Commission on Devolution in Wales
Jonathan Edwards Excerpts(11 years ago)
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Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Over recent months, the Tories in the Senedd and the Liberal Democrats have pledged to alter individual tax bands should they form the next Welsh Government. Would not those specific pledges be undeliverable due to the lockstep that the Secretary of State has announced today?
Oral Answers to Questions
Jonathan Edwards Excerpts(12 years, 5 months ago)
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Mr Jones
The Government are very closely engaged with the steelmaking industry via UK Trade and Investment, and I would reiterate the point that, given the news we heard yesterday, it is extremely important that the Welsh Assembly Government should work closely with UKTI to foster that industry.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Does the Minister agree that one of the major challenges facing the Welsh economy is the deficit in exports generated in Wales and imported goods and services from other states, as well as from within the UK? What discussions is the Minister having with Cabinet colleagues and the Welsh Government to expand and diversify the Welsh export base—in particular in manufacturing, once a great strength of the Welsh economy?
Mr Jones
The hon. Gentleman is entirely right to point that out. Over the next few weeks there will be an enormous opportunity for Welsh industry in the shape of the British business embassy, which exporters and importers from all over the world will be attending. I understand that the Welsh Assembly Government are now engaging, albeit tentatively, with that embassy, but I urge them to do more.
Oral Answers to Questions
Jonathan Edwards Excerpts(12 years, 7 months ago)
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Mrs Gillan
I agree entirely with my hon. Friend. It must be very good for those people whom we have taken out of tax altogether and the lower paid workers who will benefit from our tax changes, because it will put money directly back in their pockets rather better than the Welsh Labour Government down in Cardiff Bay, under whose auspices council tax has doubled in Wales.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
The Budget included a clear framework for reducing localised pay in the public sector. Considering that there is a direct link between money in people’s pockets and spending in the local economy, how will depressing pay encourage economic growth in the poorest parts of the British state?
Mrs Gillan
When it comes to local pay, our aim is to create a more flexible labour market that is more responsive to the challenging economic conditions we currently face. We want to create more private sector growth and, as a consequence, wealth in Wales and across the UK.
Welsh Affairs
Jonathan Edwards Excerpts(12 years, 9 months ago)
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David T. C. Davies
I accept that that would be absurd, and I do not think for one moment that it will happen, because I am certain that with or without these reforms—I very much hope that they go through—the services that are offered in England will continue to be of the highest quality. However, the Welsh Assembly Government could choose to do that if they felt that the necessary services were not being provided. It is a purely hypothetical situation, because the services in England will be as good as, if not better than, they already are.
Waiting lists in Wales are far longer than they are in England. While 90% of people in England get treatment within 18 weeks, the figure is about 68% in Wales. People in Wales are twice as likely as those in England to succumb to a hospital-acquired infection. One of the rare cancer charities has said that people who live in England are five times more likely to get drugs for rare forms of cancer than those who live in Wales. Our health service in Wales is no longer the envy of the world; it is certainly not the envy of other nations of the United Kingdom. We have no moral right to tell the English what they can do with their better-run health service when ours is running so lamentably.
Jonathan Edwards
I have some sympathy with the hon. Gentleman’s argument as regards political sovereignty, but the big issue about the health reforms in England is their effect on the Barnett consequentials, which have a direct impact on funding in Wales. For as long as the Welsh Government are funded by that very discredited formula, it is important for Welsh MPs to vote against Bills that reduce funding for the health service in Wales.
David T. C. Davies
I respect the hon. Gentleman’s view, but it is not one that is shared by his political counterparts in Scotland, who take the principled position that they will not get involved in any issues that are completely devolved. Since he has mentioned funding, it is worth pointing out that in England the Conservative-led coalition Government are putting more money into the health service every year at a time when the Welsh Assembly Government are cutting health funding.
I was referring to the NHS in the context of the Union, as did the right hon. Member for Torfaen. We are both Unionists. My simple point is that it will not be possible to construct a stable Union if there are left-wing Governments in Scotland and Wales, which are generally left-wing places, with left-wing Members of Parliament who try to prevent the English, who are generally slightly more conservative, from carrying out the policies that they wish to carry out. The hon. Gentlemen on the Opposition Benches are trying to have their cake and eat it.
Mr Llwyd
I take what the right hon. Gentleman says, but I do not agree.
Nobody can deny that the Holtham report was a very good piece of work, and I think that what needs to be done first is the reform of the Barnett formula. Surely, that is the first thing to do; then we can look further. Without taking up too much time, I hope to develop a few thoughts about the fiscal powers that could reasonably be called for at this stage of the devolutionary process.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Will my right hon. Friend give way?
Jonathan Edwards
When we debated the Silk commission a few months ago Labour Front-Benchers were completely opposed to the transfer of any fiscal powers. The poll today shows that more than 60% of the people of Wales are in favour of such a step, so does it not prove that the Labour party is completely out of tune with the wishes of the people of Wales?
Mr Llwyd
Well, yes; on this issue, that has to be right. If 60% of people are saying that fiscal powers are the next stage, that amounts to a large majority—and we should listen to them.
We have sent a submission, and we argued that significant tax revenues and powers should be transferred to the Welsh Government, including partial income tax, value added tax, corporation tax and resource taxes. We have also argued that powers to create and levy new taxes should be granted. We want ownership and control over the Crown Estates in Wales to be transferred in their entirety to the Welsh Government. We believe that taxation and borrowing powers play an important part in facilitating economic growth and ultimately in ensuring social justice. Such powers have been proven to work at a sub-central level throughout the world, but are lacking under the current devolution arrangements.
Half the current rate of income tax could be paid to the Treasury in London, with half remaining with the Welsh Government in Wales, who could then adjust according to need. The Welsh Government should then have the power to set Welsh income tax rates without restriction. These would be additional to the remaining UK rates.
Powers over VAT would give the Welsh Government a significant source of revenue, as well as the opportunity to make adjustments to achieve policy goals. This could ensure that Wales would not be disadvantaged by any future decision of the UK Government to switch the emphasis of the tax system between direct and indirect taxes. I recognise that variation of VAT rates within a member state might be prohibited under EU law. If that is the case, we would wish to see a transfer of imputed VAT revenues to the Welsh Government. We think all corporation tax revenues should be transferred, as should the power to set rates.
Jonathan Edwards
If it is good enough for Northern Ireland, it is good enough for Wales.
Mr Llwyd
I am coming to that in a moment. My hon. Friend did not write the script; it is just that we are ad idem on the point.
Corporation tax offers a powerful tool to facilitate increased performance. It would be desirable to transfer powers over structural elements of the tax, such as the definition of taxable profit. We know that devolution of corporation tax to Northern Ireland has been a hot topic of discussion in recent times—and the same arguments, it seems to me, are relevant to Wales.
