majority in this House to abolish the Human Rights Acts when they do not command support in Scotland, Wales or Northern Ireland. Our new clause 35 would require the UK Government, regardless of political hue, to seek a legislative consent motion in all instances of Westminster legislation affecting areas devolved to Scotland, and would require the UK Government to consult the Scottish Government on legislation that would have such an impact on Scotland.

The Tory Government—formed by a party to which the people of Scotland delivered a vote of no confidence at the last election; a party with only one MP in Scotland—have rejected every amendment put forward by the SNP Westminster group, a group that has 95% of Scotland’s MPs. That prompts the question: why are amendments to the Scotland Bill that are supported by an overwhelming majority of Scotland’s MPs ultimately rejected? The Conservatives—and, indeed, Labour—must stop ducking, diving and obfuscating when it comes to strengthening the Scotland Bill and must stop playing games with Scotland’s powers. The people of Scotland are watching. It is time they were listened to.

--- Later in debate ---

[Ian Blackford]

I always agree with my right hon. Friend the Member for Gordon (Alex Salmond); the point is that it is the Scottish people who are ahead of this Parliament. We have to reflect on what is happening in this Bill. We were promised devo-max—as close to federalism as we could get; home rule in the spirit of Keir Hardie. It is this House and those on the Government Benches who are letting down the people of Scotland, and the people of Scotland will reflect upon that.

[Ian Murray]

I always enjoy listening to the hon. Gentleman making his passionate speeches in this Chamber. I wonder, for the sake of clarity, whether he could read the second line of what the former Prime Minister said about federalism.

[Ian Blackford]

The point is that the Scottish people were promised by Gordon Brown that we were going to get “powers for a purpose”—that we were going to have a powerhouse Parliament—and that is not what is being delivered tonight.

[Ian Blackford]

Despite what the Secretary of State says, the reality of the situation is that 70% of powers over taxation and 85% of powers over welfare will be held here at Westminster. I do not know what that is, but it is certainly not a powerhouse Parliament.

In the light of the challenges we face with the cuts to tax credits, which we will discuss in the second part of tonight’s debate, we need to make sure that the Scottish Parliament has the powers to protect the people of Scotland. We will be saying to the Labour party, “Come with us. Show that resolve,” to make sure that we can protect the people we need to protect in the country of Scotland.

[Ian Murray]

If the hon. Gentleman is truly passionate about protecting the people of Scotland, he will no doubt get to his feet and tell this Chamber and the people of Scotland that he will restore to them any losses from tax credits, as the Scottish Labour party has committed itself to do.

[Ian Blackford]

The Scottish National party in power in Scotland over the last few years has sought to mitigate the cuts that have come from Westminster, with £100 million invested for the Scottish people to offset the impacts of the bedroom tax. We will fight to defend the interests of the Scottish people, as we always have done.

--- Later in debate ---

[Ian Murray]

I am grateful to the Secretary of State for his clarification on gift aid. That is a significant concern for the charity sector in Scotland, which will welcome his reassurances. On that basis, we will not press new clause 4 to a vote.

[David Mundell]

I thank the hon. Gentleman for that.

I also thank the hon. Member for Edinburgh East (Tommy Sheppard). I usually disagree fundamentally with his contributions, but I always enjoy them. I also commend him on winning the new MP of the year award from The Spectator. He and the hon. Member for Paisley and Renfrewshire North (Gavin Newlands) touched on the Sewel convention—the legislative consent motion procedure in the Scottish Parliament. I am afraid that I do not agree with their proposals. The Sewel convention has been set out in the Bill, as required by the Smith commission.

--- Later in debate ---

[David Mundell]

Let me begin by dealing with the specific issue of welfare funds, on which I am accepting an amendment that the SNP tabled in Committee. The Smith commission agreement stated that the devolution of welfare foods should be the subject of further discussion between the UK and Scottish Governments. This has taken place, and I am pleased that new clause 14 and consequential amendments 79, 80, 82 and 83 devolve powers to the Scottish Parliament concerning welfare foods. They will be able to abolish or amend existing schemes, which includes the nursery milk scheme and health start scheme, or make new schemes for the provision of welfare foods.

On welfare more generally, the Government are proposing a number of changes to the welfare clauses, responding to a number of comments made by Members of this House in Committee, as well as the Scottish Parliament and other stakeholders. As a result, it will be beyond doubt that the Scotland Bill fully delivers on the Smith commission agreement and that the Scottish Parliament will have significant responsibilities for areas of welfare. I was pleased to see these changes receiving a full endorsement from Gordon Brown, from the Scottish media, and indeed from all objective observers. The Scottish Government are getting responsibility for disability and carer’s benefits that were worth £2.7 billion in Scotland last year, and they will be able to deliver new benefits in all areas of devolved responsibility if they wish. Amendments 70 and 71 to clause 19 ensure that the Scottish Parliament can, if it wishes, legislate for the payment of a carer’s benefit to a person who is under 16, is in full-time education or is gainfully employed. The Scottish Government will be able to pay anyone on a reserved benefit a top-up payment. That includes being able to top up benefits such as tax credits, child benefit and universal credit.

[Ian Murray]

For the sake of clarity, will the Secretary of State say whether the Scotland Bill, as drafted this evening, will allow the Scottish Parliament to top up tax credits?

[David Mundell]

I have said it on numerous occasions and I am very happy to say it again: the Scotland Bill, as it progresses through the House this evening, will allow the Scottish Parliament to top up tax credits, and indeed child benefit and elements of universal credit. The Scottish Government will be able to pay shorter-term payments to help anyone, regardless of whether or not they are entitled to a reserved benefit, who has an immediate need for them and whose wellbeing is at risk.

I have proposed important changes to the Bill so that the Scottish Parliament can create its own new benefits in any area of devolved responsibility. That will be achieved by new clause 34 and amendments 191 to 193. The Scottish Parliament will be able to do this without any need to consult the UK Government. This power is significant: the Scottish Parliament will no longer be able to say that it is constrained by Westminster in deciding what it does, and it will be able to choose what additional benefits to offer people in Scotland.

I must, however, make very clear a few important points about the new power that the Scottish Parliament will get to create new benefits in devolved areas. Any new benefits that the Scottish Government want to deliver will be in parallel to the benefits that are delivered by the UK Government. The new power does not affect Westminster’s ability to legislate for and to deliver support, and it does not enable the Scottish Parliament to change or amend reserved Westminster legislation in any way. The Scottish Parliament will need to both fund and deliver any new benefits from Scottish funds.

The House will be aware that we have also delivered on other areas of Smith in full. Scottish Ministers will be able to make regulations for certain elements of universal credit, such as the frequency of payments and to whom they are paid.

--- Later in debate ---

[David Mundell]

No. I have dealt with that issue.

There was much debate in Committee on the universal credit powers. There were many inaccurate accusations that the UK Government would have a power to veto decisions of the Scottish Government. To put this beyond reasonable doubt, I have tabled amendments to clauses 24 and 25 to make it clear that there is no UK veto over decisions that the Scottish Government make in this space. Amendments 77 and 78 will strengthen the drafting of those provisions. The Secretary of State for Work and Pensions will remain legally responsible for the delivery of universal credit, but both Governments will need to work collaboratively to consider any such changes to the elements of universal credit. That is at the heart of clauses 24 and 25, and I know that our officials have already had very constructive discussions with the Scottish Government on this subject. To ensure that the record is crystal clear, let me say that there are no UK Government vetoes anywhere in these welfare and employment clauses.

I would like to emphasise that we have listened to the Scottish Government and to the debate in the House. For example, amendment 72, which enables the Scottish Government to provide non-financial assistance for maternity, funeral and heating expenses, reflects an amendment the SNP tabled in Committee. After full consideration, the Government are happy to make this change. Amendments 73, 76, 191 and 192 also relate to that provision.

All in all, this settlement fully reflects the agreement reached by the Smith commission. It ensures that the areas that the agreement said should remain reserved—pensions, universal credit, sanctions and conditionality, and employment support delivered by Jobcentre Plus—remain the responsibility of the UK Government, but, importantly, it gives the Scottish Parliament full responsibility for many areas of welfare. The Scottish Parliament will have the autonomy to legislate for large areas of welfare, and I look forward to the beginning of the debate on how it intends to use those powers.

The Smith commission agreement also recommended the devolution of abortion legislation, given that the parties to the agreement were strongly of the view that the anomalous reservation needed to be corrected. As I announced last month, UK and Scottish Ministers and officials have held discussions on the matter and reflected very carefully about the practicalities of devolution in this area.

[Ian Murray]

I am grateful to the Secretary of State for accepting a lot of the Labour amendments, and indeed some SNP amendments tabled in Committee. He said quite clearly in Committee back in July that he would not devolve abortion without a proper process and full consultation and discussion with Scottish women’s groups. What has made him change his mind?

[David Mundell]

I do not think that that is an accurate reflection of what I said. I made it very clear that the Smith commission had recommended the devolution of abortion and that we were engaged in a discussion with the Scottish Government. We have of course engaged with women’s groups in Scotland. The groups to whom I have spoken are clear that abortion can be devolved.

--- Later in debate ---

[Dr Whiteford]

I am glad that the hon. Gentleman has asked that question so early. Had he been listening to events in the Scottish Parliament last week he would know that Nicola Sturgeon has made clear commitments to mitigate the impact—

[Ian Murray]

Will the hon. Lady give way?

[Dr Whiteford]

Let me answer this question.

Nicola Sturgeon has made a clear commitment to mitigate the impact of the tax credit changes, but—like the Prime Minister—she is in the dark about the exact proposals. George seems to be still writing them on the back of an envelope. We are clear that it will not be possible to quantify them for two and a half weeks yet.

--- Later in debate ---

[Ian Murray]

I am delighted that the hon. Lady has given way, but she did not quite answer the question put to her by my hon. Friend the Member for Great Grimsby (Melanie Onn). Is the hon. Lady committing tonight to restore all the losses from the pernicious tax credit cuts by this Tory Government? Her party voted against that in the Scottish Parliament last week.

[Dr Whiteford]

I really wish that the shadow Secretary of State had voted against the tax credit proposals when they came before this House on 20 July, because that would have killed them dead. Labour Members did not, however, and that is why we are back where we are. Nicola Sturgeon has made it crystal clear that she intends to bring forward costed, credible plans once the autumn statement has been made.

For low-paid working families, tax credits are an essential source of income. They put food on the table and shoes on the feet of children. They heat homes during winter. By the end of this Parliament, the Government’s proposed tax credit cuts would take £3.2 billion out of the Scottish economy from the pockets of the poorest families. That will undermine economic recovery. The austerity measures already enacted are set to push 100,000 more children in Scotland into poverty by 2020. Under the tax credit measures, 350,000 Scottish youngsters are set to lose out further. No wonder the Tories have abandoned any attempt at measuring child poverty.

There is a broad consensus in Scotland that cutting tax credits is the wrong thing to do. Even the leader of the Tory party in Scotland has called for a rethink and said that it is wrong for low-paid workers to lose out. It is recognised that the proposals will disincentivise work, hit children who are already disadvantaged and punish those in lower paid jobs.

The House of Lords put a proper spanner in the works of the proposals the other week, when it forced the Government back to the drawing board on their tax credit plans. Like millions of families across the UK who are facing uncertainty, we are all in a degree of limbo at the moment. We will have to wait until the autumn statement to learn what the Government intend to bring forward to make their plans more palatable to their own Back Benchers, who seem rather thin on the ground tonight.

We in the SNP have been very consistent in our opposition to tax credit changes. We have made the case at every single opportunity for alternatives to regressive austerity cuts. We will continue to fight tax credits tooth and nail in this House to force the Government into a climbdown. I hope we can rely on the support of other Opposition parties to stand firm, too. Labour abstained on 20 July, when we debated the general principles of the Welfare Reform and Work Bill that ushered in these proposals. The Government’s new clause 34, tabled last Wednesday, represents some progress. I am grateful for that, because it acknowledges that there was a veto and it manages to deal with that to some extent. New clause 34 would partially mitigate the impact of the tax credit cuts, but our new clause 18 is much stronger. It would fully devolve control of our tax credits to the Scottish Parliament, including eligibility thresholds and tapers. Government new clause 34 will give the Scottish Parliament the power to top up benefits. That is fine as far as it goes, but it will be no help whatever to those people who have lost their tax credits entirely as a consequence of the changes. If someone is not in receipt of a benefit, it cannot be topped up.

--- Later in debate ---

[Mr McFadden]

The House is very pressed for time.

We have had experience of what happens in those circumstances. We know that 10 women a day have travelled here from the Republic of Ireland because of the different legislative frameworks. I do not predict that that will happen in this instance, but the new clause allows for the possibility. The logic was right before. There is no logic in allowing for two legislative frameworks 18 years on.

[Ian Murray]

It is a pleasure to talk to our new clauses and amendments on this part of the Bill. We have a lot of ground still to cover in this short debate, but it is important to state at the outset that crucial welfare clauses in this Bill deliver on the vow and the Smith agreement in both spirit and substance. That was not the case before the Government tabled their latest tranche of amendments last Monday. That is why, as my SNP colleagues rightly highlighted earlier, the deputy leader of the Scottish Labour party said that the vow had not been met, and indeed the architect of the vow, the right hon. Gordon Brown, the former Prime Minister, made exactly the same points. However, now that the amendments are before the House, we believe that the benefits issue has been resolved and that therefore the vow has been delivered. This is a crucial victory for the Scottish Parliament, the importance of which cannot be overstated. I said at the end of the Committee stage that if the Government did nothing else they should concede to my amendment 31 to allow the Scottish Parliament the power effectively to design its own social security system. Their new clause 34 does that, and we will support them on it.

[Stephen Gethins]

Does the hon. Gentleman think that the proposals are as close to federalism as we can get? Yes or no will do the trick for me.

[Ian Murray]

I am delighted that the hon. Gentleman intervenes with that question, as it allows me to put the record straight. What SNP Members do not mention is the second part of the sentence that the right hon. Gordon Brown said. That was: as close to federalism as we can get in the context of 85% of it being one block called England. That is what he said, and SNP Members never ever talk about that when they talk about “as near to federalism as possible.” The right hon. Gordon Brown can speak for himself when he says these things, and that is exactly the context in which he put this Bill.

The right hon. Member for Gordon (Alex Salmond) agreed with the amendments on welfare proposed by the Secretary of State. We agree as well, and I would have thought that there would be some kind of consensus across the Chamber on these amendments.