Wales should be empowered to reap the benefits of its resources. The land and water of Wales should be used for the greatest environmental, social and economic gain. All powers and revenues associated with existing resource taxes, such as landfill tax and aggregates levy, should—subject to EU approval—be transferred. Wales should also have the power to create and levy new taxes on all aspects of resource exploitation, including water and renewable energy. Indeed, we should have the greatest possible devolution of taxation powers and revenues permitted by European law.
Some specific taxes, powers and revenues relating to taxes on property and land— such as stamp duty, land tax and capital gains tax on property and land—should, we think, be transferred to Wales, as should air passenger duty, which is being transferred to Northern Ireland under this year’s Finance Bill. The debate on that very measure is taking place in Westminster Hall as we speak.
We also support the transfer of alcohol and tobacco duties, including the ability to place a minimum price per unit on alcohol sales. We do not think that national insurance contributions should be devolved in the current circumstances, as they are notionally hypothecated for the funding of social protection services. Those services are reserved to the UK Government and are needs-related, with common treatment of citizens throughout the UK. However, although the lack of a devolved benefits system rules out the devolution of national insurance contributions at present, we would like them to be devolved in the longer term.
The commission will receive its oral evidence during the coming weeks. We look forward to its report on part I later this year, and hope for the swift introduction of any recommended changes that receive support across the political ground and from experts.
The Welsh Government recently opened their consultation on a Welsh legal jurisdiction, and I shall be responding to it despite the Secretary of State’s rather disappointing pronouncements on the matter last week. I shall also be giving evidence to the constitutional committee of the Assembly in a few weeks’ time. Great changes have taken place in the Welsh legal system which would have been unthinkable some years ago, such as the creation of Legal Wales and the establishment of the administrative court for Wales. There are regular sittings of the Court of Appeal—both civil and criminal—in Cardiff, and judicial review cases involving Welsh public bodies are routinely being heard in Wales.
Following last year’s successful referendum, the National Assembly for Wales now has the power to legislate in devolved areas without the interference of Westminster, and as a distinct body of Welsh law begins to be built, we shall inevitably need a distinct Welsh legal jurisdiction. However, that must go hand in hand with Wales taking full responsibility for justice matters. It is common sense that the right to administer the justice of laws that apply to the people of Wales should be placed in the hands of our own Government.
It worries me that the Legal Services Commission will shortly rule out the one Welsh commissioner representing Wales, given the developments relating to, for instance, legal aid. I am sure that that would not happen if Cardiff had any say in the matter. As I have said, a corpus of Welsh law is developing. Divergence between Welsh and English legal practice and procedure in family law, criminal law and, obviously, administrative law is taking place each and every day, and anyone who practises in those areas must know what Welsh law dictates.
I believe that the National Assembly for Wales is the only legislature in the world that does not have a distinct legal jurisdiction. That is an anomaly, but I think it is also a bit of nonsense. We need only look at the introduction of elected police commissioners—which is likely to take place, despite the disagreement of our representatives in Wales and many Welsh Members of Parliament—the cuts in community justice through the courts closure programme and the continued failure to introduce either bilingual juries or a north Wales prison to see that the interests of Wales are not best served by its continuing slavishly to follow the line set down by London.
As Members will know from earlier debates and votes, we feel strongly about the devolution of permit powers for energy generation above 50 MW on land, and we believe that all powers in Welsh waters should be transferred to the Welsh Government. All parties have backed the change to some extent, and the question should be “how much” rather than “whether”. I am sure that the issue will be debated at some length in part II of the Silk commission. The media will also be discussed keenly, especially in view of the changes forced on S4C by the UK Government in the past two years and the interest of the Welsh Government in such matters.
As has already been said, devolution is not an event but a process, and I think it right to revisit and assess its workings. The people of Wales gave their opinion in the referendum last March, and they agreed to it. According to every opinion poll, they want more powers over policing, justice, energy and the media, at the very least. We look forward to the publication of the reports and their implementation as soon as possible, and we hope that the necessary Government time for any legislation that may be required will be found during the present Parliament.
I am very grateful to have had this opportunity to take part in the debate. I apologise for speaking for so long; I probably took too many interventions. I am also pleased that so many Members wish to contribute to the debate.
Jonathan Evans (Cardiff North) (Con)
It is always a pleasure to follow the right hon. Member for Dwyfor Meirionnydd (Mr Llwyd). However, given the time limit, I hope he will forgive me if on this occasion I do not respond to any of the points he raised.
Yesterday, a very emotional event took place in Cardiff: the Wales football team played Costa Rica in the Gary Speed memorial match. Several great tributes were paid to Gary, but perhaps the greatest was the behaviour of those who attended the match. Those people were a credit to their country.
Indeed, over the past few days there have been several sporting events involving Wales or Welsh teams, all of which have been a great tribute to our country. I cannot pass up the opportunity to say in the Chamber that it was great news that Wales won the triple crown at Twickenham—that will unite the House on this occasion.
The Wales rugby team is captained by Sam Warburton. He attended a school in my constituency: Whitchurch high school. It is the largest school in Wales. I recently had an opportunity to remind the Prime Minister that, in this Olympics year, that school has won the award of state school of the year for sport. That is a great accolade for Wales and for that school. The school has also produced Gareth Bale of Tottenham Hotspur and Geraint Thomas, the Olympic gold medallist, who we hope will again be an Olympic winner this year.
Following that rugby match, a WBO light-heavyweight fight took place in Cardiff, with Nathan Cleverly defending his title. In a week in which a boxer who was fighting for a heavyweight title embarrassed our country, Nathan Cleverly—a Cardiff university mathematics graduate—was a credit to it.
Cardiff City football club’s performance in the Carling cup final was also a credit to our country; that statement too ought to unite the House. I was at Wembley watching that game, and Lord Kinnock was sitting three rows behind me. He is a great supporter of Cardiff City, of course, but that is the first time I have ever seen him at a match when he has not been in the directors box. I want to be collegiate, however.
I am very concerned about football governance. It is worth bearing in mind that although Cardiff City were playing at Wembley for the fourth time in five years, during that period there have been winding-up orders in relation to the club. There have also been administrations in relation to Wrexham football club and several other clubs in the UK.
Jonathan Edwards
Will the hon. Gentleman also congratulate the Swansea City football club model? Supporters have a share in the club, and the team is doing Wales proud in the premier league.
Jonathan Evans
I am very happy to note the success of Swansea City, which the hon. Gentleman has put on the record, but as I still hope to retain the support of my electorate, I will say no more on that subject.
Returning to the question of football governance, the Culture, Media and Sport Committee has produced a report to which the Government have responded. The Minister for Sport and the Olympics has said that football is the worst-run sport in the country. Sadly, that is true, and it is true not only in respect of Football League clubs: even the top teams, such as Manchester United, Liverpool and Arsenal, have ownership structures that cause genuine concern.
Mrs James
I thank the hon. Gentleman for his comment, but obviously I do not agree. These charities are reputable, I have worked for some of them, and I can certainly tell him that the families I represent in Swansea East meet the criteria and will be in difficulty in the future.
Jonathan Edwards
The hon. Lady is making some very important and pressing points, but how will the Labour party’s policy of a regional benefit cap help the situation?