Let me turn to new clause 2 and Government new clause 34. Part 3 of this Bill devolves to the Scottish Parliament new and substantial powers over welfare, transferring to it £2.5 billion-worth of welfare responsibility. As I said when we debated this part in Committee, this presents a real opportunity for Scotland and the Scottish Parliament. Today we will pass amendments that will fundamentally transform the Scottish Parliament’s relationship with the social security system. That is why the Bill is so important. According to the House of Commons Library, if the Bill were passed in its present form, the Scottish Parliament would be responsible for 62% of all public expenditure, but our new clause 2 and the Government new clause 34 will give the Scottish Parliament total freedom to create new benefits in all devolved areas. It would then be up to the Scottish Government of the day to design the system they want and the Scottish people have voted for, and to find the resources to pay for that system.

The same goes for Government new clause 14, which devolves the Scottish Parliament’s legislative competence regarding welfare foods. I believe that was an SNP proposal, and, again, we support it.

The power to create new benefits in devolved areas was a Smith agreement recommendation and delivering on that commitment has been an absolute priority for the Opposition. We tabled the initial new clause in Committee, which the Government voted against, but I am delighted that the Secretary of State and Government have now come over to our way of thinking, as they have on the veto and the carer’s allowance. As the SNP finally conceded halfway through a Scottish Labour debate in the Scottish Parliament last week, and as we have heard again tonight, the original clause 21 and this new clause also afford the Scottish Parliament the power to top up any reserved benefit. There can now be no doubt that the Scotland Bill will allow the Scottish Government to compensate fully the Scottish families affected by the Government’s pernicious cuts to tax credits.

[Callum McCaig]

The reality is that Scotland will pay for the administration of tax credits and it will also pay for the administration to top-up tax credits. Rather than just devolving the provision, why should we pay for its administration twice under what the hon. Gentleman is proposing?

[Ian Murray]

The proposal would allow for the top-up of any reserved benefit and for the introduction of any devolved benefit. So, although we use the term “restoration”, it would actually create a new top-up reserved benefit, as does the Bill. There is a lot of misunderstanding relating to the fact that a lot of these benefits are not being devolved; they are effectively being switched off. The Scottish Government would therefore have to introduce new proposals in relation to any of the provisions in the Bill.

[Callum McCaig]

rose—

[Ian Murray]

We are running out of time, so I shall press on.

We will not cut tax credits for Scottish working families. Kezia Dugdale, the Scottish Labour party leader, has made that quite clear, and we have been very clear about how we would pay for that. It is interesting to note that on four different occasions tonight we heard nothing from the SNP about whether it would match that commitment—

[Ms Ahmed-Sheikh]

Twice!

[Ian Murray]

The hon. Lady says “twice”, but the record will show that ours is a clearly costed policy that would be delivered using the new powers in the Bill.

[Several hon. Members rose—]

[Ian Murray]

I shall move on, because we are running out of time—[Interruption.] We have already heard complaints about the restricted time for the debate. I would have thought, given that we agree on the welfare provisions, that the braying mob on the SNP Benches would have taken a little time to run through some of them.

Now that the Secretary of State has come round to Labour’s way of thinking on the power to create new benefits, the Bill strikes the right balance between reserved and devolved areas. The Smith agreement said that the welfare state and the social security system should remain shared across these islands. New clause 3, whose provisions are linked to new schedule 1, would provide for a cross-Parliament Committee on welfare devolution to oversee the transition and implementation of welfare powers transferred by the Bill. That would go some way towards resolving the point raised by the hon. Member for Aberdeen South (Callum McCaig). The Scottish Council on Voluntary Organisations has welcomed the new clause, stating that it is a

“pragmatic proposal given the need to ensure continuous, timely delivery of social security payments to those who receive them.”

It goes without saying that any new Committee must be open and transparent. We have already seen the Scottish Government claiming that they might reject the Scotland Bill if the secretive fiscal framework is not to their liking. We cannot afford for that to happen with these important welfare provisions.

Turning to new clause 5, I have said that Labour’s key aim is to deliver in full on the recommendations of the Smith agreement, but we are prepared to go beyond it if we see a reasonable argument for doing so. The new clause goes beyond the agreement in seeking to devolve the childcare element of universal credit to the Scottish Parliament.

Amendments 21, 22 and 23 cover another area in which I believe we should go beyond the Smith agreement’s recommendations—namely, making payments to individuals who have been sanctioned. The hon. Member for Banff and Buchan (Dr Whiteford) mentioned this in her eloquent speech. The Labour party is committed to reviewing the UK sanctions regime, the punitive nature of which is beginning to spiral out of control, forcing people into destitution on the back of draconian DWP targets. That is why we believe that the Scottish Parliament should have the power to make payments to individuals who have had payments unfairly reduced, suspended or withdrawn due to the UK Government’s sanctions regime.

We have also tabled amendments 24 and 25, which I shall address alongside Government amendments 77 and 78. These all concern the perceived existence in the Bill of a UK ministerial veto in relation to the regulation-making powers for universal credit being transferred to the Scottish Parliament. I am grateful that the Secretary of State has again listened, not only to the Labour party but to the SNP, on this issue. The Government have now redrafted the relevant clauses and removed the perceived veto. When I wrote to the Secretary of State asking him to confirm this, he gave me an assurance that the UK Government would have a “legal obligation” to implement any changes made by Scottish Ministers.

I welcome the Secretary of State’s amendments 70 and 71, which will remove the restrictive definitions relating to carer’s allowance, but I am disappointed that he has not removed the similar definitions in relation to disability allowance, as many of the disability charities in Scotland requested. Amendment 194 offers an alternative broader and more flexible definition of disability benefits, and I hope that if the Secretary of State cannot give us a satisfactory answer on this matter tonight, we will pursue it in the other place at the Bill’s next stage.

Let me deal briefly with the issue of abortion, making it clear from this Dispatch Box that nobody in this Chamber is saying that the Scottish Parliament does not have the capacity or indeed the responsibility to deal with abortion. The Smith agreement said that there would be a process, and, as we have heard eloquently this evening from my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), the devolution of abortion has to be dealt with properly and sensitively. The Secretary of State avoided my intervention earlier. He said in this House in July that the Smith agreement did not allow for the devolution of abortion at this stage and it would not be in this Bill, but that a proper process would be put in place to ensure that it is done sensitively, properly and in consultation with women’s organisations in Scotland. I do not think that his frantically calling round women’s organisations in Scotland on the day he tables the amendment is satisfactory consultation or that it takes into account the issues that many women in Scotland have contacted me about.

This is not about the time limit for abortion; this relates to the entire complex matrix of the legislation that sits behind abortion. It is about the issues relating to the criminality of abortion, the authorisation of abortion and where abortions can be carried out. It is not just about 24 weeks; it is about much more than that. The Secretary of State should reflect on the fact that a proper consultation needs to be put in place, otherwise he is in danger of doing something incredibly dangerous to abortion in this country.

[Mr McFadden]

The Secretary of State has said time and again when taking interventions that the Scottish Parliament has the capacity to legislate on abortion. Does my hon. Friend agree that it is a question not of whether there is capacity, but of whether or not it is desirable to have two different legislative regimes for this in Scotland and England?

[Ian Murray]

Regardless of who legislates for it, we may end up with different legislative regimes on either side of the border. I am perfectly confident in the Scottish Parliament, and I take the First Minister’s word that she will not change the regulations, but that is not to say that the regulations down here might not change and we end up with abortion tourism. Nobody wants that across the United Kingdom, and my right hon. Friend, who took the Scotland Act through this place—

[Mr McFadden]

No, I did not.

[Ian Murray]

My right hon. Friend did not take it through this place but he was heavily involved in it, and he knows about the issues relating to abortion and the position taken.

Amendment 26 makes it explicit that, among the exceptions to reserved matters on equal opportunities, the power to set gender quotas is being devolved to the Scottish Parliament. The Labour party takes this issue very seriously, and we thank Women 50:50 for helping us with these issues. I also commend amendment 225.

We now have a welfare section in this Bill that is in line with the Smith agreement. Everyone in this Chamber should be incredibly proud of that achievement and now we must move on to the debate about how we use these powers.

[David Mundell]

I do not want to say too much more at this stage, other than to welcome the fact that, other than in relation to the issue of abortion, to which I shall return, the Government’s proposals have been accepted. I am grateful for that.

In Committee, I said we would listen to sensible proposals made in the context of the Smith agreement, and that is what we have done. That is why I am not persuaded by some of the amendments, particularly those set out by the hon. Member for Banff and Buchan (Dr Whiteford) on the welfare system. They do not relate to areas that form part of the agreement. As we have mentioned on other occasions during this debate, the SNP was of course part of the Smith commission process and it signed up to an agreement that at that point did not seek to devolve tax credits to the Scottish Parliament. What was devolved were extensive powers that allow the topping up of tax credits and other benefits; the creation of new benefits in devolved areas; the topping up of child benefit; and changes to be made to income tax—

--- Later in debate ---

[Ian Murray]

I echo the Secretary of State in thanking everyone who has been involved in the Bill’s passage, including his officials and the people who have been so supportive to Labour Members. I thank my Parliamentary Private Secretary, my hon. Friend the Member for Stoke-on-Trent North (Ruth Smeeth), and, of course, my hon. Friend the Member for Caerphilly (Wayne David), who has spoken on many parts of the Bill, but I also thank the Clerks in the Public Bill Office, who have been incredibly helpful in putting the Bill together. It has been like wading through treacle at times, but they have always been courteous, and their advice has always been well received.

Let me be absolutely clear at the outset about the Labour party’s position. We fully support the Bill and all that it seeks to achieve. [Interruption.] One would think that SNP Members would just stop for two minutes during the Third Reading debate. When the Conservative Secretary of State spoke, there was complete silence, but when the Labour party speaks, the braying mob starts. That tells us all that we need to know about this place.

With the amendments that have been accepted this evening, the vow has been delivered in full. The Bill delivers on the powers promised and agreed by all parties, including the SNP, in the Smith commission.

In 1998 Donald Dewar said:

“There shall be a Scottish Parliament”—[Official Report, 12 January 1998; Vol. 304, c. 25.],

and it was Labour, with the consent of the Scottish people, that delivered that Parliament. This Bill will make the Scottish Parliament one of the most powerful devolved legislatures in the world. It meets not only the terms of the vow, but the timetable laid out by Gordon Brown last year. We promised a process by the end of October; it was delivered. We promised it would conclude by St Andrew’s day; it was delivered. Draft legislation was promised by January; it was delivered. Second Reading of the Scotland Bill was promised straight after the election, regardless of who won; that was delivered. We promised that, no matter what parties formed the Government after the election, we would deliver a Bill to meet what the Smith commission set out; and thanks to the Secretary of State’s amendments put forward on Monday, that has been delivered. It is absolutely clear that this Bill, as amended, will place at the Scottish Government’s disposal the powers to make Scotland the fairer and more equal country that we all aspire for it to be.

[Patrick Grady]

Will the hon. Gentleman give way?

[Ian Murray]

I am not going to take interventions because I want the SNP opposition spokesman to speak, and if I take interventions he will be talked out.

From the establishment of the Scottish Parliament to the Calman commission to the Scotland Act 2012, Labour has supported more powers for the Scottish Parliament, but we are absolutely clear about what we stand for: we believe in devolution, not separation. That is what the people of Scotland voted for last year, and we respect the sovereign will of the Scottish people. They said they wanted to remain part of the United Kingdom but with a strong Scottish Parliament. They said they wanted to continue to pool and share resources across these islands. They said that they wanted the continued security that being part of a bigger union of nations and family of nations brought.

The Bill provides an historic opportunity for our politics in Scotland to turn from talking about the constitution to talking about the country, and about what we can do to make Scotland the fairest nation on earth, instead of what we cannot. Let’s grasp that opportunity. Let’s build that fairer nation. Let’s give the people across Scotland the politics they deserve. In the words of Donald Dewar, there shall be a powerful Scottish Parliament.

Scotland Act 1998 (Modification of Schedules 4 and 5) Order 2015

Ian Murray Excerpts

Monday 14th September 2015 General Committees

[Ian Murray (Edinburgh South) (Lab)]

As always, it is a great pleasure to serve while you are in the Chair, Mr Gray.

The Opposition do not disagree with the order. I thank the Secretary of State for his introductory remarks and I will pose just two questions in response to his explanation of the order. The first is a more general question of whether he envisages any other reasons for introducing a section 30 order before the Scotland Bill gains Royal Assent, hopefully very shortly in this Parliament. Secondly, the right hon. Gentleman did not touch on the modification of schedule 5 in article 3(2)(a), which refers to inserting

“‘The reduction of the minimum voting age’”

under “‘Exception 1’”. Will the Secretary of State cover in his summing up exactly what that means for devolving that power? I hope that it devolves the power to the Scottish Parliament to decide to allow 16 and 17-year-olds to vote.

I thank the Secretary of State for being here for his first Statutory Instrument Committee of this parliamentary term. However, it may be his last, and the Deputy Leader of the House will ably deputise for him in future such Committees—not because he has upset the Prime Minister; I do not want to start any vicious rumours of his demise from the Cabinet.

With those two brief questions, I emphasise that we are grateful for the order’s being introduced quickly so that the Scottish Parliament has the power to determine its elections timetable from next year.

Scotland Bill

Ian Murray Excerpts

Monday 6th July 2015 Commons Chamber

In conclusion, there is an opportunity to really deliver on the Smith commission if these obvious issues are addressed through our new clause. Communities across Scotland have been waiting for and are expecting the full devolution of the assets and revenues of the Crown Estate in Scotland. Let us see that promise delivered by making sure that the Bill lives up to the serious expectations of the people of Scotland. I commend new clause 57 to the Committee.

[Ian Murray (Edinburgh South) (Lab)]

It is a pleasure to serve under your chairmanship, Sir David. I was incredibly surprised to hear during an earlier point of order that this is apparently an English and Welsh only Bill, so perhaps that is the first point the Secretary of State for England and Wales would like to clear up when he comes to the Dispatch Box. It is a great privilege to speak for the Opposition on day four of the Committee’s considerations. I will speak to amendment 52, which is the first in this group standing in my name and that of my hon. Friend the Member for Caerphilly (Wayne David), and to all the other amendments and new clauses that stand in our names.

The Labour party has tabled 34 amendments to this section of the Bill, and 81 amendments to the entire Bill so far. It is a shame that the Secretary of State, who has been derided for some of this in the Scottish media, has not accepted any of these amendments, although he says that he is looking at the sensible ones. Will he enlighten the Committee on which amendments those are and on his direction of travel? That would allow to us shape some of our thoughts on Report.

[Alex Salmond]

That is indeed a mighty number of amendments. I am looking at the lack of support that the hon. Gentleman is carrying on his Benches. The hon. Member for Birmingham, Erdington (Jack Dromey) told us that he had organised the first strike in the House of Commons. From the look of the Labour and Tory Benches, that strike seems to be ongoing.