Mrs James
We must consider this in the round, because we need to tackle some of the problems we have. It is not easy and I do not say that we have the answer, but we must look at all the avenues. I support that policy, but I am watching it very carefully. We need to do that and we need to see how it would work.
The minimum number of working hours has gone up from 16 to 24 a week, and what a problem that has created. It has created problems for the employers in my constituency who are willing to employ people part time but cannot increase their hours.
Nia Griffith
I will not give way.
The hon. Member for Brecon and Radnorshire spoke of the importance of small businesses in Wales, and my hon. Friend the Member for Vale of Clwyd (Chris Ruane) praised the benefits of mindfulness. The hon. Member for Carmarthen West and South Pembrokeshire reminded us of the beauty of Pembrokeshire, only to be upstaged immediately by my hon. Friend the Member for Ynys Môn. The hon. Gentleman also mentioned the contribution of local companies to the UK economy, which is extremely important.
My hon. Friend the Member for Ynys Môn referred to the need for clear policies on energy, and I shall return to that matter shortly. The hon. Member for Ceredigion (Mr Williams) made the case for devolving Welsh language broadcasting. Sadly, the hon. Member for Aberconwy (Guto Bebb) spent a great deal of time criticising a report, when his constituents would probably have been more interested if he had taken up the very real issue of rocketing prices at the petrol pump, particularly in rural Wales.
If we are to see the economy in Wales flourish, we need economic policies from the UK Government that will stimulate growth. We need fiscal policies that will strike the right balance between paying down the deficit and getting the economy going. We need taxation policies that do not squeeze lower and middle income households so hard that they have no money to put back into the Welsh economy and struggle even to pay the most essential household bills.
I was dismayed to hear the Secretary of State reiterate at Welsh questions yesterday that she was in favour of sticking to plan A. I am sorry to have to point out to her that her Government’s plan A is hurting but not working. Sometimes I wonder what planet she is living on. She only has to walk down any high street in Wales to see shops closing and the economy on its knees. The latest high-profile victim is Peacocks. We certainly welcome its takeover by the Edinburgh Woollen Mill and the jobs that that has secured, but 3,000 jobs will still be lost and more than 200 shops will close, including both the Peacocks stores in Llanelli.
No matter what initiatives the Welsh Government undertake—I point out two in particular: the excellent Jobs Growth Wales programme aimed at creating 4,000 jobs a year, with an emphasis on the private sector; and help for business in the form of some £55 million in grants and loans—UK economic policy is enormously important in helping or hindering the success of those initiatives. When it comes to inward investment to Wales from overseas, I certainly agree that there should be the closest possible collaboration between the Welsh Government and other relevant bodies such as UK Trade & Investment to avoid duplication and increase Wales’s outreach overseas.
We are not going to get anywhere, however, unless we have a UK Government providing the right economic and business climate to make the UK a preferred destination for investment in business and manufacturing. When Labour was in government, an additional 1.1 million new businesses were created. By the time we left office in 2010, the World Bank ranked the UK as the best country in Europe for ease of doing business and fourth best in the world, ahead of the US. While there is always room for improvement and we should seek to streamline wasteful bureaucracy, time-consuming duplication and form filling, to use cutting red tape as the main strategy for driving economic recovery, as this Government seem to be trying to do—and, indeed, as the Under-Secretary for Wales said yesterday at Welsh questions—is addressing the wrong problem. That is to avoid the two very real issues of creating the right economic conditions to foster growth and creating the right political climate—that is, the certainty about policy that is needed to encourage long-term investment in manufacturing and jobs.
The Government’s attitude to business and industry matters—it matters very much to Wales. What business and industry need more than anything are certainty and confidence that the UK Government will not move the goalposts. It is extremely disturbing that this Conservative-Lib Dem Government have created so much uncertainty about their commitment to green policies that the UK has slipped from third to 13th in the world for investment in green growth.
The Secretary of State and her Cabinet colleagues need to restore business confidence and create a climate of certainty before they damage any more industries or frighten off any more potential investors. We have seen how the UK Government’s catastrophic imposition of sudden changes to the feed-in tariffs for solar panels is already putting hundreds of jobs at risk in Wales. Here was a scheme that gave a real boost to private industry in Wales—a scheme that was unlocking capital and attracting people to use their savings or borrow money to invest in solar panels. By investing that £10,000 or £20,000, they were providing private sector jobs in the Welsh economy. What other scheme do the Government have to unlock capital in that way and use it to stimulate growth in the local economy?
As my hon. Friend the Member for Ynys Môn mentioned, before the election Labour set up a £60 million fund to attract investment in offshore wind power. In 2010, the current Prime Minister promised to continue the policy, but nearly two years later just £1.2 million has been awarded and many companies are looking elsewhere to invest. Indeed, big investors in wind energy, such as General Electric, Vestas, Gamesa and Mitsubishi, are threatening to take millions of pounds worth of green jobs abroad because they are losing patience with this Government. They do not know where they stand, and they now seriously doubt the Tory Government’s commitment to renewables.
The UK has some of the best wind resource in the world. Indeed, the UK is the windiest country in the EU, and we have our fair share of it in Wales, but the signals coming from the UK Government are confused, hesitant and lukewarm. When companies are making big decisions about where to build energy installations or set up factories to manufacture the components, they need to know what Government policies are, what returns they can expect and what the financial incentives are—they need a climate of certainty. I urge the Secretary of State and her Cabinet colleagues to provide clear policies to attract green investment.
Moving on to UK Government policy that affects Wales, only a fortnight ago we heard the very worrying news that Britain could lose its treasured triple A rating—the very justification the Chancellor has used for his crippling austerity measures. Why would the UK lose its triple A status? Because this Government have forgotten that in order to pay back the deficit, they also have to think of stimulating growth in the economy to make the money to pay back the deficit. That is where this Government are failing. This Government inherited a growing economy, so it is no wonder that people are asking why we have seen almost no growth for a year and why the Government have had to revise their borrowing up by £158 billion.
We are seeing just what Labour has been warning of since 2010: the Chancellor is cutting too fast and too deep, and by hitting lower and middle income households the hardest, he is hitting the very people who spend their money most immediately back into the Welsh economy just to keep themselves clothed and fed. His policy is not only deeply unfair; it is economic madness. It is already having a direct effect on the Welsh economy, and we have only seen the beginning of the cuts. Let us make no mistake: over the next three years, the Government will—according to House of Commons figures—take £6 billion out of the pockets of people in Wales, and that will include £800 million in tax credits. Tax credits are money that families who are working hard and trying to do the right thing are given to top up their incomes, and they need to spend that money straight away in order to keep their homes warm and their children fed and clothed.
What else is the Chancellor cutting? He is cutting £7 million from health in pregnancy grants, and £113 million from child trust funds, and the freezing of child benefit is equivalent to a cut of £249 million. He is cutting £209 million from disability living allowance, and £43 million from lone parent benefits. All that is coming out of the Welsh economy, as is the £1.5 billion cut that will result from the use of CPI rather than RPI to uprate benefits, and all that is happening against the background of pay freezes—not to mention the more than £2 billion cut represented by the rise in VAT.
What we need now is a real economic stimulus from the UK Government to back up the Welsh Government’s initiatives on jobs and help for industry, and that is what I ask the Secretary of State to provide. I ask her to look at Labour’s five-point plan for stimulating the economy, and to cut VAT, boost jobs and stand up for Wales by doing something that will really help to get the Welsh economy going. People cannot see any help at all coming from the Secretary of State to us. They cannot see the Secretary of State standing up for Wales, and that is what they would like to see.
Oral Answers to Questions
Jonathan Edwards Excerpts(12 years, 9 months ago)
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Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
9. What discussions she has had on Barnett consequentials to Wales for High Speed 2.
The Parliamentary Under-Secretary of State for Wales (Mr David Jones)
My right hon. Friend the Secretary of State and I have had recent discussions with ministerial colleagues in Her Majesty’s Treasury on a range of issues, including funding for Wales.
Jonathan Edwards
HS2 is clearly an England-only project, yet the Chief Secretary to the Treasury said last week in answer to a question that I had tabled that Barnett consequentials would be decided after “budgeting and funding arrangements” had been completed. Will the Minister ensure that Wales does not lose out on the £1.9 billion that it should receive as a result of HS2, by securing guarantees that the project will be funded via a stream that results in Barnett consequentials? [Interruption.]
Mr Speaker
I hope the Minister caught the thrust of that—the Prime Minister was momentarily troubled by some sort of insect.
Oral Answers to Questions
Jonathan Edwards Excerpts(12 years, 10 months ago)
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Mrs Gillan
I agree with my hon. Friend, because it was the extra funding from the Treasury to the Welsh Government that enabled the leader of the Welsh Liberal Democrats in the Assembly to negotiate the extra funding for the pupil deprivation fund. That merely follows what my right hon. Friend the Secretary of State for Education has introduced in England. It is worth reflecting that after 13 years of Labour government the spending gap between England and Wales remained at around £600 per pupil.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
The signature policy of the recent autumn statement was the capital investment programme, which included provision to raise £25 billion of finance from pension funds. What discussions has the Secretary of State had with the Welsh Government and the Treasury to put in place structures to ensure that Wales does not lose out?
Mrs Gillan
As the hon. Gentleman knows, the settlement on capital funding has been good for Wales. The additional moneys that were announced in the autumn financial statement have made a great difference to the way in which the Welsh Government are budgeting. I regularly meet Welsh Government Ministers and colleagues in the Treasury. If the hon. Gentleman wishes to know further and better particulars, I will ensure that we talk together from time to time about developments.
Oral Answers to Questions
Jonathan Edwards Excerpts(13 years ago)
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Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
It is estimated that the SME sector accounts for 90% of employment in Wales. What discussions has the Minister had with the Welsh Government about promoting this vital sector?
Commission on Devolution in Wales
Jonathan Edwards Excerpts(13 years ago)
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Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Will the Secretary of State give way?
Mrs Gillan
May I make a little progress? The commissioners bring a wealth of experience to their important task. The commission is chaired by Paul Silk, a distinguished former Clerk to the National Assembly and to this House, whom we all know. Paul is already getting to grips with his task and introducing himself to those with an interest in the commission’s work.
The hon. Member for Arfon referred to the two independent members, and they are very distinguished. Dyfrig John CBE is chairman of the Principality building society and a former deputy chairman and chief executive of HSBC bank. Professor Noel Lloyd CBE is a former vice-chancellor and principal of Aberystwyth university. Neither is on the commission with a political remit. They are there as independent members to offer their best advice and to support the other members. I am sure that absolutely nothing from them will have a political bias. They will consider matters objectively and with expertise.
There are also four party political nominees on the commission, each nominated by one of the four political parties in the Assembly. Professor Nick Bourne is the Conservative nominee, and former leader of the Welsh Conservatives in the Assembly; Sue Essex is the Labour nominee, and a former Welsh Assembly Government Minister; Rob Humphreys is the Welsh Liberal Democrat nominee, and director of the Open university in Wales; and Dr Eurfyl ap Gwilym is the Plaid Cymru nominee, and best known for giving Jeremy Paxman a run for his money. I am sure that the commission’s debates will be lively. I believe that that is a first-class team, and it will meet for the first time tomorrow to consider how it will work through the next two years. The commission has a challenging brief because, importantly, we hope that it will build consensus on its proposals.
Mrs Gillan
I will give way first to the hon. Member for Carmarthen East and Dinefwr—I have not given way to him previously—and then to my hon. Friend.
Jonathan Edwards
Based on what the Secretary of State says about consensus, which we hope the commission will be able to achieve, will she outline the process, how its recommendations will reach the statute book, and the time frame? No one in Wales is interested in a kicking-into-the-long-grass game.
Mrs Gillan
It depresses me a great deal to hear hon. Members say that I am kicking the matter into the long grass. I am certainly not. I am trying to take a mature and adult look at the financial structures and the constitutional and legislative structures affecting Wales. However, I will not prejudge the outcome, and I will not be prescriptive, but I have to look at potential timetables. Three have been set out. One has a shorter time scale, which assumes that, whatever the recommendations, no manifesto commitments or referendum would be necessary. In fact, it would be very difficult to produce a Bill by the time of the next general election, and the time scale could be unfeasibly short. However, again, I am not ruling that out; I am simply saying that it would be difficult. If we did that, and if there were new fiscal and constitutional powers, they would be implemented post-2015.
Another scenario is based on a manifesto commitment and no referendum, which would lead us to believe that there would be legislation after the next general election. However, I do not know what the Silk commission will recommend, or whether it will require both manifesto commitments and a referendum, in which case the time scale would be slightly longer.
I would like the hon. Gentleman to take me at my word. We are taking a long, hard look at the matter in a genuinely cross-party way. I think he knows that I made some effort to ensure that his party was included, because I thought it was important to start as we mean to go on. I hope that we will continue in that vein, although I appreciate that anything could happen at any time.
Mr Hain
We are talking about Wales, but I think most people, including the Scots, would concede that Scotland has done pretty well out of the formula compared with Wales. Wales is now losing out under it.
As the Barnett formula reaches the end of its life, now is the time to act. In refusing to address the convergence problem that is now occurring, the Government are penalising and disadvantaging Wales. We always acted responsibly and in the interests of Wales, and we are the only party with a deliverable and fair funding plan for Wales. Silk cannot be used to let the Government off the hook on Barnett. Although we are open to the idea of Wales raising some of the money that it spends—perhaps, as the First Minister has indicated, through stamp duty and aggregates tax—that must not be at the expense of the needs-based settlement that is vital for Wales.
Jonathan Edwards
As the right hon. Gentleman knows full well, the issue of Barnett will now be dealt with through discussions between the Welsh Government and the UK Government. Rather than try to undermine the Silk commission, would he not be better off turning his guns on the First Minister so that he gets his act together?