[Ian Murray]

Given the time limits that we have on this debate, I feel that we have just wasted 30 seconds through a rather unnecessary intervention by the right hon. Gentleman, but, as we always say, it is quality and not quantity when we are having these debates. [Interruption.] I find it strange that I have been on my feet for less than two minutes—I have barely got to the end of the first page of my speech, half of which has been amended—and the baying from SNP Members has already started. If they just sat and listened for a few moments, they might find that I actually agreed with them on some of these amendments. I would have carried on to the second page of my speech had not the right hon. Gentleman intervened on me at that point. [Interruption.] I feel that a bit of common courtesy might be called for in these important debates. In fact, we might get an awful lot further if we had a bit of common courtesy.

These parts of the Bill cover Scotland’s road and rail infrastructure, its Crown Estate territories, and controls over tribunals and equalities legislation. The Secretary of State and the UK Government must deliver on these proposals, and go further. However, it is also for the Scottish Government to explain what they want to do with these powers; to date, they have studiously avoided doing so. [Interruption.] We have heard a lot in today’s debate, but also in the other three debates—

[Alex Salmond]

It says here.

[Ian Murray]

It does say here, because it is a speech, and that tends to be what happens. The right hon. Gentleman chunters from a sedentary position, “It says here”, but he was reading from his iPad earlier—with 3% of its battery left, as he told the Committee. If we are not supposed to read speeches in this place, I am not sure what we are supposed to do.

[Alex Salmond]

rose—

[Ian Murray]

I will give way to the right hon. Gentleman, but first I say this: he is wasting the time of the Committee in a time-limited debate that should finish at 8.37 pm, and we want to get on to some of the substantive issues.

[Alex Salmond]

I was reading from the iPad because I was quoting from the Scottish Government document, “Empowering Scotland’s Island Communities”, released last year, which says exactly what the Scottish Government intend to do with the revenue from the Crown Estate in relation to island and local communities. Having learned that, would the hon. Gentleman now care to withdraw his remark?

[Ian Murray]

The right hon. Gentleman asks me to withdraw my remark, but he asked to intervene before I made it, so he obviously wanted to intervene about something else. As they used to say on the radio, “What’s your point, caller?” [Interruption.] I can stand here and waste time until 8.37 pm if SNP Members want me to. I believe that many of them want to speak, but if they want to continue to waste time, that is entirely up to them. I can stand here all evening and then allow the Minister to speak shortly before we move on.

I believe that most of the clauses in this part of the Bill match the spirit and letter of the Smith agreement, but we wish to make sure that there is clarity, and to go slightly further. We have identified areas where the Bill can go further, primarily by placing more specific duties on the Scottish Parliament and Scottish Ministers, and also on the Secretary of State to deliver on these powers. Labour’s amendments would require the Scottish Parliament to work towards gender balance in the membership of the Scottish Parliament and on the boards of Scottish public authorities; require the Scottish Parliament to establish a process to end the system of employment tribunal fees in Scotland; devolve the enforcement of equalities legislation to the Scottish Parliament; and make sure that Scotland can, if it so wishes, implement a not-for-profit people’s railway.

We have already heard some debate about the Crown Estate, so I will canter through this part of my speech rather quickly to allow other Members to speak. Clause 31 transfers management of the Crown Estate’s Scottish assets and income to Scottish Ministers. That terminology is vital in terms of some of the questions we have for the Secretary of State. These assets account for about 3.9% of Crown Estate revenues. They include several rural estates; commercial property in Edinburgh; mineral and salmon fishing rights; approximately half of the coastal foreshore; and almost the entire seabed, including rights on the continental shelf. Crucially, the clause does not transfer rights over joint investments. As the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) said, there has been considerable local press coverage about Fort Kinnaird in Edinburgh as it is not owned by the Crown Estate but is merely a joint investment. Why it is specifically excluded given that—the hon. Gentleman is absolutely right—even if it is just a 50% shareholding, it should be deemed to be an asset in terms of a being shareholding? It would be useful if the Secretary of State clarified that.

I largely agree with the clause as drafted, albeit with two small amendments. The first is the amendment tabled by the right hon. Member for Orkney and Shetland (Mr Carmichael). I understand that the reason for the current wording of the clause is that the Treasury requires the legislative consent of Scottish Ministers before making such a scheme. However, once that consent has been given, as I assume it would be, the wording does not definitely require the formation of a scheme. Our amendment 52 would replace reference in line 36 to “Scottish Ministers” with “Scottish Parliament”. Ministers are transient, whereas the Scottish Parliament is permanent, and that should be recognised in all the clauses of this Bill.

The transfer of Crown Estate assets entails the transfer of staff and tenants to a new employer and landlord. It is vital that that transition is as smooth as possible to minimise unnecessary disruption and anxiety to workers and to tenants. I would welcome an assurance from the Government that every effort is being made to ensure that that will be the case. The right hon. and learned Member for Beaconsfield (Mr Grieve) and the hon. Member for North East Somerset (Mr Rees-Mogg) asked some legitimate questions that the Secretary of State should take on board and try to answer.

Finally on the Crown Estate, will the Secretary of State deal with the issue of the coastal communities fund? That is not directly funded by the Crown Estate but by the Treasury as part of the revenues of the Crown Estate. Will that situation continue or will the responsibility transfer to the Scottish Government? The fund is hugely important for Scottish coastal communities, and it is important to get clarity on its continuation, whether paid for by the Treasury or by the Scottish Government.

We will support amendment 57, in the name of the right hon. Member for Orkney and Shetland, as we believe in the concept of double devolution to get powers into the hands of the communities best placed to use them effectively. I agree with what the right hon. Member for Gordon (Alex Salmond) said about coastal communities. I recognise, however, that the right hon. Member for Orkney and Shetland is using this as a probing amendment to make sure that the issue can be on the agenda. He is right that it does not have to be included in the Bill, but I am glad that it has been raised.

Clause 32 devolves powers over equal opportunities bodies to the Scottish Parliament. The Labour party has always been a staunch proponent of women’s rights and the promotion of female representation. As respected organisation Engender has observed, there is compelling evidence to suggest that lack of gendered power balance in the wider public domain has a major impact on equality of outcomes across Government Departments. I therefore welcome the transfer of these powers, which will add to the tools available to the Scottish Parliament to tackle gender inequality in all its guises. There are very few legislative opportunities to provide for meaningful advancement in these areas, so we should grab those opportunities when they arise. We have seen that voluntary quotas or non-statutory targets can go some way towards this but are not as effective as legislation.

Our amendment 123 would amend clause 32 to include a specific requirement for gender balance among Members of the Scottish Parliament and members of boards of Scottish public authorities. That would devolve the issue to the Scottish Parliament and allow for it to be debated and properly implemented there. The Scottish Parliament has achieved much to be proud of, but in this area we are lagging behind our European partners. We should also deal with the dreadful record on such issues in this place. In appealing for the Committee’s support on this, I reassert my belief that equality is not a party-political issue. I want us to work together on it. I thank the cross-party campaigning group Women 50:50 for their support for the amendment and their “It’s as easy as 123” campaign. I hope that Members will also support new clause 41, which would require Scottish Ministers to undertake and publish a review of the measures they are taking further to help and promote gender equality in the membership of the Scottish Parliament and on the boards of Scottish public authorities.

New clause 66, tabled by the hon. Member for Gainsborough (Sir Edward Leigh) and new clause 56, tabled by the hon. Member for Southport (John Pugh), propose the devolution of abortion law and other connected laws, with regard to the relevant section of the Scotland Act 1998, to the Scottish Parliament. We will vote against the new clauses if they are pressed to a vote because we believe that a woman’s right to choose should be determined by robust medical evidence and not by where they live.

There is no reason why women in Edinburgh should face a different experience from women in Exeter. Many would argue that the current system needs to be improved, but that would be best achieved in a UK framework and should be part of a debate separate from that on the constitution.

[Mr MacNeil]

That is remarkable, because those matters are linked to countries’ constitutions. The limits are different in almost each and every European country. Why cannot they be different or the same across the UK—whatever the most democratic forums in each part of the UK choose? I am surprised at the hon. Gentleman’s negation of democracy.

[Ian Murray]

The next part of my speech offers an explanation of our opposition to devolving that particular issue across these islands.

[Mr MacNeil]

What about Northern Ireland?

[Ian Murray]

The hon. Gentleman is chuntering again. I will come on to the Northern Ireland issue. This is an incredibly serious issue and we should discuss it in a sober, proper and mature manner. Whether someone is pro-choice or pro-life, these are incredibly sensitive and emotive issues to which we should give due consideration.

Our opposition to devolving this particular issue is threefold. First, we stand with the 13 organisations from Scottish civic society, including Amnesty International, Scottish Women’s Aid and the Scottish Trades Union Congress, which have called on us to vote against the amendments. We share their concerns that the proposal has not been properly consulted on and that, on existing evidence, it could lead to harming a woman’s right to choose. The statement they have sent to all Members of this House concludes:

“Women across the UK have fought for women’s bodies to be their own and, to this day, fight opposition to a woman’s right to choose. We do not wish this amendment to open the doors to those who seek to undermine this right.”

[John Pugh]

Does the hon. Gentleman seriously think that the Scottish Parliament would disregard those sentiments?

[Ian Murray]

I do not think that the Scottish Parliament would disregard them, but it is worth giving proper consideration to the Smith commission’s proposals and the cross-border issues, rather than just devolving the issue of abortion for the sake of it.

[Sir Edward Leigh]

May I have the hon. Gentleman’s view on the logic of allowing the Scottish Parliament to deal with assisted dying, which is just as emotive and important an issue, but not with abortion?

[Ian Murray]

That is the framework of the Scotland Act 1998.

[Mr MacNeil]

Is it logical?

[Ian Murray]

Well, devolution in a lot of instances is not logical, because—[Interruption.] I am answering the intervention of the hon. Member for Gainsborough. If the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) wants to intervene, I am more than happy to allow him to do so, but he must let me answer the intervention first. A lot of devolution is illogical, because that is how devolution works.

I hope that the hon. Member for Na h-Eileanan an Iar will allow me to get to the second and third reasons for our opposition to the devolution of abortion at this stage. As I have said, our first reason for opposing it is that we are being asked to do so by women’s organisations in Scotland. Secondly, the Smith commission clearly stated that

“a process should be established immediately to consider the matter further.”

That has not happened. On 21 July, a Scottish Government spokesperson told the BBC that talks with UK Government Ministers on the devolution of abortion law had begun prior to the election. I would welcome an intervention from the Secretary of State or, indeed, anyone on the SNP Front Bench to inform the House about the discussions that have taken place so far, but the Smith agreement is clear and the promised process has not emerged.

This is not the proper process for which Smith asked. I understand that the issue was put on the table rather late in the day at the Smith commission and that it was agreed that there would be a proper process of discussion, debate and dialogue before any particular change is made to the constitution or the law.

[Dr Philippa Whitford]

Does not the hon. Gentleman think that this could be the start of that process? If there is an agreement in principle that the powers will be devolved, that discussion can begin. If we throw the amendment out, it will disappear.

--- Later in debate ---

[Ian Murray]

There is a point of difference between us on how we interpret this issue. The 13 organisations that have written to us are experts in this field and have asked us to vote against the amendment, and I think we should listen to them. I do not disagree with the hon. Lady. Everyone has their own views, not only on this, but on the devolution process. I just feel that, having weighed up all the issues, we should listen to what the 13 organisations have said, follow the proper process outlined by Smith and see where we go.

The third reason for our opposition is that the UK already has a two-tier system on abortion, with a different legal position in Northern Ireland. That has been heavily criticised by human rights organisations and the United Nations. We do not wish to create yet another category of abortion law in the United Kingdom that could fall foul of them. That is not to say that devolution might not be desirable at some point in the future, but let us go through the proper process.

The devolution of abortion law would mean that the Scottish Parliament would have to start from scratch. The law is established and is operating effectively in the United Kingdom. It should continue to operate across the UK and be determined by the best clinical advice available.

New clause 64 would fully devolve responsibility for enforcement of equalities legislation to the Scottish Parliament. An important principle of devolution is that it should not lead to the exercise of power becoming disjointed across nations. As some of my hon. Friends have made abundantly clear, we believe that legislation on employment rights must remain consistent across the United Kingdom in a single market, in order to avoid any erosion of those rights and a subsequent race to the bottom on pay, terms, conditions and practices.

To quote the Trades Union Congress:

“Any move to devolve responsibility for employment and trade union rights could have profound implications not just for working people in Scotland, but across the whole of the UK. The TUC would strongly counsel against a ‘race to the bottom’, with the Scottish and Westminster governments competing to attract investment by promoting a more de-regulated labour market.”

That is what we see right across the world in terms of competing markets, particularly labour markets. I agree with the TUC. Given that we do not propose to devolve employment law, it would be neither consistent nor desirable to devolve equalities legislation, because they are inextricably linked. I will speak about the specific issue of the national minimum wage at the end of my contribution.

[Chris Stephens]

The hon. Gentleman has quoted the TUC, but in various debates on the Bill he has quoted the STUC. Will he confirm that the STUC is clear that employment law and health and safety law should be devolved to the Scottish Parliament?

[Ian Murray]

I do not disagree with the hon. Gentleman: that is the STUC’s view. The TUC takes a slightly different view. We have to be very careful, as the TUC points out, that we do not create a race to the bottom. As I have said, it strongly counsels against a race to the bottom.

[Mr MacNeil]

We want a race to the top.

--- Later in debate ---

[Ian Murray]

We all want a race to the top, but we need to make sure that we are doing all these things properly, with cross-border agreement between Governments both north and south of the border.

It would not be inconsistent to devolve the enforcement of equalities legislation, as suggested by the STUC and our new clause 64. The STUC argued in its submission to the Smith commission:

“Ultimately equality law is governed by European minimums and…the law as it currently stands is positive and tends to support the advancement of equality. The major barrier to achieving equality therefore is not the law, but practice, culture and indeed discriminatory attitudes. Therefore enforcement is key to advancing equality and major gains could be made if enforcement was carried out in line with Scottish expectations and the needs of the Scottish economy.”

I hope that Members will recognise the logic of that assertion and support new clause 64, which would allow for the creation of a bespoke enforcement regime in Scotland that would take a full view of the distinct nature of the Scottish equalities landscape, but within the UK and EU legislative framework.

Clause 33 devolves to the Scottish Parliament new powers over the administration of employment tribunals. My amendment 54 would add a specific requirement on Scottish Ministers to initiate a process, in conjunction with the Advisory, Conciliation and Arbitration Service and the Scottish trade unions, to end the system of employment tribunal fees in Scotland.

My amendment is barely different from an amendment tabled by SNP Members. We all wish to see the end of employment tribunal fees, because there is no doubt that the figures show that they are a barrier to justice. Those are not just my words; they are also included in a letter to the former Justice Secretary signed by 40 QCs and 400 barristers who argued that

“fees are a significant barrier to access to justice and are preventing employees from being able to complain about contraventions of their employment rights.”