Mr Hain
I will make a bit of progress, then I will happily take interventions.
Holtham calculated that approximately £17.1 billion of tax revenue is raised in Wales every year. Total public spending in Wales is about £33.5 billion—almost twice the amount raised. We should not be ashamed or embarrassed by that. Wales’s needs are greater than those of other parts of the UK. We have a history of relatively high levels of ill health, caused by our industrial legacy of mining and heavy industry. Also, we suffered the cataclysmic shock of sudden and mass unemployment, with the wholesale pit and traditional industry closures in the 1980s, which left high levels of economic inactivity and, because the then Tory Government did not drive investment to create new industrial sectors, relatively lower levels of business activity. That is why we should look before we leap. The so-called devolution-max or independence-light settlement advocated by the nationalists —and, I suspect, tempting to the Tories—could be disastrous for Wales.
Jonathan Edwards
The shadow Secretary of State is quoting figures from the Holtham commission, but that commission reported that the revenue raised in Wales by UK-wide taxes was £17.1 billion and that UK expenditure was £25 billion, not the £33 billion that he has been quoting in the press today.
David T. C. Davies
It is not a conspiratorial view; it is a view based on the history of what has been going on. We seem to be locked in a kind of constitutional groundhog day, with the same sequence of political events repeating itself over and over again. The process starts with the Welsh Assembly being granted a whole load of powers and saying, “That’s it, we’ve got all the tools we need for our toolkit.” That seems to be the popular term at the moment. “We’ve got everything we need now. We’re just going to get on with the job.” Then, a few years—or, in this case, a few months—later, it says, “Well, actually, we can’t do the job we need to do. We just need a few extra powers.” Then a commission of the great and the good is set up, often with the same people appearing time and again. They go off and consider the matter, public meetings are held, and they come back and say, “Yes, we need a bit more.” Perhaps a referendum is held, or perhaps there is just another Act of Parliament or some statutory instrument. The Assembly gets what it is given and everything goes quiet for a few months. Then the whole thing starts up again. We are in the first phase of the cycle at the moment. This is not a conspiracy; it is just how things have been happening in Wales since about 1999.
I would be delighted if we really were going to consider varying the powers of the Welsh Assembly, because I assume that varying can cut both ways. It could mean that, rather than just handing the Assembly new powers, we could look at taking a few powers away from it, once in a while. I suggested that in a Westminster Hall debate a few years ago, when Wales was doing particularly badly on the health service, but it did not seem to meet with much approval from anyone—certainly not anyone in my political party. The very fact that it had been suggested was a source of outrage to many.
The Welsh Assembly can take powers away from local authorities that are failing in Wales and, quite rightly, it has used them from time to time, so I see no reason why the Silk commission should not look realistically at the possibility of removing powers from the Welsh Assembly in devolved areas if standards have clearly dropped below those that all in the United Kingdom are entitled to expect.
Another area that I suspect the Silk commission will not look into—the right hon. Member for Neath (Mr Hain) mentioned it—is environmental taxes. To my mind, that would be very interesting indeed. As the right hon. Gentleman rightly said, Tata and other manufacturing companies in Wales that use large amounts of electricity are very angry about the way in which the environment has been used as a means to impose all sorts of extra tax burdens. The issue of the environment is worth exploring, but now is not the time or place—[Hon. Members: “Come on.”] It is very tempting, but I see Mr Deputy Speaker imperceptibly shaking his head at me. It is not for me to pose the question of why the temperature has not got any hotter since 1998, despite the fact that large amounts of carbon dioxide have gone into the atmosphere. That is not a question for today, but it is a very interesting one none the less—and I have never heard a satisfactory answer to it.
Let me move on to a more important question. If we accept that things will at some point start getting hotter because of carbon dioxide, requiring us to put all sorts of taxes on our industries, and if Welsh industries such as steel are affected, surely it is only right that those taxes be applied not just across the whole of the European Union or Europe but across the whole world. If we do not insist on that as a starting point, all that will happen is that those manufacturing industries—so important to us in Wales for jobs—will simply relocate to other parts of the world where those taxes are not being applied. It will not make a jot of difference to global carbon emissions, which will continue to come from wherever those factories relocate, but it will make a difference to jobs and the amount of tax that the Treasury collects within the UK. I would love to see the Silk commission looking into that idea, but I am afraid that I shall probably be disappointed.
You might conclude, Mr Deputy Speaker, from what I am saying that I am in some way against devolution—[Hon. Members: “No, never!”] I am not. I am devo-realist. I was against the idea of a Welsh Assembly and I have voted no at every opportunity ever since, but I say genuinely that I have a very high opinion of the abilities of the individual Members of the Welsh Assembly. I had the pleasure of working with them for eight years. I do not doubt their motives. I do not doubt the credibility of people like Rhodri Morgan, Dafydd Elis-Thomas or Nick Bourne, even though I might disagree with them on many fundamental issues.
My problem with what we are doing is very simple. The West Lothian question is the elephant in the room here. Every time we give further powers to the Welsh Assembly, we are weakening the United Kingdom. I believe that even some Labour Members, in their quieter and more reflective moments, share some of these concerns. Surely the priority for us constitutionally should not be thinking about granting further powers to the Welsh Assembly, but ensuring that all citizens of the UK have the same constitutional powers. The issue is about addressing the fact that we here in the Westminster Parliament vote on how the English run their schools, discuss how the English run their hospitals, yet we do not accept the right of anyone, including Members of Parliament, to have any say in how these issues are dealt with in Wales.
Jonathan Edwards
May I take it from the hon. Gentleman’s comments that he is arguing for a fully federal United Kingdom, whereby all the historic nations of the UK are treated on an equal basis?
David T. C. Davies
The hon. Gentleman is right. I have made that view public in the past. I think there is a strong case for looking at some form of English Parliament or some means to prevent Welsh and Scottish MPs from voting on matters that affect only England. I repeat that I have already made that viewpoint public. I do not pretend to know the exact answer, but I am in favour of something along those lines. It might well be that at that point, we would have to consider increasing the powers of the Welsh Assembly in line with those of the other parts of the United Kingdom. The hon. Gentleman will know, however, that that is something that happens in many countries across the world—in Canada, Germany and countries with a Commonwealth tradition such as Australia, for example. If that is thought through properly, it can work. My current difficulty is with the asymmetric nature of our arrangements. Giving further powers to Wales in this way—through the Silk commission if that is what it decides—is going to make them even more asymmetric.
Jonathan Edwards
Does the hon. Gentleman not recognise that currently local authorities in Wales can borrow and raise their own revenue, so what is the difference?
David T. C. Davies
They can only do so under fairly strict terms of engagement. There is no major difference, but what I am saying is that I do not want any more bodies to be able to do that. I certainly would not welcome the idea of the Assembly doing what Westminster Governments have done before—let us be honest about it—which is wait until a general election is coming along and then suddenly borrow billions of pounds on the international markets knowing that not many people understand the difference between debt and deficit, and are therefore unlikely to be able to work out the probable consequences of what is happening. Governments buy themselves elections in that way. I do not want to put that temptation in front of Members of the Welsh Assembly.
Finally, I am even more concerned about the idea of a separate judicial system for Wales. That would be costly and complex.
Guto Bebb
The hon. Gentleman is mixing up the question of fiscal changes, which is what we are discussing, with the issue he raises about GP surgeries. The fact that Northern Ireland has an uncompetitive tax regime compared with that of the Republic of Ireland is a huge political issue, and it is also well known that the republican factions in Northern Ireland have financed themselves through smuggling operations because of the different rates of duty on petrol.
I do not want to overstate this issue, but we should take it seriously. I am sure that we can successfully address it, and the Silk commission has been set up precisely to examine such matters. Members of Plaid Cymru often refer to the Holtham report as a document that is beyond criticism, and it highlights this issue in some detail. I think the Silk commission needs to look into it and come to a conclusion.
On fiscal responsibility, I was intrigued by an article in today’s edition of The Western Mail. I do not read The Western Mail often—after all, I am a north Walian, and we tend to read the Daily Post up in north Wales—but in that article it appears that the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) said that he did not support fully devolving fiscal responsibility and tax-raising powers to Wales at this point in time, as he thinks that would be inappropriate.
Guto Bebb
I agree with that; I think it would be inappropriate. We know that there is a huge funding gap between the amount of money raised in taxes in Wales and the public expenditure in Wales. I would therefore ask the hon. Gentleman whether he disowns the policy of his party, which is to call for independence—a policy that I am pleased to say the party never advocated when I was a member of it.
Jonathan Edwards
I thank the hon. Gentleman for his courtesy in giving way. As a former Member of my party, he will know that independence for our country is an aspiration, but that does not mean that we want it tomorrow. One reason for gradually devolving fiscal powers is to empower our economy to be strong enough to achieve that ambition.
Guto Bebb
That is an interesting clarification, which is contradicted somewhat by an article by one of the Plaid Cymru leadership contenders that appeared in the Daily Post last week, and in which it was stated that the constitutional aspiration of the party of Wales was clear. It was not a very clear statement, I thought.
Guto Bebb
I am not sure whether the most significant change would have to be in income tax. There is an argument for changing the rates of employers’ national insurance contributions, which could be beneficial from a Welsh economic perspective. Whether the changes require a referendum depends on the range and the outcome of the Silk commission. I would not want to commit myself on that at this point in time.
The concept of fiscal responsibility is something that everybody in Wales should welcome. I find it difficult to understand how anybody in this Chamber who believes that the Welsh Assembly should have a degree of accountability to the people of Wales can be opposed to the concept of fiscal responsibility. I look forward to the findings of the Silk commission on part I. I believe that they will contribute to the debate. It is crucial that all stakeholders in Wales contribute to this debate, because otherwise we will end up with a discussion not dissimilar to what the hon. Member for Monmouth described.
Finally, part II deals with constitutional changes and what further boundaries we need to consider, beyond the changes that have already been made. It is important to state that we are talking about boundaries within policy areas, not physical boundaries. Several individuals I know who live in Oswestry are slightly concerned about the comment that we are looking to change the boundaries. Personally, I would be delighted to welcome back Croesoswallt—or Oswestry—to Wales, but I do not think that that is the intention of the Silk commission.
When we talk about boundaries, we are talking about whether there are aspects of the relationship between the responsibilities of the Assembly and those of Westminster that we need to look at again. As has been said, matters such as transport are not fully devolved. That may be a good or a bad thing, but the main arteries going in and out of north Wales and south Wales go from east to west. Therefore, if there were improvements to the A55 in Flintshire they would be wasted unless there were improvements to the M56 in Cheshire. There are clearly transport issues that need to be examined. We have also spoken about the fact that health is not fully devolved.
Finally, we need clarification on energy policy. The opportunity for economic and employment growth in Wales as a result of large-scale energy projects is something that we should all welcome. However, there is confusion over whether permission for such projects is granted by the Welsh Assembly or Westminster. Businesses looking to invest in hydro, wind power or tidal power need clarity about where the permission comes from and where the responsibility lies. That would be beneficial to the Welsh economy. I sincerely hope that that will be considered as the Silk commission moves on to part II.
Jonathan Edwards
I thank the hon. Gentleman for giving way again; he is being extremely generous. He will be aware that his party and the Lib Dems fought the National Assembly election in May on the basis that they would extend energy consenting powers. Does he agree that it is a disgrace that the UK Government down here are ignoring those pledges that were made to the people of Wales less than six months ago?
Guto Bebb
I again thank the hon. Gentleman for his contribution. This is a difficult subject. There is clearly a need for clarity for the business community. Having said that, I would be extremely concerned if I was a resident of Anglesey who supported the new nuclear power station and the issue was completely devolved to the Welsh Assembly, which has a pathological hatred of anything nuclear. Clearly this is an issue that needs to be examined. The point that I am making is that the Silk commission will allow us the opportunity to consider this subject in detail.
Ultimately, what we do have—this is probably why the shadow Secretary of State was so churlish in his response to the announcement of the Silk commission—is a coalition Government who are willing to consult on a cross-party and non-party basis, and to talk to the people of Wales about the way in which Wales should be governed in the future. The Silk commission is being established to try to create real accountability for the Welsh Assembly, and in particular, it is examining the way in which some devolved areas need to be considered again to ensure that we have a settlement that works for Wales. I am astounded that any Opposition Members would oppose a consultation process.
Alun Cairns
I am grateful again to my hon. Friend, who highlights an important point. The hon. Member for Pontypridd (Owen Smith) looked on favourably when the Welsh Development Agency was mentioned, and so many businesses in Wales would love to see it returned.
We heard from my hon. Friend the Member for Worcester (Mr Walker) earlier. When his father was Secretary of State for Wales, Wales attracted 20% of the UK’s inward investment with just 5% of the population. How great it is to have another Walker family member showing such an interest in Wales. That is the difference—from the time in the ’80s when those jobs were being created and the economy was being restructured, to the failure that we have seen over the past 13 years. I also seem to recall the right hon. Member for Neath (Mr Hain) questioning the judgment of the then First Minister, Rhodri Morgan, in seeking to abolish the WDA and bring it into the Welsh Assembly Government.
Those differences are similar to the differences today between Labour Members at Westminster and Labour Members in the Welsh Assembly, who are far more enthusiastic about the Silk commission. Indeed, it is quite obvious that Labour Members here are in an uncomfortable position on Silk. They do not know how to react, and the shadow Secretary of State for Wales, in today’s article in The Western Mail and in his response to today’s debate, has tried to position himself by thinking, “How can we get out of this with some sort of political advantage?”, rather than recognising that Assembly Members need to be more accountable for their policies.