The letter further observed:

“The introduction of fees has had no discernible impact on the outcome of cases.”

It surely cannot be fair for a pregnant woman who is being discriminated against at work and who might have just lost her job to have to find a £1,200 fee at a time when family budgets are more stretched in order to seek redress in an employment tribunal. When I was the shadow Minister for employment relations in the last Parliament, we made those arguments consistently during debates on the Small Business, Enterprise and Employment Act 2015. You may have chaired that Bill Committee, Sir David, so you will be well versed in those issues. This policy is fundamentally unfair; it is a tax on justice.

Fortunately for those of us in Scotland, the Bill is an ideal opportunity to do something about employment tribunal fees. Amendment 54 would enshrine in law the Scottish Government’s responsibility to establish a proper process to put an end to these pernicious and unfair charges in the Scottish tribunal system. I hope that we will get support for that amendment.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

There is agreement across the Opposition Benches on making employment tribunals fairer and eliminating the fees, but is the hon. Gentleman’s strategy not completely wrong? He wants fairness in Scotland that cannot be introduced in England. That is at odds with his arguments about having solidarity on both sides of the border. He is picking and choosing what he will support and what he will not support. He has a lack of strategy, rather than a strategic approach.

[Ian Murray]

This amendment is about people paying a fee to enter the employment tribunal system. It would give the Scottish Parliament full control over how that system operates, under the legislative framework of the United Kingdom. That is how a lot of issues work, including health and safety and the Scottish courts system. That is how the justice system in Scotland, which has always been independent of the rest of the UK, operates and it is a perfectly fair way for devolution to work.

Amendments 159 and 160 relate to fixed odds betting terminals and the supervision, inspection and enforcement under the Gambling Act 2005. My hon. Friend the Member for Hyndburn (Graham Jones) might go into that in more detail if he catches your eye, Sir David.

I am not sure whether the hon. Member for North Ayrshire and Arran (Patricia Gibson) is in her place, but in an earlier sitting of the Committee, she mentioned that the Scottish Parliament controls much of road safety, but does not have legislative competence over pavement parking. As she did not table an amendment to sort that out, we brought forward new clause 22, which has the full support of the Living Streets charity, to rectify the anomaly. It intends to ensure that parking offences such as parking on pavements or by dropped kerbs and double-parking can be enforced by the Scottish Parliament. I am grateful to Living Streets for bringing this matter to our attention. Having spent a day blindfolded with the guide dogs in Corstorphine in Edinburgh, I think we should all take cognisance of the way in which people with sight problems are able to get around our towns and cities.

Clause 39 devolves Executive competence in relation to the policing of railways in Scotland by specifying as a cross-border authority the British Transport police authority. The clause is in keeping with the Smith agreement, but it was not part of the agreement that the British Transport police should be devolved in order that it may be abolished. That is what is being proposed by the Scottish Government, who want to transfer the existing functions of the British Transport police to Police Scotland. The abolition is vehemently opposed by the unions and the British Transport police, and their strong views should be taken into account. Will the Secretary of State comment on that issue?

Finally, new clause 63 calls for an assessment by the Low Pay Commission of the effect of the Scottish Parliament having the power to alter the national minimum wage rate for Scotland. The national minimum wage is one of the proudest achievements of the last Labour Government and we will defend it to the death. However, it has become a maximum wage for too many people and we must encourage the private sector to move beyond the minimum wage to a living wage. Low pay is one of the biggest political issues of our time, particularly in the run-up to the Budget, with the proposed cut to tax credits.

[Mr MacNeil]

I am anxious to know why Labour want control over the minimum wage in Scotland to be in the hands of the Tories.

--- Later in debate ---

[Ian Murray]

The minimum wage in Scotland is not in the hands of the Tories; it is in the hands of the Low Pay Commission.

[Mr MacNeil]

It is in the hands of the Tories.

[Ian Murray]

I do not know whether the hon. Gentleman realises this, but it is the Low Pay Commission that recommends the rate of the national minimum wage to the Government. As someone who sat on the Committee that considered the statutory instruments that implemented the recommendations of the Low Pay Commission, I say that I would like its recommendations to go further, but it is up to the commission to set the rates.

I say to the hon. Gentleman that we had a firm manifesto commitment to ask the Low Pay Commission to increase the national minimum wage over a period of time to 58% of median earnings. We have to be careful in this area. That is what new clause 63 is about. If he reads it, he will see that. We have to be extremely cautious about not undermining the national minimum wage by devolving it to Scotland. The new clause is perfectly clear about what we are trying to achieve. It asks the Low Pay Commission to complete a full analysis of the consequences of devolving this power.

If the hon. Gentleman does not believe me, he should look at what we received from the Bakers, Food and Allied Workers Union today. It is promoting a £10 minimum wage, so it has no axe to grind in terms of our policy on 58% of median earnings, because it wants to go much higher. It has been campaigning on that rather successfully for some time. It says that devolving the national minimum wage to Scotland could enable the vision of the Prime Minister’s Government of lower pay in some regions to come true, particularly in northern constituencies and in Scotland. It states:

“We need to be extremely cautious over the…demand for devolving powers surrounding the minimum wage. This move would bring about an end to the national minimum wage”

in Scotland. We are saying that we need to be cautious. I ask the hon. Gentleman to read new clause 63 before he intervenes again. I will allow him to intervene again if he does so.

[Callum McCaig (Aberdeen South) (SNP)]

Low pay is one of the key problems of our age, as has been said. The minimum wage is in need of being undermined because it undermines people’s lives. I would be happy for the Scottish Parliament to increase the minimum wage in Scotland and to fundamentally undermine the minimum wage, so that the embarrassment of poverty wages is eradicated right across the United Kingdom.

[Ian Murray]

That is exactly what we want to see. We want the issue of poor wages across the United Kingdom to be resolved in its entirety. The hon. Gentleman will remember that in 1998, many of my colleagues and former colleagues sat all night for three nights in a row to ensure that the National Minimum Wage Act was passed by this House. It eradicated the worst of low pay in our country, such as security guards being paid 60p an hour. As I said, the national minimum wage has become a maximum wage for too many people and we have to drive it up across the United Kingdom to eradicate poor pay. I caution the hon. Gentleman that there is a danger that we will undermine the national minimum wage across the United Kingdom if we fragment it.

[Mr David Anderson (Blaydon) (Lab)]

As one of the first people to give evidence to the Low Pay Commission in 1998, I think I have some knowledge about this issue. The unions up and down these islands have always said, “Do not vary the rate on a regional or sub-national basis.” There has to be one complete and utter rate across the whole of the United Kingdom, because if there is not, it will open the door for those who want to undermine it, including the people sitting on the Government Benches opposite.

[Ian Murray]

My hon. Friend is absolutely right. There is no bigger champion of workers’ rights, the national minimum wage and union rights in this place. We must deal with poverty pay. [Interruption.] If the hon. Member for Na h-Eileanan an Iar wants to read new clause 63, I am happy to let him intervene again, but he obviously has not because he does not realise that new clause 63—[Interruption.] If he will allow me to explain, new clause 63 asks the Low Pay Commission to do a full analysis of the potential consequences of fragmenting the national minimum wage across the United Kingdom. That is something that Opposition Members of all colours should wish to see, because if we undermine the national minimum wage, we undermine the entire structure that is meant to prevent low pay in this country.

[Mr MacNeil]

It is terrible that Labour sees the national minimum wage only as something to be undermined; it is something that has to be bolstered. What does the hon. Gentleman think the effect would be on the national minimum wage in England, Wales and Northern Ireland if it were increased in Scotland by, say, 10%? It would drive it higher.

[Ian Murray]

In fact, what the hon. Gentleman has just said is exactly what it says in new clause 63, which tells the Low Pay Commission to look at the consequences. The consequence of undermining the political consensus on the national minimum wage would be fragmentation and a race to the bottom. The TUC is clear in its press release today:

“It is also a complete false economy… Breaking up the national minimum wage would carry similar risks, leaving workers in many parts of the country facing poorer pay in depressed local economies.”

It speaks of a potential “race to the bottom”. We should listen to the people who have fought for their entire lives for the national minimum wage. The difference between me and the hon. Gentleman is that he does not agree that everyone across the entire United Kingdom deserves better pay. The fight to eradicate poor pay in this country does not stop at the border.

[Peter Grant (Glenrothes) (SNP)]

Has the hon. Gentleman completely forgotten that some of the biggest advances in progressive social legislation that England has seen in the past 15 years happened after, and only because, they were introduced by the devolved Administrations of Scotland, Wales and Northern Ireland? This place would not have introduced the right to work in a smoke-free environment had it not happened in the devolved Assemblies and Parliaments. The right of responsible access to the countryside happened in the devolved Assemblies, otherwise it would never have happened here. Freedom of information would never have happened here if it had not happened first in the devolved Assemblies.

Does the hon. Gentleman not understand that we need to trust the people of Scotland to elect a Parliament that believes in a legally enforceable living wage? That is the quickest and surest way to make sure that workers across these islands can enjoy a living wage, rather than trusting a Conservative Government to introduce it.

[Ian Murray]

It is clear that the Scottish National party’s strategy is not to have a proper debate and discuss the fundamental points about the risk of undermining the national minimum wage, but merely to paint people as being in the pockets of other Governments or political parties.

The hon. Gentleman is right that many progressive Governments have pushed forward issues such as those he mentioned, but the national minimum wage, freedom of information and the ban on smoking inside were progressive changes pushed through by Labour Governments. The Labour party will fight for the national minimum wage not to be fragmented and undermined in a race to the bottom. The TUC has agreed with that, and the Bakers, Food and Allied Workers Union felt that it had to put out a press release today to ensure that the minimum wage was not undermined. My new clause 63 suggests that the Low Pay Commission looks sensibly at proposals to ensure that that does not happen.

[Chris Stephens]

The hon. Gentleman has mentioned the views of the TUC and the BFAWU. Can he confirm that the two largest trade unions in Scotland, Unison Scotland and Unite Scotland, gave evidence to the Smith commission saying that they wanted responsibility for the national minimum wage to be devolved to the Scottish Parliament?

[Ian Murray]

They have argued that, but the Union of Shop, Distributive and Allied Workers and the GMB have argued that it should not be devolved because they are worried about a race to the bottom. If the hon. Gentleman reads my new clause 63, he will see that I am asking for the Low Pay Commission to look at the issue and ensure that the minimum wage is not undermined. The worst possible result that this Parliament could leave for future generations would be the undermining of the national minimum wage not just in Scotland but across the entire United Kingdom. I hope that the Committee will support the new clause, to ensure that we do not throw the baby out with the bathwater. Let us listen to what the unions and the TUC are telling us. I commend all our amendments and new clauses to the House.

[Several hon. Members]

rose—

Scotland Bill

Ian Murray Excerpts

Monday 15th June 2015 Commons Chamber

[John Redwood]

Then I think we need to have another debate, on another day, which looks at what is going on in these important financial discussions. Although my constituents are interested in what powers Scotland gets, they are far more interested in how the money works between the different parts of the Union. We have no papers before us today to elucidate that.

[Ian Murray (Edinburgh South) (Lab)]

For the second time in five and a bit years, I agree with the right hon. Gentleman. On the complicated nature of the fiscal framework, which I believe he is trying to unpack, does he not agree that the Labour new clause, which will be debated at some point, to set up an independent commission on the costs and implications of full fiscal autonomy provides a much more reasonable and sensible approach?

[John Redwood]

We are where we are. Promises were made, I thought in good faith, by the three Front-Bench teams. They were not my chosen promises; they were made on behalf of the three Unionist parties. They did the job for the referendum, but they then did not do much of a job for the Unionist parties at the general election. However, we cannot now be seen to be delaying for any great length. There needs to be proper work—and I am sure that proper work is going on in the Government at the moment as they try to work out a financial settlement in parallel to this Bill. I am just suggesting that perhaps this Parliament needs to have some of that thinking shared with it.

Today is the first opportunity, within the clear parameters of new clause 3, to try to expose a bit of the thinking on how a limited amount of fiscal autonomy will work, and on how many of these taxes Scotland will not only collect, but be responsible for and have knocked off the block grant. As I remember it, when the leaders came up with this promise, Gordon Brown was a big voice—obviously, he was not one of the leaders at the time—for rather less fiscal autonomy. He was trying to stop Scotland controlling her own income tax revenues, so I do not entirely share the interpretation of the Labour Front-Bench team of what Mr Brown was trying to do at that point.

I will bring my remarks to a close with the simple conclusion that the world has moved on because of the general election result. The debate on money is taking place elsewhere, but we currently have a short debate about money here. I hope that the Front-Bench team will share some of its thoughts on money. Fiscal devolution seems to be attractive to many people in Scotland, but we need to know where it ends and how we sort out all those crucial issues about debt and borrowing as well as about shared policies such as pensions.

--- Later in debate ---

[Stewart Hosie]

I fear that my hon. Friend was intervening less on me than on Conservative Members, but he is absolutely right. There is no argument too odd for them to deploy.

On the opposition to full fiscal autonomy, basing an argument on one or two flawed analyses is using a snapshot in time in order to say no. It is less a case of analysing all the facts to come to a considered view, and more one of finding any reason to oppose for opposition’s sake.

[Ian Murray]

I have tremendous respect for the hon. Gentleman, but he is letting himself down by how he is conducting this debate. If he is saying that the Institute for Fiscal Studies is wrong, why has the same figure come out of the Scottish Government’s own accounts?

[Stewart Hosie]

The chief of the snapshot analyses I have just described is the one from the IFS that our opponents pray in aid. They claimed in April that Scotland would face a relative deficit of £7.6 billion, which may rise to £10 billion by 2019-20, and that in itself is enough for them to say no. I also like and respect the hon. Gentleman—I will not finish the rest of that sentence. I would tell him that his argument is fundamentally flawed. In essence, our opponents’ argument is that even if the IFS figures were true, UK Government economic policy has failed Scotland and we should therefore keep economic policy in the hands of a UK Government who have failed. That simply is not credible.

It is of course true that Scotland has a deficit, and so does the UK—borrowing £75 billion this year, almost four times what the Chancellor promised borrowing would be. The majority of advanced economies run deficits, particularly in difficult times. The UK deficit in 2013-14 was £98 billion. Over the five years to 2013-14, the cumulative deficit was £600 billion. The UK was in deficit for 43 of the past 50 years, and 28 of the 34 members of the OECD were in deficit in 2013. If the deficit alone was a reason for a country to surrender its financial independence, the UK economy would be run from Berlin.