I have listed the failed policies and, ultimately, the one on the economy, and we could go on to health, cancer care or any others that I have mentioned, because Opposition Members need to accept and recognise their part in that failure, rather than simply looking up the M4 and blaming everyone else when they quite honestly know that they are responsible.
Many Members have referred to the need for engagement, and I cannot underline that point enough. Advocates of devolution point to the outcome of the recent referendum, when 63% voted in favour, yet the turnout was only 35%, which demonstrates that a significant number in the population are not engaged. The key challenge for the Silk commission and the Welsh Government is to capture their imagination, hear their concerns and get them involved, because, troublingly, the views of anyone sceptical of devolution are almost dismissed, and I suspect that they largely make up the 65% of people who did not vote at the time.
Jonathan Edwards
The hon. Gentleman is using, as did the hon. Member for Aberconwy (Guto Bebb), the turnout for the referendum as a battering ram to try to hold back the whole process. The referendum was fought on an extremely technocratic question, and I was amazed that more than 30% of the people of Wales voted on a question that hardly anyone understood.
Alun Cairns
I am surprised at that intervention, and the low sights that the hon. Gentleman sets for himself. He was amazed by a 30% turnout. That almost sounds as though he was delighted with it. If that had been the case in the referendums in Scotland and Wales back in the late ’70s, they would have been dismissed.
There is a need for engagement on the issue. I do not for one second use the low turnout as a reason to batter devolution, but it underlines the fact that many people throughout Wales and in almost every local authority area—ironically, the highest turnout was in Monmouth, at 50%—are troubled about devolution or do not understand it. Their views are as important as those of the strongest advocates, who I suspect are within Plaid Cymru.
Mrs Laing
I appreciate what the hon. Gentleman is saying. I do not believe that we should have a needs-based formula. I would always argue that the Barnett formula distributes taxpayers’ money in a reasonable manner, even though it obviously needs to be reformed and brought up to date. Just as Newcastle does not require the same sort of taxpayer subsidy as Surrey, and just as the centre of Birmingham does not require the same amount as the leafy lanes of Kent, so it is important that we get the balance right in Scotland and Wales.
Jonathan Edwards
Does the hon. Lady recognise that London gets a higher percentage of public expenditure per head than any other part of the British state, including Wales?
Mrs Laing
Of course, because some areas of London are desperately in need of help from taxpayers’ money. There are enormous areas of poverty, deprivation and need in London; that is why it happens. Of course it does. If the hon. Gentleman is not willing to be fair to people who live in London, why should the rest of the country be fair to his constituents?
That brings me to the other points made by the hon. Member for Pontypridd and the right hon. Member for Torfaen. Although I would argue that the distribution of taxpayers’ money is currently done fairly, the democratic balance between different parts of our United Kingdom has not, until now, been fair. It is totally outrageous that the hon. Member for Pontypridd should describe as “shameless gerrymandering” the equalisation of constituencies. In what way is it democratically fair that Pontypridd has 58,000 electors, Torfaen 61,000 and Neath 57,000, while the Secretary of State’s constituency has 70,000 and mine has 72,000?
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
I am very grateful, Mr Deputy Speaker. I have curtailed my speech a fair bit because of the time constraints, but I am not too upset because most of it was trailed in The Western Mail this morning. I have no idea how it got there, but perhaps it was lucky that it did.
This is a timely debate and I congratulate the Secretary of State on securing this time on the Floor of the House, because the nature of the British state is clearly changing. The strength of the yes vote in March has given huge momentum to the growth of the political autonomy of our country. Events in Scotland, with the historic victory of the Scottish National party in May, mean that there will be a referendum in the next three or four years on independence for Scotland. I am not a betting man, but I know where I would put my money if I was. There will be serious repercussions for the British state. We know that it will be a multi-option referendum. Even if the SNP does not win the referendum, and I am increasingly convinced that it will, there will be a devolution-max settlement.
There is currently a dual process on the funding of Wales with the Silk commission and the bilateral negotiations on the reform of the funding formula. It is important that we have progress on the latter as we discuss the former, and that the debate is as open as possible. Three parties are included in the debate on the important issue of Barnett reform: the Labour party, which leads the Welsh Government, and the Lib Dems and the Conservatives, who lead the UK Government. We have been excluded. The information on that debate needs to be open and we need to hear about its progress before we start talking about the fiscal measures that the Silk commission will address.
My party fully agrees with the points made by the Secretary of State and Tory Back Benchers about accountability. Before I came to this place, I served as a town councillor in Carmarthen. We were responsible only for very local matters, but we had taxation powers. For the life of me I cannot understand why anybody would oppose giving the Government of Wales similar powers, as this would, not least, focus the minds of Assembly Members on wealth generation, which is very important. If we are serious about creating a more prosperous and just society, we have to focus on wealth generation, as do the Welsh Government. Giving them tax-raising powers would make them focus more on such issues and on some of the give-away processes that we are seeing at the moment.
Taxation powers and borrowing go hand in hand, and I am grateful that the Silk commission will be able to look at borrowing powers. In a situation where we will have a varying income stream as a result of having taxation powers, borrowing is the best measure for smoothing out those differences, and it is right and proper that the Welsh Government will be able to have those powers if the commission so recommends.
We know that there are two phases to the commission, the first of which will examine taxation powers. We have been scouring the world for best practice in federal states, and I do not think that there is anything new about what is on the agenda. There are many examples from across the world that we could use to best effect in Wales. Any submission that my party gives will be a compromise, because clearly our policy is for the devolution of all taxation matters ultimately. However, we will be trying to engage with this process constructively and we hope that parties from across the spectrum will engage in the same manner.
The second phase of the commission will examine further areas of power. The Parliamentary Voting System and Constituencies Act 2011 has given added momentum to this, because we know that we will lose a quarter of our Members of Parliament. Unless further areas of power are devolved to the Assembly there will be a democratic deficit, because there will be fewer Members scrutinising decisions made on Wales. We argued during consideration of that Bill, with those on the Labour Benches, that it was not proper to cut the number of Welsh seats based on the referendum result. All the referendum did was enshrine sovereignty over current devolved matters. I still hope that Lib Dem colleagues might rebel when the matter comes back to the House and I might be able to keep the constituency of Carmarthen East and Dinefwr. If not, and if my fantastic constituency and the fantastic constituency of Arfon disappear into the annals of history, further fields of power need to be devolved to the Assembly to avoid that democratic deficit.
My last point relates back to my intervention on the Secretary of State. I was grateful to receive a very detailed response, as I did not think I would. If there is a consensus on the commission between the political parties and among civil society, there needs to be a clear process map to make the recommendations become law.
Oral Answers to Questions
Jonathan Edwards Excerpts(13 years, 5 months ago)
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Mrs Gillan
I thank my hon. Friend for reminding us that there are not always cuts in public sector jobs. In some instances, there is recruitment to public sector jobs. I congratulate his chief constable. I regularly meet the four chief constables in Wales, and they are all very positive about their forces and their operations protecting the public in Wales.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Does the Secretary of State share my concern about the report leaked last week indicating that seven out of eight HMRC offices in Wales are to be closed, leaving only one in Cardiff, with a loss of more than 1,000 jobs?