--- Later in debate ---

[Stewart Hosie]

That is absolutely right. Trend growth in the UK over decades has not been sufficient, and private sector investment and innovation have been lamentable. My hon. Friend is absolutely right that we need these powers for a reason.

Notwithstanding what has been said, it is important to remember that Scotland is a prosperous economy. It is about far more than oil, although to listen to some of our political opponents, one would think that that was all the Scottish economy consisted of.

[Ian Murray]

Will the hon. Gentleman enlighten the Committee about what level of economic growth he thinks Scotland would require to balance the budget?

[Stewart Hosie]

We need to get trend growth up and we need to operate within a framework that will see the deficit begin to come down. I do not remember the previous Labour Opposition ever coming up with a cast-iron figure—2.75%, 3%, 3.25%, 4% or 5%—for trend growth. No one would be so silly as to put a figure on it, when it is dependent on so many external criteria.

Our political opponents dismiss the Scottish economy, saying that it is all about oil. They seem to forget that in two of the past four years our deficit was smaller than that of the UK. In the past 34 years, tax revenue per person has been higher than in the UK. Indeed, in the last full year, including our geographic share of the North sea, it was more than £10,000 per head compared with £9,700 in the UK. Even without North sea oil, output per head is almost identical to the UK. We remain the third most prosperous and productive of the 12 so-called regions of the UK, and, including a geographic share of oil and gas, our output per head is higher than the UK average, even today.

--- Later in debate ---

[Ian Murray]

The hon. Gentleman is being incredibly generous with his time. Will he tell the Committee why, if full fiscal autonomy is so good for the Scottish budget, he will not support new clause 3, tabled by the hon. Member for Gainsborough (Sir Edward Leigh)?

[Stewart Hosie]

I want maximum power for Scotland. I want it as quickly as possible. I am not like the British Labour party, which keeps saying no and, in the absence of no, says delay with yet another commission. If the hon. Member for Gainsborough (Sir Edward Leigh) presses new clause 3 to a vote, we will support it. Here is the thing: I hope the hon. Member for Edinburgh South (Ian Murray), who is grinning like a Cheshire cat, will now get to his feet and tell us whether he intends to back the Government tonight in opposing powers for Scotland. The silence is deafening.

Let me continue with more of the arguments our opponents deploy against full fiscal autonomy. When they argue against more powers they say that they would require further cuts, but that argument is completely flawed. It would suggest that the Scottish Government are protected from Westminster cuts at present, which simply is not true. Cuts in the previous Parliament actually took place at a time of rising North sea revenues.

--- Later in debate ---

[Tommy Sheppard]

I am a Derry man as it happens. If the hon. Gentleman wants to make a point of such substance, perhaps he should indicate to the Chair and take part in the debate. What we are talking about is a matter of political principle. It is about the direction in which we want to go forward. It is entirely possible, with good will, to put in place proper fiscal arrangements.

I wish to turn to the amendment of the hon. Member for Gainsborough (Sir Edward Leigh). I have not been in this job long—

[Ian Murray]

rose—

[Tommy Sheppard]

May I deal with this point, and then take an intervention? I have not been in this job long, but I am surprised—I expect I will be surprised by various things over the next five years—to find such a passionate and eloquent exposition from the Conservative Back Benches of a position with which I agree. I suspect that there is little else on which the hon. Gentleman and I would agree. On this point, he makes his case very well. However, I wonder whether there is an element of mischief at the back of his mind. Perhaps he believed the propaganda from his own Front Bench several weeks ago that we were weakening in our commitment to full financial autonomy, and he thought that he might embarrass us in this debate today. I must reassure him that we are not lukewarm and our commitment is not weakening. In fact, we like the idea so much we have brought our own amendment before the Committee. I am intrigued at the suggestion that all we need to do is vote for it—

--- Later in debate ---

[Tommy Sheppard]

If the new clause is moved, the hon. Gentleman will see me there, for sure. I hope that I will see him in the Lobby to vote on our amendment.

The interesting thing about the debate so far is that the case has not been made against full fiscal—

[Ian Murray]

rose—

[Tommy Sheppard]

Is this perhaps on the subject of the hon. Gentleman’s misrepresentation of my views?

[Ian Murray]

I am grateful to the hon. Gentleman, who has just confirmed that he will walk through the Lobby with the hon. Member for Gainsborough (Sir Edward Leigh). He said on the radio—I was on with him—that the delivery of full fiscal autonomy for Scotland would be utterly devastating. Does he stand by those comments?

[Tommy Sheppard]

The hon. Gentleman must apologise for misquoting me. I said—[Interruption.] Yes, I have the transcript as well as the hon. Gentleman. I said in the context of a debate that if this was done wrongly it would be possible to get it wrong. To my mind, that is a tautology: if we do not do something right, we get it wrong. The hon. Gentleman then decided that that somehow meant that I was against the whole principle of full financial autonomy and took to the Twittersphere to promote that. It does not, I am not and the fact that he had to do that shows the paucity of the arguments against our proposals.

We have yet to hear the argument against full financial autonomy for the Scottish Government, and I hope that we shall before the debate concludes. We have heard talk of a black hole, which other people will regard as a deficit when in fact it pertains to all economies at this point in time. We have heard that a policy of principle should be based on a snapshot from one point of time in an academic survey of what might happen in a year that will not even be covered by the process. That has somehow been extrapolated into an argument of principle against the proposal. It is not. If it was, would that mean that if there was not a deficit but a surplus in the Scottish budget, as there has been on many occasions, the policy would be flipped again and autonomy would suddenly become okay? We need to hear the arguments of principle against the proposal.

The difference between us is that, although there is a deficit in the Scottish budget, the SNP believes that it is possible for Scotland to prosper if it has control of its own resources, if it can manage its own economy, if it can grow its own revenue base and if it can steward its own budgets properly. Full financial autonomy would mean that the people of Scotland could get the benefits of that economic growth. That seems a laudable objective.

[Tommy Sheppard]

I am sorry, but I am just coming to the end of my speech.

My hon. Friend the Member for Dundee East (Stewart Hosie) has given some clear examples of how economic powers could be deployed. If Members, many of whom are on the Labour Benches although some might be on the Government Benches, are against that in principle, they need to tell us. If they are against it just because of the economics that might pertain to it, it is entirely possible to make an argument about equalisation measures and other mechanisms that could be introduced if we wanted it to happen. They need to tell us why on principle they do not want it to happen. I hope that we will hear that before the night is out, but in the meantime I commend the amendments to the Committee.

[Ian Murray]

May I personally congratulate the hon. Member for Edinburgh East (Tommy Sheppard) on his stunning victory at the general election? I miss my colleague, Sheila Gilmore, whom I wish well, but I congratulate him.

It is a great pleasure to speak in support of our amendments. I could not help noticing that Lionel Richie was in the Gallery earlier, and I hope he enjoyed the first part of our debate as much as we enjoy his music.

These days in Committee are important in ensuring that the Smith agreement is delivered in full in both spirit and substance, as we said consistently on Second Reading. It is also essential to ensure that we go further than the Smith agreement, as Labour has said time after time, and we have set out a number of clear improvements.

Scotland has had an in-depth and passionate debate about its future and concluded that a fair and more prosperous Scotland is best delivered by shared tax and spending across the UK, with Scotland taking more control over the levels of tax and spending alongside greater accountability. I agree with the hon. Member for Perth and North Perthshire (Pete Wishart) that if anyone is under any illusion that the centre of political gravity in Scotland is not at Holyrood, they have not grasped the modern political landscape in Scotland. That is why the clauses and amendments recognise the Scottish Parliament as the seat of political power and the catalyst for change in Scotland. Our amendments attempt to deliver that change. This is a great responsibility on us all, but in the end it is much more important that we debate how powers are used than where they lie. We have tried to tease out some of those issues in interventions today, but without much success.

--- Later in debate ---

[Mr MacNeil]

At the time of the referendum, the yes side included full fiscal autonomy in its proposals. After the vow, the no side also included full fiscal autonomy. What has changed since the referendum that has made the no side resile from that? The vow was as near to federalism as possible, and it would have included full fiscal autonomy. Why does the hon. Gentleman now want to leave those powers in the hands of the Tories at Westminster rather than with the Parliament of the Scots in Edinburgh?

[Ian Murray]

There is a very simple answer to that question. We all want what is best for Scotland. The latter part of my speech sets out how full fiscal autonomy would be bad for Scotland according to all the information we have. We can either have a sensible debate in this Chamber about our fundamental principles on people’s lives and livelihoods in Scotland, or we can have a political knockabout on who will vote with who, who prefers who and who said what to whom during the referendum debate. The Bill is critical to future livelihoods in Scotland, and if all we can get from those on the SNP Benches is simple party point scoring we will get no further forward in improving the Bill.

To answer the question asked by the hon. Member for Na h-Eileanan an Iar (Mr MacNeil), we are here today because the vow put together the Smith agreement. The five political parties, including the SNP, which was represented on the commission, have come forward with proposals that are now in the Bill. Labour wants to take the Bill a little further. I keep emphasising that and I emphasised it consistently on Second Reading.

[Ian Blackford]

rose—

[Ian Murray]

I am going to make a little progress, but I will come back to the hon. Gentleman if he wants to intervene a little later.

As Labour said at the time of the referendum, and as we have said many times since, the no vote was not a vote for no change. Labour played an active part in the Smith commission, the recommendations of which bring us to where we stand today, considering the Bill. It was a compromise position and with all good compromises there will be some gains and some losses. I hope and believe that the Bill will strike the right balance, affording the Scottish Parliament the power to make a real difference to people’s lives while ensuring that Scotland remains part of and secure in the United Kingdom.

[Mr MacNeil]

Will the hon. Gentleman give way?

[Ian Murray]

I will give way to the hon. Member for Ross, Skye and Lochaber (Ian Blackford), who got in before the hon. Member for Na h-Eileanan an Iar.

[Ian Blackford]

Will the hon. Gentleman not accept that the Scottish people voted overwhelmingly for the Scottish National party in the general election on 7 May? Fifty-six Members of Parliament were sent to this Chamber with the express view of the Scottish people that we want home rule—the home rule that Gordon Brown talked about before the referendum. Why does the hon. Gentleman not accept that Labour lost the general election in Scotland because it was out of tune with the Scottish people? It is about time it started to listen to what the people of Scotland want and to deliver it.

[Ian Murray]

It seems to me that the SNP, in its fantastic victory, on which I have congratulated and complimented its Members on a number of occasions from this Dispatch Box, does not want any scrutiny at all. Just because the SNP has made a proposal for full fiscal autonomy does not mean that we should not scrutinise that proposal. In fact, if it was not for the hon. Member for Gainsborough (Sir Edward Leigh), we probably would not even be discussing full fiscal autonomy today. He forced the hand of the Scottish National party so that it brought forward its manifesto commitment, which it was rowing back on incredibly quickly.

[Stewart Hosie]

Will the hon. Gentleman give way?

[Ian Murray]

Let me make a little progress and then I will give way, as the hon. Gentleman was generous in giving way to me.

In the past couple of years it has become increasingly apparent that devolution is a matter not just for Scotland, Wales and Northern Ireland, but for England and the United Kingdom as a whole. The Labour movement has always been an engine of reform and the party of devolution. People want to see power devolved and exercised at local level, affording greater decision making and enhanced accountability.

[Patricia Gibson]

Will the hon. Gentleman give way?

[Ian Murray]

I will give way, but let me make a little progress first as people want to speak on other amendments.

If those ambitions are to be realised, we need to depart from the divisive rhetoric employed during the general election campaign, which set Scots against the English and against one another and risks tearing the UK apart at the seams. Labour believes in the historic Union of the UK nations working together for the common good. However, it is clear that the Union now needs to evolve, and that evolution means dispersing power from the centre, from Whitehall and from this Parliament. With devolution to Scotland, Wales and Northern Ireland continuing apace, this evolutionary process is in danger of becoming lopsided.

That is why, had Labour won in May, we would immediately have started to devolve power away from Whitehall not just to Scotland, Wales and Northern Ireland, but to the regions and localities across the United Kingdom. That is because we recognise that regions can and must be given more of a voice in our political process, and that we must find new ways to give further voice to regional and national culture and identity, and crucially without the strings that this Government have attached.

[Stewart McDonald]

I am grateful to the hon. Gentleman for giving way and I apologise to my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) for intervening first. The hon. Gentleman makes an important point about taking power out of the hands of this place and of the Scottish Parliament and giving it to local communities. Others on the Labour Benches have made the same point. Why then did Labour-controlled Glasgow city council continue to act as a roadblock against our legislation in the Scottish Parliament? I see him rolling his eyes and chuntering to his mate beside him. Why is Labour against our Bill in the Scottish Parliament to give power to local communities through the Scottish Parliament? Why is Labour such a roadblock in Glasgow?

[Ian Murray]

I am not sure of the entire detail of the proposal that the hon. Gentleman refers to, but there is a general consensus across Scotland that the Scottish Parliament has been one of the most centralist Parliaments in the world by grappling power away from local government. What we are trying to do as part of this Bill, which I think is a major positive, and I hope the Government—

[Stewart Hosie]

Will the hon. Gentleman give way?

[Ian Murray]

Will the hon. Gentleman allow me to answer the previous intervention first? He is a seasoned professional in this Chamber, so he should allow me to get at least halfway through the response to his hon. Friend’s intervention.

One of the key questions—I hope the Secretary of State and those on the Treasury Bench look at some of these principles in the context of the Bill—is whether those principles go further towards double devolution. There is no point in sending powers from one Parliament to another. [Hon. Members: “Give way!”] Those powers also have to be spread across Scotland from Holyrood to local authorities. Without that process, hon. Members cannot take power closer to the people they seek to represent.

I will give way to the hon. Member for Dundee East (Stewart Hosie) and then to the hon. Member for North Ayrshire and Arran (Patricia Gibson). [Interruption.] The hon. Lady can blame her boss if she likes; he wants to come in first.

[Stewart Hosie]

The hon. Gentleman suggested about 10 minutes ago that the Scottish National party was not going to table an amendment to deliver full fiscal autonomy, and he suggested that it happened only because of the amendment tabled by the hon. Member for Gainsborough (Sir Edward Leigh). That is completely false. Amendment 89 is on the amendment paper to deliver full fiscal autonomy. Will the hon. Gentleman withdraw that daft allegation from the Labour Front Bench and, more importantly, confirm that Labour Members intend to go through the Lobby with members of the Tory Front-Bench team to stop power coming to Scotland?

--- Later in debate ---

[Ian Murray]

It is wonderful. We are now being accused of voting not with the Tories, but with the Tory Front Bench, while SNP Members troop through the Lobby with the most right-wing Conservatives. It is incredible. The hon. Gentleman is not listening to the answer, although he insisted on the intervention. If he was so keen on full fiscal autonomy before he tabled amendment 89, he could have just signed new clause 3, tabled by the hon. Member for Gainsborough.

[Sir Edward Leigh]

My amendment gives what SNP Members say they want straight away, whereas their amendment is a bit of a fudge and slightly kicks the matter into the long grass. It is a bit like St Augustine saying, “Let me stop sinning, but not quite yet.”

[Ian Murray]

The SNP position can be summed up with the words, “What do we want? Full fiscal autonomy. When do we want it? We’re not quite sure.”

[Patricia Gibson]

Does the hon. Gentleman agree that the powers proposed in the Smith commission report and in the Bill are utterly inadequate? By way of illustration, the powers of the Scottish Parliament are so feeble that it cannot even ban parking on pavements, such is its lack of teeth. Further, does the hon. Gentleman agree that all power should be devolved to Scotland unless there is a compelling reason to reserve that power at Westminster?

[Ian Murray]

The hon. Lady is right: there is a deficiency in respect of parking on pavements and all hon. Members have been lobbied about trying to change that in the Bill. We will table amendments, which she is welcome to sign.

[Patricia Gibson]

rose—

[Ian Murray]

Let me give this commitment: if the hon. Lady brings forward an amendment on parking on pavements, we will sign it.

Let me explain why we tabled new clause 2 in terms of the constitutional convention and the practical steps we need to take so that, where appropriate and desirable, decisions are taken as close to communities as possible. Our new clause proposes that members of the constitutional convention must include members of the public, which is the key part of any constitutional convention, elected representatives across all levels of government, including this place and local government, representatives of civic society organisations and, in an advisory role, academia. What we cannot have is a Prime Minister and Government cooking up a devolution settlement in a back room of the Cabinet Office without proper recourse to the public. As I said on Second Reading, the Prime Minister’s cack-handed approach to the way he dealt with the post-Scottish referendum landscape has in itself threatened the very viability of the UK that Scots voted to maintain.

Let us have a wide-ranging discussion on the constitutional settlement of the whole of the UK. The recommendations by the constitutional committee would include, but not be restricted to, matters that we have already discussed today—the role and voting rights of Members in this Chamber, democratic reform of the House of Lords, further sub-national devolution to England, Wales, Northern Ireland and Scotland, votes at 16 and codification of the constitution, the absence of a proper written constitution being one of the problems we have when discussing the Bill.

Our amendment 37 and 38 are very similar in substance to those tabled by the right hon. Member for Orkney and Shetland (Mr Carmichael). The opening lines of the vow declared that

“The Scottish parliament is permanent and extensive new powers of the Parliament will be delivered”.

Equally, the Smith commission agreement said that

“UK legislation will state that the Scottish Parliament and the Scottish Government are permanent institutions”.

As I have said, the centre of political power in Scotland is the Scottish Parliament. It has powers over most things that affect the day-to-day lives of most Scots, but as things stand and as was noted by the Political and Constitutional Reform Committee, the Scotland Act 1998 stated:

“There shall be a Scottish Parliament”,

but did not provide that it be permanent, nor does it set out any special procedures or grounds on which it could be dissolved. Would there be a simple repeal of the Scotland Act?

There has been agreement among legal experts that the clause could be made clearer, more concise and more in keeping with the overall spirit and tenor of the Smith recommendations. For example, the Law Society of Scotland—I thank it and particularly Michael Clancy for all his advice on the legalities of these clauses—stated:

“The phrasing in the draft clause does not literally implement the terms of Paragraph 21 of the Smith Report. The use of the phrase ‘recognised as’ permanent has a different nuance from a statement that the Scottish Parliament and the Scottish Government are permanent institutions.”

[Patrick Grady (Glasgow North) (SNP)]

Given that the Scottish Parliament, at the insistence of the Labour party, was founded through the process of a referendum, will the hon. Gentleman support our clause to ensure that it cannot be abolished without a referendum?

[Ian Murray]

I am delighted that the hon. Gentleman has raised that point. That is exactly what our amendment does as well. We are very happy for SNP Members to sign our amendment, given that ours was tabled before theirs. We agree on this; there is no division on this. We need a robust devolution architecture. That means making sure that the legal restrictions in the Bill are removed so that we have a permanent Scottish Parliament in statute as well as in spirit.

Amendment 16 would alter clause 1 by exchanging the indefinite article for the definite article in reference to the Scottish Parliament. There is only one Scottish Parliament, after all, so there is no need for a double reference. Amendment 38 would add to clause 1 the stipulation that the Scottish Parliament and the Act on which it is predicated can be abrogated only with the consent of the Scottish people given effect by an Act of the Scottish Parliament. That is the referendum section of our amendment. I believe that amounts to what is known in constitutional law as contingent entrenchment. Given the limited time available, I will not go through the other issues relating to contingent entrenchment, but I am sure that the Secretary of State realises the desire of all three opposition parties to strengthen clause 1 and include a referendum requirement so that permanency is determined by the Scottish people. Amendments 58 and 59 make similar proposals.

--- Later in debate ---

[Ian Paisley]

At the end of this debate, has the shadow Secretary of State any inkling whatsoever of when the Barnett formula calculations for Scotland would cease and what impact that would have on the rest of the United Kingdom?

[Ian Murray]

The Barnett formula would cease as soon as the powers for full fiscal autonomy were transferred. That is something everyone should be aware of. The hon. Gentleman has consistently challenged SNP Members to say what the cost of full fiscal autonomy would be for the ordinary Scottish person in the street, and we are yet to have an answer. We have been told, “Let’s get the principle of full fiscal autonomy together and then work out the consequences later.”

[Several hon. Members]

rose—

[Ian Murray]

I will give way again, but first let me make some progress.

It is simple: the pooling and sharing of resources across the UK, and the maintenance of the Barnett formula, benefits Scotland. The much-quoted Institute for Fiscal Studies, which the SNP continually rubbishes, has demonstrated beyond argument that full fiscal autonomy would result in Scotland having a deficit of some £7.6 billion. Before SNP Members jump up to challenge those expert figures, I want to put it on the record that that is over and above any current UK deficit and UK spending projections.

[Joanna Cherry (Edinburgh South West) (SNP)]

Does the hon. Gentleman agree that all this talk of black holes with full fiscal autonomy fails to recognise that a black hole exists already as a result of the policies of successive Westminster Governments, both Tory and Labour, and for which the Tories are now making the poorest and most vulnerable in our society pay? [Hon. Members: “Speech.”] The case that Labour is making in attacking full fiscal autonomy is that things are so bad that letting the Tories fix the deficit their way is better—[Interruption.] I am going to keep going—[Interruption.]

[Joanna Cherry]

Does the hon. Gentleman agree that his party should have more ambition for Scotland?

[Ian Murray]

This is the nub of the matter: if we try to scrutinise what would be a devastating policy for Scotland, we are accused of not being ambitious for Scotland. For the avoidance of doubt, that £7.6 billion is over and above the UK deficit. I agree with the hon. Lady that the Conservative Government made a complete shambles of getting rid of the deficit in the previous Parliament, breaking all their promises and only halving it. But the actual deficit—I have the IFS paper here—is not just £7.6 billion, but £7.6 billion over and above the current UK deficit, which is £14.2 billion. That is not a lack of ambition for Scotland, but a warning against a fiscal policy that would be folly for families up and down Scotland.

[Mr MacNeil]

rose—

[Ian Murray]

I will give way to the hon. Gentleman, before he bursts a blood vessel.

[Mr MacNeil]

It is now clear that the policy of Labour’s Front Benchers is to leave Scotland’s tax powers in the hands of this Tory Government. The vow did not say that; the vow included full fiscal autonomy. Will the hon. Gentleman tell us when he changed his mind?

[Ian Murray]

The Bill before us will transfer nearly 50% of tax and 60% of spending to the Scottish Parliament. We promised to make it the most powerful devolved Parliament in the world, and that is a promise we will keep. As I have always said, we will ensure that the Bill is delivered in full, both in spirit and in substance. We will go further, as we will debate in Committee in due course.

Let me return to the £7.6 billion deficit—[Interruption.] I know that SNP Members do not like to talk about the £7.6 billion deficit, but it is important to get it on the record. It is unfortunate that they have consistently misquoted the figures from the Institute for Fiscal Studies, and indeed it has had to ask them to retract what they have said about its figures.

We have also heard no mention of the Office for Budget Responsibility’s oil report, which was published last week. It showed that the reliance on oil as an underpinning of the Scottish economy is no longer a viable projection. The collapse of revenues from oil will see the tax take from that source drop from £37 billion to just £2 billion over the 20-year period to 2040. That would be catastrophic for Scottish public finances. The question, then, is this: will SNP Members vote with the Tories to deliver what they want, as they have said they will do, or will they finally admit that their flagship policy of full fiscal autonomy is economically illiterate?

[Stewart Hosie]

rose—

[Ian Murray]

And there is no better time to go to the hon. Member for Dundee East.

[Stewart Hosie]

The hon. Gentleman is extremely generous. He mentioned the OBR. He will want to confirm, for the sake of completeness, that the OBR itself has said that the forecasts were very uncertain, even over the short term. It implies 8 billion barrels of oil extracted, rather than the normal industry 14 billion to 24 billion, and of course the figures it uses are contradicted by other expert groups that have higher prices and higher forecast extraction figures.

[Ian Murray]

Well, the hon. Gentleman is wasted in this House; he should be in the City, buying and selling futures in oil price shares. I think that is the best way for him to go. The three points that fall from the OBR report are the unpredictability of the oil price, the difficulty of extraction in the North sea and the fact that, whatever way we look at it, oil revenues will be declining sharply over the next 20-year period. It would appear that the hon. Gentleman—[Interruption.] I am happy to take other interventions, but it is quite clear that SNP Members cannot defend their policy for full fiscal autonomy. Indeed, they should listen to their hon. Friend, the hon. Member for East Lothian (George Kerevan), who said that it would be economic suicide. He is an experienced journalist and economist, so they would do well to listen to him.

In conclusion, we will push amendment 38 to the vote because we feel that the permanency of the Scottish Parliament should have the underpinning of the Scottish people by any means that would be appropriate, including a referendum. We will push to a vote new clause 2, which proposes a constitutional convention to resolve some of the larger issues on a constitutional settlement across the country. We will oppose full fiscal autonomy in all its forms, because it would be bad for the Scottish people, bad for the Scottish economy and bad for the future of Scotland.

[David Mundell]

Today is the first of four days in Committee on the Scotland Bill. I assure the hon. Member for Edinburgh East (Tommy Sheppard), whose contribution I enjoyed, that I will be listening and reflecting. Contrary to the suggestion made by the hon. Member for Perth and North Perthshire (Pete Wishart), this is not the only opportunity for changes to be made to the Bill. I will be meeting the Devolution (Further Powers) Committee of the Scottish Parliament next week to discuss points that it has raised in its report.

I would not normally begin a contribution by suggesting that anyone read one of Gordon Brown’s books, but tonight I will do so. Gordon Brown has been misquoted a number of times in the Chamber today, and it is important to put on the record the fact that in his book “My Scotland, Our Britain: A Future Worth Sharing”, he states that neither his proposals nor those of any of the pro-UK parties involved a federal solution. Although they came close to the idea of home rule, they were not home rule. Therefore, it is a myth, which has been perpetuated this evening, that Gordon Brown has called for either federalism or home rule.

--- Later in debate ---

[The Parliamentary Secretary, Cabinet Office (John Penrose)]

I thank the hon. Members for Moray (Angus Robertson), for Nottingham North (Mr Allen), and for Caerphilly (Wayne David) for their contributions to the debate on this group of amendments on the significant electoral powers that will be transferred to the Scottish Parliament and Scottish Government. I hope to respond to as many points as I can, but first let me deal with a number of minor and technical Government amendments before I get on to the meat of the points that have been made during the debate.

Government amendments 93, 94 and 97 amend and clarify the reserved undevolved powers in clause 3 in respect of enforcement provisions within the Political Parties, Elections and Referendums Act 2000 where they apply to other provisions that are also reserved. Government amendments 95 and 96 remove sections that do not need to be reserved in the 2000 Act as well. Amendments 106 and 107 are minor and technical amendments. Amendment 106 repeals the subsections inserted into the Scotland Act 1998 by section 13 of the Scotland Act 2012. Clause 11 brings the function of making an Order in Council under sections 15(1) and (2) of the 1998 Act within devolved competence and those subsections are therefore no longer required. Amendment 107 repeals section 13 of the Scotland Act 2012 entirely.

Amendment 101 relates to clause 5, which concerns the timing of Scottish parliamentary elections and local government elections in Scotland. It will ensure that general elections for the Scottish Parliament cannot be held on the same day as general elections to the UK Parliament or to the European Parliament or a local government election in Scotland. That is in line with the Smith commission agreement, as we heard from the hon. Member for Moray.

I hope that the hon. Gentleman will be pleased to hear that the purpose of amendment 101 is to remove the provision from the clause that says that a general election to the Scottish Parliament cannot be held in the two months preceding a general election to the UK Parliament or a general election to the European Parliament. That brings us more closely in line with the Smith commission, and is, I hope, an example of cross-party working.

Amendments 92 and 98 are also minor and technical. The purpose of amendment 92 is to protect the individual electoral registration digital service from future technical changes, such as the transfer of functions between UK Ministers. Effectively, it is nothing more than a future-proofing move. If amendment 92 were not made, the effect may be to place an unintentional constraint on the future actions of both the UK and Scottish Governments. The amendment should protect against the potential need to amend the Act as the registration of electors and verification of applications to register via a digital service evolves.

Amendment 92 means that the definition of “digital service” and of “elections in Scotland” in clause 3 is no longer required. Amendment 98 therefore removes those definitions. It does not make the reservation any wider but gives additional clarity over what is to remain reserved—I am talking about the digital service itself but not the powers that have been devolved to the Scottish Parliament.

Amendments 99 and 100 are again minor and technical. Their purpose is to reflect the changes made to the reservation of the IER digital service in clause 3 by amendment 92. Amendment 99 ensures that subsection (4) of new section 12 of the Scotland Act 1998 refers to the amended reservation of the digital service in clause 3—I trust that everybody is taking notes and following closely. Amendment 100 removes the now unnecessary definition of the digital service in clause 4, again as a result of the amended reservation of the digital service in clause 3.

Amendments 102 to 105 are technical amendments that reflect the changes made to the reservation of the IER digital service in clause 3 by amendment 92. Amendment 102 ensures that the regulation-making power of Scottish Ministers in this provision refers to the amended reservation of the digital service in clause 3. Amendment 103 removes the definitions of “the digital service” and “the use of the digital service” from the clause, as they are no longer technically required. Amendment 104 ensures that clause 6 refers to the amended reservation of the digital service, as made by the amendment to clause 3. Finally, amendment 105 removes the definitions of “the digital service” and “elections in Scotland” that are also no longer required as a result of that further amendment.

Let me turn to the other amendments that are part of this wider group. I will start with amendment 42 and the elements of amendments 60 and 61 that relate to clauses 3 and 5 and the continued reservation of certain combinations of polls. The clauses fulfil the Smith commission agreement devolving significant electoral powers to the Scottish Parliament while ensuring that polls for Scottish parliamentary general elections will not be held on the same day as UK parliamentary general elections, European parliamentary general elections or ordinary local government elections in Scotland, which have already been devolved.

[Ian Murray]

Will the Minister explain why the entirety of the administration of Scottish parliamentary and local government elections is devolved to the Scottish Parliament while the UK Parliament reserves the right not to have Scottish parliamentary and local government elections on the same day? Why not devolve them all to allow the Scottish Parliament to make that decision?

[John Penrose]

That is a question I asked myself a short while ago. The reason is very straightforward. Although the two powers are devolved, as the hon. Gentleman rightly points out, changing the rules surrounding them and on whether or not they can happen on the same day is a reserved power. As that is a reserved power, it makes sense to keep any potential combination of elections as a reserved power for the time being, as the two powers match up. Were it to be within the competence of the Scottish Parliament to vary that, it would make sense for the Scottish Government to have the power to adjust the combination rules. As it is, the two match up closely.

--- Later in debate ---

[Dr Coffey]

To be clear, that is what was agreed in the Smith commission. The right hon. Gentleman’s party agreed to it and we are not planning to go beyond the Smith commission on this particular arrangement.

[Ian Murray]

I did not want the moment to pass without congratulating the hon. Lady on her first time at the Dispatch Box and saying that we are delighted to see her.

[Dr Coffey]

Well, that is very sweet. The hon. Gentleman and I, in our very first summer here together as Members of Parliament, had the joy of going to the United States of America to participate in the British-American parliamentary group. We have been firm friends since. [Hon. Members: “Ooh!”] Exactly—what goes on in Vegas, stays in Vegas.

Clause 10 implements paragraph 27 of the Smith commission agreement, which identified that it is important to have an adequate check on certain types of Scottish Parliament electoral legislation. The Smith commission recommended that UK legislation should provide that such legislation is passed by a two-thirds majority of the Scottish Parliament. The Government agree that this provides an important safeguard. It is possible, of course, that there may be discussions on whether a particular Bill is in fact this type of legislation.

Clause 10 also allows the Advocate General, the Lord Advocate or the Attorney General to refer to the Supreme Court the question of whether a certain piece of legislation requires a two-thirds majority of the Scottish Parliament. The Supreme Court already provides a similar role on whether a particular matter is within the legislative competence of the Scottish Parliament, so I will move that clause 10 stand part of the Bill.

Amendments 67 to 88 concern clause 11, which delivers on the Smith commission recommendation to give the Scottish Parliament greater powers in relation to the arrangements and operation of the Scottish Parliament and the Scottish Government. It does this by enabling the Scottish Parliament to modify relevant sections of the Scotland Act 1998. I am sure that the Secretary of State will wish to reflect on this to ensure that the agreed powers work correctly, but the Government are clear that the substantial new powers devolved under clause 11 are the right ones.

A number of the amendments to clause 11 would allow further modification of the 1998 Act beyond the scope of the transfer of powers envisaged by the Smith commission. The Bill already transfers substantial powers to modify the Act, consistent with the commission, and the Government do not believe it is right to go beyond that.

The hon. and learned Member for Edinburgh South West referred in particular to amendment 67. Indeed, the right hon. Member for Orkney and Shetland said that this matter should be consistent across the UK, reinforcing that this is a reserved for the UK Parliament and not a devolved matter. The hon. and learned Lady said that the UK Government had not been clear on some aspects of this matter. I believe that the Prime Minister has been clear at this Dispatch Box. Amendment 67 would amend the Bill such that paragraph 1 of schedule 4 to the 1998 Act would be modified to remove the Human Rights Act 1998 from the list of legislation the Scottish Parliament cannot modify, otherwise known as the “protected enactments”.

The Committee will be aware that the Government outlined their proposal to reform and modernise our human rights framework by replacing the Human Rights Act with a Bill of Rights. That was reinforced today by my right hon. Friend the Prime Minister at the celebration of the 800th anniversary of Magna Carta. Of course, we are aware of the possible devolution implications of reform and we can engage with the devolved Administrations as we develop the proposals. As the Secretary of State said, the Sewel convention, as intended by Lord Sewel, has been placed in the Bill, but this Parliament remains sovereign. The Government are certainly committed to human rights and, as I indicated earlier, we will consider the devolution implications.

Scotland Bill

Ian Murray Excerpts

Monday 8th June 2015 Commons Chamber

[Ian Murray (Edinburgh South) (Lab)]

May I start by offering my congratulations to you, Mr Speaker? This is the first time I have been at the Dispatch Box since you were elected as Speaker. It is a tremendous pleasure to see you back in the Chair, especially after the events on the last day of the last Parliament.

I also congratulate the right hon. Gentleman the new Secretary of State, and not on his Castroesque speech—he spoke for nearly an hour—but because he has always been helpful, courteous and kind. I hope we will continue in that spirit now he is Secretary of State. The House may not know this, but we share something in common. We both share the distinction of being the most difficult choices that our party leaders had when choosing someone for our respective roles. I hear the Prime Minister mulled over the list of potential candidates for Secretary of State for hours before deciding on the right hon. Gentleman, but I am sure he will be a wise choice.

It would be remiss of me not to extend my congratulations to the Scottish National party Members on their unprecedented result in Scotland. There is a heavy weight on their shoulders—by the looks of it, on the end of their third Bench as well—to deliver the considerable promises that they made to the Scottish people during the election campaign. I say this sincerely to them: the political enemy in this place is on the Government Benches, and I hope that they will remember that in the coming years. Where we agree, I will endeavour to work with them and I hope that they will reciprocate; where we do not, and where scrutiny and principled opposition are required to hold the SNP Government to account in Holyrood, I will be a strong voice in such scrutiny. [Interruption.] The hon. Member for Perth and North Perthshire (Pete Wishart), who is chuntering from a sedentary position, does not seem to be starting off on the right footing.

I want to pay tribute to my many colleagues and friends who lost their seats in Scotland at the general election. They should all be thanked for their unstinting commitment to serving their constituents; they will be a big loss to this place and I wish them all well. No one epitomised that dedication to public service more than my predecessor as the Opposition’s spokesman, Margaret Curran. She worked day and night in this place and beyond to stand up for the interests of Scotland and her constituents. We all owe her a debt of gratitude for that strong voice and for the position we are in today with the Bill.

Today marks a momentous point in Scotland’s devolution journey. Whatever the outcome of the general election, the Bill would have been in the first Queen’s Speech, regardless of who was sitting on the Treasury Bench. In 1997 one of the first acts of the new Labour Government was to present a Bill to the House to deliver the referendum that gave us the Scottish Parliament. That was a promise made then and kept then; we should bear that in mind when debating the Bill today. The Labour party is and always will be the party of devolution.

“There will be a Scottish Parliament”—the words of the father of Scotland, Donald Dewar. When he uttered those words, however, it signified a journey in devolution. That journey has seen Scotland recently travel through an extraordinary democratic process. The referendum was a once in a generation—once in a lifetime, depending on who is speaking—experience, marking a defining choice about Scotland’s membership of the United Kingdom. It was a no vote, but it was not a vote for no change. We can draw a constitutional lesson from that: Scotland wants to be in the United Kingdom, but it wants to be unique and able to make its own political choices.

Labour argued passionately for Scotland to remain in the UK and we won the argument. Perhaps we sacrificed our own party’s interests in doing so, but it was certainly the right thing to do. It is important to understand what the agreement was, why Scots chose to stay in the UK and why it is so important for the Bill to deliver for Scotland. It is therefore worth putting the Bill in its constitutional context.

Over the past year we have had a debate about Scotland’s place in the world and how, in an uncertain international environment, Scotland’s interests are best served as part of a larger country and stable Union; a debate about Scotland’s economic interests, with more opportunities for jobs, for businesses and for investment as part of the wider UK; a debate about sharing economic and financial crisis risks, whether in the rebuilding of the Scottish-domiciled banks or the shared risks from the ups and downs in the oil price; a debate about shared tax and spending resources, about how Scotland can take greater control over tax and spending while maintaining the UK-wide pooling and sharing of resources that guarantees pensions and benefits, and safeguards Scotland’s public services; and, most importantly from a Labour point of view, a debate about social solidarity, about sharing across the territory of the United Kingdom so that together the nations of the UK can work together for the benefit of everyone who lives here.

In the end, this is about our sense of belonging: we are not simply Scots on our own, but part of a wider family of nations in the United Kingdom. The lesson of the referendum campaign is that those links remain powerful and valued by most Scots. However, it is clear that securing Scotland’s place in the UK is simply not enough. That is why the Bill really matters, because it guarantees not only economic benefits and UK social solidarity, but the scope under devolution to do more, to make different choices and to set a different course for Scotland, distinct from a UK agenda that might not always be—today certainly is not—in accordance with the public opinion of Scotland.

The Bill will make the Scottish Parliament one of the most powerful devolved Parliaments in the world—not my research, but that of the Scottish Parliament itself—with responsibility for more than 40% of tax revenues and more than 60% of public spending. Critically, the Bill provides more accountability. Lord Smith said that the agreement had the potential to increase financial discipline, promote greater budget transparency and enhance the debate on fiscal policy in Scotland. That is important, because the Scottish Parliament already has devolved responsibility for many of the areas that are critical to the day-to-day life of Scots: health, education, housing, justice, transport, economic development, local authority and business rates, 10p of income tax and all immovable taxes, borrowing powers and much more besides.

The problems in Scotland with accident and emergency waiting times, lower educational attainment and a crisis in housing show that the more important debate in this House is about how powers are utilised, rather than where they lie. After this Bill is passed, the Scottish Government, as the most powerful devolved Government on earth, will have immense power to change our society for the better—to create a fairer Scotland and a fairer country—but the Bill will also ensure that Scotland continues to benefit from the pooling and sharing of resources across the United Kingdom.

What is required now is the imagination and political will to deliver on that potential. That political will has always been a Labour priority, as demonstrated through the Calman and Smith commissions, to deliver progressive change for Scotland. The question becomes: will it be the SNP’s priority to start using new powers as a responsible Government or will it continue with a politics of grievance and blame? It appears to me from today’s exchanges that the SNP is desperate to be disappointed before the Bill has even started its passage through this House.

Labour has always been committed to ensuring that the infamous vow, negotiated by the cross-party Smith commission, was delivered in full. May I take this opportunity to thank Lord Smith of Kelvin and the 10 commissioners for their sterling work in getting us to where we are today? The Bill meets the commitment on the timetable and Labour will ensure, through the Bill’s passage in this House, that the legislation promises are also met in full, both in substance and in spirit. The original purpose of devolution was to keep the social solidarity that comes from being part of something bigger while recognising the uniqueness of Scotland’s role in the UK.

[Ian Paisley]

Does the shadow Secretary of State agree that one secret of devolution, and of this kingdom, has been parity for all of our peoples across all of the nations that share this kingdom and that the break-up of parity in social welfare payments alone has had the most destabilising impact in Northern Ireland? Indeed, more interest is given to the levels of disability living allowance than to the levels of IRA activity in Northern Ireland. Will the change to welfare payments affecting Scottish people also have a destabilising impact, not only on Scotland’s place in the Union, but on our place together as a people?

[Ian Murray]

I am grateful for the intervention, because the hon. Gentleman is describing devolution—that is how it works. It is up to individual Parliaments to make the choices, within the powers they have, on how they want to serve. Under a democratic system, the people will decide at the ballot box whether or not those decisions are ones they wish to vote for. Unfortunately, when there is devolution there will be disparities across the nations of the United Kingdom, but the important point is that the United Kingdom stays together.

[Mr Anderson]

I do not want to fall out with my hon. Friend, but it feels like the people of England will not get the choice to take any position in a democratic vote, because we are being told, “If you want devolution, you have to sign up to a regional mayor, whether you like it or not.” Without any debate, we are told, “If you don’t do that, you can’t get any money.” That is not devolution. He has talked often about social solidarity, but where is the social solidarity for us in England when this is being done without our chance to have a real debate in this country?

[Ian Murray]

I am grateful for that intervention. The Scottish referendum debate demonstrated that when there is a proper constitutional debate, under a framework for proper constitutional debate, the results are there for all to see. The overall position of the constitutional convention that we were proposing in our manifesto would have been the way to take some of these issues forward. Colleagues across England would be significantly upset to see that the devolution structure across the UK is progressing quickly while they are being hamstrung with what is being offered to them. The Government really do need to get a grip of this whole constitutional settlement across the UK, so that England does not seem as though it is losing out.

[Geraint Davies]

On that point, does my hon. Friend think it bizarre that this Government are giving Scotland the right to increase and decrease its income tax, while legislating so that England and Wales cannot increase income tax? Is that not a bit strange?

[Ian Murray]

I am grateful for my hon. Friend’s intervention, because one key question for the Treasury Minister wrapping up today’s debate will be: if the Government legislate for not increasing VAT, national insurance or income tax, what are they going to increase to cover the £23 billion of promises they made during the general election? I suppose the direct answer to my hon. Friend’s question is to say that that is the way devolution works and it is up to the different legislators to decide what they wish to do. This Bill allows Scotland a settlement where the responsibility and the accountability goes straight to the heart of politics in Scotland.

I was saying that as this Bill makes its passage through the House, Labour will ensure that legislation promises are fully met both in substance and in spirit. The original purpose of devolution was to keep the social solidarity that comes from being part of something bigger while recognising the uniqueness of Scotland’s role in the United Kingdom. But we in the Labour party want to go further. We have been calling for more powers for some time and included most of them in our manifesto, so this is not a knee-jerk response to the general election result as some would say, but a continuation of the devolution commitment.

[Alex Salmond]

I have been listening carefully to the hon. Gentleman, and he is not saying anything that was not said by Labour during the general election campaign. In many other areas, the Labour party is undergoing fundamental reassessment of policy. Having lost 40 out of 41 seats in Scotland, is there any new policy with which the hon. Gentleman wants to enlighten this House and Scotland?

[Ian Murray]

If the right hon. Gentleman wishes me to make some progress, I will come on to those very issues. Let me remind him that the devolution settlement was agreed to by all five parties on the Smith commission. The Bill that is in front of us is to ensure that the Smith agreement is put forward in full, and we want to ensure that it is put forward in full both in spirit and in substance, as I have said twice already. [Interruption.] I hear someone chuntering, “It doesn’t” from a sedentary position. Well, we are going through this parliamentary process and will seek to amend the Bill precisely because we want to ensure that it does fulfil everything in the Smith agreement, but we also want to go further.

We will seek to amend the Bill to go beyond the Smith agreement without compromising on the pooling and sharing of resources across the UK that guarantees the Barnett formula and the UK pension system for Scots. On welfare, we will ensure that the final say on benefit levels remains in Scotland by giving the Scottish Parliament a wider power to top up all reserve benefits. We will ensure that the Scottish Parliament can introduce new benefits in devolved areas funded from Scotland to meet Scottish circumstances; bring employment and welfare policy together with a positive vision for tackling the low skills, numeracy and literacy problems that hold back adults trapped in long-term unemployment; fully devolve housing benefit; and ensure double devolution by devolving job creation powers to local communities, providing real opportunities, as my private Member’s Bill demonstrated at the tail end of the previous Parliament.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

My hon. Friend is making a very good speech. Will the ability to top up social security payments enable the Scottish Parliament to get rid of welfare vouchers that were introduced earlier this year?

[Ian Murray]

That goes to the heart of some of the discussions that we will have in this Chamber during the five days we will spend considering this Bill, as some of the choices that the Scottish Parliament have made fly in the face of its rhetoric both of being anti-austerity and of looking after the most vulnerable. With the £444 million underspend in the Scottish Parliament budget last year, many of the questions just raised by my hon. Friend will be asked by ordinary Scots up and down the country.

[Robert Flello]

I am delighted to see that at least my hon. Friend is in his place. Sadly, all too many of our colleagues are not. On the devolution Bill and these proposals, is there not a danger that if things go really well, the SNP will take all the credit, but if things go badly, Westminster will get the blame?

[Ian Murray]

My hon. Friend raises the fundamental principle of nationalist politics. I remember the former First Minister, the right hon. Member for Gordon (Alex Salmond), taking great credit when unemployment fell in Scotland, and then blaming everyone else when unemployment rose, and that was a regular trend throughout the time of his premiership in Scotland. [Interruption.] I can hear him chunter “Shameful” from the Back Benches. People just have to look at the record and determine the facts for themselves.

[Pete Wishart]

I would go further than my right hon. Friend the Member for Gordon (Alex Salmond). The result for Labour a few weeks ago was catastrophic, and we have heard nothing thus far from the hon. Gentleman’s contribution that suggests that he is addressing those problems. What will he do? Will we hear a new story from Labour? Will it work with us on a progressive agenda across Scotland so that we can take on the Tories, address austerity and deal with the menace of Trident?

[Ian Murray]

Well, if my mathematics is correct, I have been on my feet for 15 minutes, and it is quite obvious that the hon. Gentleman has not listened to the first eight pages of my speech. It was about social solidarity and some of the changes that we want to see in this Bill. Let me put it on the record that I have just seen a tweet from him claiming that Labour will not vote on the SNP amendment tonight. Well, I understand that the amendment has not been chosen, so perhaps he would like to correct the record on his Twitter feed rather than yet again spreading mistruths in this House for political gain. This is a serious Bill that is trying to develop the constitutional settlement for Scotland.

[Mr Kevan Jones (North Durham) (Lab)]

The point made by my hon. Friend the Member for Stoke-on-Trent South (Robert Flello) was that if things go right in Scotland, the SNP will claim credit, but if things go wrong it will always be Westminster’s fault—[Interruption.] If this Bill is not good enough in terms of what the Scots Nats want, why are they not going down the route proposed in their “Stronger for Scotland” document, which was a move to full fiscal responsibility?

[Ian Murray]

When my hon. Friend made his point about the SNP claiming credit when things go well and blaming others when things go badly, the right hon. Member for Gordon shouted, “Sounds like a good narrative.” We are talking about people’s lives, and if we rule our country simply on a narrative we are in trouble.

My hon. Friend the Member for North Durham (Mr Jones) is absolutely correct, because it was in the SNP manifesto that they would deliver full fiscal autonomy for Scotland. In fact, the First Minister said that all the MPs elected to Westminster under the SNP banner would vote for it this year. It seems to me that there is back-pedalling on that at the first opportunity. Perhaps we will get some enlightenment on their current position on full fiscal autonomy when the hon. Member for Moray (Angus Robertson) speaks, but it certainly was not mentioned in the amendment.

[Mr Jones]

Is my hon. Friend not concerned and confused by the fact that the incoherent amendment tabled by the Scots Nats contains no mention whatsoever of what has just been suggested?

[Ian Murray]

Nothing in the amendment addresses the question of full fiscal autonomy, but perhaps during our consideration of the Bill we will find out whether that is a goal that the SNP wants to promote—[Interruption.] I hear chuntering again from the right hon. Member for Gordon from just behind my left shoulder. The level of public respect for politicians is pretty low and we are only a few weeks away from everyone having voted in the general election. When the party that won 56 out of the 59 seats in Scotland—as it consistently trumpets—dumps its manifesto just a few weeks afterwards, there is little wonder that there is so little respect for politicians in this country.

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[Mr Speaker]

Order. I do not have a party and I did not say any of the things that have just been attributed to me, but I know that the hon. Gentleman will become a seasoned practitioner before very long.

[Ian Murray]

I certainly hope that the hon. Member for Edinburgh East (Tommy Sheppard) becomes a seasoned practitioner very quickly, because he might have forgotten that I went through the general election campaign as well. At hustings all over the Edinburgh South constituency, the SNP candidate was consistently asked his position on full fiscal autonomy and, as I have just said, the answer was that the SNP would vote for full fiscal autonomy in this Parliament. This is a legislative opportunity to bring that manifesto commitment forward and if we do not see it, people will rightly ask why.

We are promoting the additional powers on welfare because more devolution can protect the most vulnerable in Scotland from the worst of the Conservative Government. The major new powers coming to Scotland give us the chance to do things differently so that never again can a Government impose things such as the bedroom tax on Scotland’s most vulnerable.

We will also seek to strengthen the Bill in other areas. I shall not give an exhaustive list. This might be a Scotland Bill, but it has implications for other parts of the UK so we will look for a UK-wide constitutional convention as part of it. Equalities are a significant part of it and we shall look to strengthen the relevant clauses to improve on gender equality in Scotland. Lord Smith heavily underlined the importance of improving relationships between the Scottish and UK Governments to provide greater scrutiny of Scottish Ministers and the need to devolve powers from the Scottish Parliament, so we shall seek amendments in that regard. The Bill offers an opportunity to deal with outstanding issues with employment tribunals and the permanence of the Scottish Parliament. Let me re-emphasise that we will ensure that Smith is delivered in full, to the letter, in both substance and clauses.

We must be vigilant as the Bill makes progress through the House, as the worst case scenario for Scotland would be an SNP asking for its top manifesto priority of full fiscal autonomy and a majority Conservative Government delivering it for them. There will be common ground on amending the Bill, and we will work together to achieve that, but I will defend Scotland night and day from the plan to cut Scotland off from UK-wide taxation and spending with full fiscal autonomy. Some people may not recognise the policy, because the SNP does not really want to talk about it now that the general election is over. First it was full fiscal autonomy; then it was full fiscal retention. It was adapted to full fiscal responsibility, and yesterday on Sky the hon. Member for Moray called it full fiscal manoeuvre. Indeed, this lunchtime, the hon. Member for Dundee East (Stewart Hosie) confirmed that the SNP may amend the Bill to demand full fiscal autonomy. The picture is not clear, and Scots deserve an answer on this fundamental broken promise in their manifesto.

The SNP is uncomfortable with the name, because it is uncomfortable with the policy. It knows that the consequences of such a policy would be severe for Scotland. It is a source of great shame that it simply is not honest about it, and it has five days on the Floor of the House to explain it. Recent analysis by the impartial experts at the Institute for Fiscal Studies showed that by the end of the debacle the black hole in Scotland’s finances could be as much as £10 billion, which would mean spending cuts or tax rises to fill the gap. That is over and above the cuts already imposed by this Government. That means austerity max.

I will not shirk from holding the Government in Scotland to account for their policies at the Dispatch Box regardless of how much SNP Members chunter. If there was no pooling and sharing of resources across the UK, there would be no secure extra spending coming north—extra spending that has built the schools and hospitals that educate our children and care for our grandparents. It would mean an end to the UK pensions system at a time when the proportion of pensioners in Scotland is set rapidly to outgrow the proportion of people in work, paying the taxes that fund the pensions system. It would mean an end to the UK welfare state—the idea that if someone has paid into the UK system they get at least the same basic minimum back regardless of where they live. In short, it would mean an end to the social solidarity that makes Britain what it is today. That is not a left of centre or even a progressive case. It is a recipe for disaster.

[Ms Tasmina Ahmed-Sheikh (Ochil and South Perthshire) (SNP)]

Does the hon. Gentleman not agree that this is the place where we hold the UK Government to account?

[Ian Murray]

We are debating the Scotland Bill on Second Reading, and I am making the Labour party’s position clear. We will fight night and day to prevent full fiscal autonomy because it would be bad for the Scottish people. That is our job as a credible Opposition, and we will amend the Bill to make it better for Scotland, regardless of what other parties want to do in this place. If the hon. Lady is so confident about full fiscal autonomy I look forward to her tabling an amendment so that we can debate it on the Floor of the House.

Only last year, we were told that independence could be delivered in just 18 months. A 300-year old Union could be disentangled in a year and a half. We could apply to be an EU member state in 18 months. [Interruption.] I am sure that we received legal advice on that from the person who is chuntering behind my left shoulder again. We could set up our own treasury and foreign office; establish our own navy, army and air force; create intelligence and security services.; develop a separate welfare state; and write a new tax code. All of that, we were told, could be achieved in just 18 months, but we are now being told that full fiscal autonomy is not achievable in the short term. [Interruption.] Again, the chuntering says, “Oh yes, it can be achieved”. Well, if it can be achieved in the short term, we look forward to amendments being tabled, and we can debate them on the Floor of this political House.

There is another danger: the Conservative Government having a clumsy and short-sighted approach to the wider constitutional issues of the United Kingdom. They talk of one nation, but I am not sure which nation they are talking about. As the sun was rising over Downing Street on the morning after the referendum, the Prime Minister linked the question of English votes for English laws with the referendum result. He said that just as the Scottish Parliament would vote separately on issues of tax and spending, so too would England. Linking these two issues could have unintended and undesirable consequences, weakening the very Union that Scotland voted to maintain. Devolution of power to England and its regions is essential, and we proposed a radical approach during the election. However, we must make sure that reform is coherent and that we understand the consequences.

It was rash and unwise of the Prime Minister to use the referendum result in Scotland, not to reach out, but to continue to divide the nation. It was equally dangerous for the Prime Minister to stoke division and grievance between the nations of our United Kingdom during the election campaign.

[Andrew Gwynne]

My hon. Friend is making the case for a UK-wide constitutional convention, which is important for my constituents in Greater Manchester, where we are being offered a form of devolution by this Government. Is it not also about the city regions in Scotland? Should there not be devolution from Holyrood to the cities and regions of Scotland?

[Ian Murray]

My hon. Friend is right. Over the past eight years or so we have seen the Scottish Parliament become one of the most centralist Parliaments in the world, sucking up power from local authorities and ensuring that local authorities cannot raise their own taxation. What we want to see—we will table amendments to this effect—is double devolution so that we will devolve powers from Westminster to Holyrood and ask Holyrood to devolve those powers out to local communities, which are best placed to deal with the problems facing Scottish communities.

I was talking about the clumsy way in which the Prime Minister has dealt with the UK constitutional settlement. In our manifesto we called for a full and proper constitutional convention which would be able to examine some of these issues so that we could have a more coherent and sustainable approach to the way that the UK operates.

We will not oppose Second Reading today. We will seek to improve the Bill in Committee and I have set out some aspects of it where we will try to do that. This is a real opportunity to provide a stable and durable devolution settlement to create a fairer, more prosperous Scotland. When this Bill is passed and these new powers make their way to the Scottish Parliament, we look forward to the debate moving on to how the powers will be used, rather than who will use them. That is the real debate and the one that the Scottish Labour party will relish in its historic fight for social justice, fairness and equality both in Scotland and across the United Kingdom.

[Several hon. Members]

rose—

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[Angus Robertson]

I want to make some progress, but I will give way to the hon. Member for Edinburgh South.

[Ian Murray]

To be clear, can the hon. Gentleman confirm that he is saying that the SNP will introduce an amendment to deliver full fiscal autonomy for Scotland, and that the Labour party should support a measure that would put a £10 billion black hole in Scotland’s finances? It is not about walking through the Lobby with anyone; it is about standing up for Scotland’s interests.

[Angus Robertson]

I am grateful to the hon. Gentleman for letting me intervene in his second speech in this debate. He needs to consider closely the impact of his party’s collaboration with the Tories for two years on the independence referendum campaign. He can say whatever he likes about full fiscal autonomy, which the SNP supports and which the other parties oppose. They have this in common: they are unbelievably unpopular in Scotland, and it will take a while for them to learn the lessons from that.

The hon. Gentleman had the opportunity in his speech from the Front Bench to outline any new thinking, new ideas or anything else that the Labour party did not say in the Smith commission proposals. There was not a peep; not one new idea. That, along with his party’s ongoing co-operation with the Conservative party, will consign Labour to the opposition position that it deserves in Scotland.

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[Mr Gauke]

The reality, as the right hon. Gentleman knows very well, is that there has been a spirit of working constructively from the Government across the piece. On the particular issue of welfare, concerns have been raised about what the SNP describes as a veto. Put simply, it is not a veto. The position is that there are clauses whereby, for practical reasons, the Secretary of State needs to give consent to ensure that something is practical. That consent cannot be unreasonably withheld, and if something is unreasonably withheld the courts can declare that it has been unreasonably withheld.

[Ian Murray]

I hope I do not get struck by lightning for agreeing with the hon. Member for Perth and North Perthshire (Pete Wishart), but could the Minister and the Secretary of State look at clause 25, particularly subsection (3)(b), to see whether it could be redrafted to take away the ambiguity about whether or not there is a veto?

[Mr Gauke]

There is no veto. Our approach will be constructive throughout all stages of the Bill. I want to be clear with the House. The intention is not to block a measure in perpetuity; it is to ensure that something that has an impact on the Department for Work and Pensions can be done practically, because DWP has to deliver it and needs to be able to ensure that it can do so.

I am pleased to say that earlier today the Chancellor and the Chief Secretary to the Treasury met the Deputy First Minister. They had a productive meeting and agreed to immediately start work on the fiscal framework, which works alongside the Scotland Bill, ensuring that the Scottish Parliament has the tools it needs to manage its significant new tax and spending powers. We have agreed to aim to finalise the fiscal framework by the autumn, alongside the passage of the Scotland Bill through Parliament.