Mrs Gillan
The hon. Gentleman should know that I met HMRC earlier this week to discuss the reports in the press. I am pleased to say that there are no new announcements of HMRC office closures or moves in Wales at this time. HMRC has assured me that any office closures will not lead to job reductions beyond those already required by the spending review and that there are no plans to reduce the number of HMRC offices in Wales.
Constitutional Reform (Wales)
Jonathan Edwards Excerpts(13 years, 6 months ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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Chris Evans
That leads on to my final point about the policy overall. Perhaps I can look at the issue from a wider angle and step outside Wales for a moment, if you will allow me, Mr Davies. We are a nation state, and what seriously worries me about this exercise is that it is based on figures rather than communities. In that respect, I am glad that I followed my right hon. Friend the Member for Torfaen, because he knows about the situation in Northern Ireland, where wards and constituencies must strike a fine balance and could cause major problems. However, we have had no scrutiny of any kind, so these issues have not come out.
The coalition has hung on to its belief that people distrust politicians, but when people voted no for AV, they dispelled the myth that it was constitutional reform that we needed; we actually need to reconnect with people. Forcing through the proposed changes will mean more disconnect and people being more removed from politics, and that is a dangerous game. I therefore finish by paying tribute, as I did at the beginning, to the Welsh Affairs Committee, which is the only Committee to have looked at this issue properly.
Philip Davies (in the Chair)
Order. Two more Members are seeking to catch my eye. I intend to call the Front-Bench spokesmen at 3.30 pm, so if Members could show some restraint, that would be helpful.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
It is a pleasure to serve under your chairmanship, Mr Davies. The hon. Member for Islwyn (Chris Evans) is always a tough act to follow. I was hoping to make a hard-hitting speech, but I fear that my contribution might be somewhat timid in comparison with his. I want to concentrate on two specific issues. The first, on which all parties in the House have concerns, and which has been the focus of the debate so far, is the number of MPs who serve the people of Wales in Westminster. The second is the opportunities that the proposed Calman Cymru process may offer democracy in Wales.
Let us be in no doubt that the reason why the UK Government have introduced their proposals to cut the numbers of MPs from 650 to 600 is purely partisan. In nullifying the Celtic bias, the Prime Minister’s aim is clearly to enhance his electoral prospects at the next general election. We should ignore the spin surrounding equal-sized constituencies: if they undermined the Tory party’s electoral prospects, they would not be on the table.
I must admit that it is strange, as some Labour Members said in their contributions, that these changes are being introduced by the Conservative and Unionist party. Reducing Welsh representation in this place by a quarter will inevitably severely undermine the influence of Wales in this Parliament. The Westminster Parliament represents four distinct nations, and its make-up has always reflected that fact to avoid it becoming dominated by English representatives. Central Lobby, with its murals of the patron saints—St David, St Andrew, St Patrick and St George—is a reminder of the historical role played by the Westminster Parliament.
Many Members will undoubtedly be surprised to hear me make such points, because there will be no Welsh representation here at all if Plaid Cymru’s ultimate aim is achieved. However, as long as so many key political fields remain reserved, there is a role and a need in this place for Welsh MPs, and particularly Welsh Plaid Cymru MPs. [Interruption.] I am glad to see some Members nodding.
David T. C. Davies
I am grateful to the hon. Gentleman for making such an important point, which I fully agree with. For as long as Wales remains part of the United Kingdom, he and other Welsh Members should of course be allowed to take their places here. In the same way, people who did not agree with devolution or the Welsh Assembly, and who still have questions about it, have every right to sit in the Welsh Assembly if they are elected to it.
Jonathan Edwards
I am grateful for that, and I will stick the hon. Gentleman’s endorsement in my next leaflet.
I am not against reducing Welsh representation in the House of Commons as a point of principle. However, any reductions should take place only after the devolution of political fields of responsibility. I do not, therefore, accept the argument that the successful March referendum justifies reductions in the number of Welsh MPs. The referendum did not devolve extra fields of power, but merely secured sovereignty over currently devolved fields. If we were to have the same devolved fields of power as Scotland, however, I would see the case for reducing the number of Welsh MPs.
For the remainder of my speech, I would like to concentrate on the UK Government’s proposed Calman process for Wales and its constitutional implications. I seriously hope that the Wales Office is not proposing a rerun of the Scottish experiment, which was a stitch-up by the Unionist parties and has now backfired spectacularly. The government of Scotland Bill that followed the Scottish Calman process lies in tatters because of the Sewel convention. There is no way the majority Scottish National party Government in Scotland will accept a Bill that totally ignores their views on the way forward for their country. I therefore hope that the Calman Cymru process will be fair, open, transparent and free from political influence.
To date, much of the debate surrounding the Welsh Calman has been about finance. The Holtham report is unlikely to be bettered, so the best course of action for the UK Government would be to accept its detailed recommendations. Reform of the Barnett formula should be a precondition for any further financial changes, but I am concerned at the noises that have come from the Treasury to date. That will be a major challenge for the new Welsh Government, and all their rhetoric about standing up for our country will be seriously tested on this single issue.
However, I welcome the fact that the Calman Cymru process will reopen debate about the Government of Wales Act 2006. In particular, we will have the opportunity to revisit the gerrymandering carried out under the Act by the then Labour Government in Westminster. The section introduced in 2006 to prohibit candidates from standing in regional lists and constituencies should be overturned. A similar ban exists only in Ukraine, and it is high time that we in Wales joined the rest of the democratic world.
The Calman Cymru process is also an opportunity to revisit the electoral make-up of the National Assembly in time for the fifth Assembly. My personal preference would be for us to increase the membership of the National Assembly to 80, as advocated by Lord Elystan-Morgan. Those 80 Members should be elected by a single transferable vote system. When the government of Wales Bill, which follows the Welsh Calman process, comes to this place, I will call for amendments to that effect, unless such provisions are already included in the Bill.
Jessica Morden (Newport East) (Lab)
Does the hon. Gentleman think that there is any appetite in Wales for yet another prolonged period of navel-gazing?
Jonathan Edwards
I am grateful for that intervention, but we have the Calman process and, following questioning last Wednesday, it was confirmed that such issues will be debated. The Bill will be an opportunity to address grievances that some of us have with the current settlement.
Paul Murphy
I am following the hon. Gentleman’s arguments with great interest. I agree with some of them, but I am doubtful about the appetite in Wales—or the UK, for that matter—for introducing any other systems of proportional representation. It is daft to argue that the overwhelming vote against AV was because people wanted STV. People want a first-past-the-post system, so would it not be a good idea to have 60 or 80 AMs elected, two per constituency, by first past the post?
Jonathan Edwards
I totally disagree with that, of course. When the Parliamentary Voting System and Constituencies Act 2011 was a Bill before the House, I argued for the referendum to be held on STV, not AV. That was about a vote for the Westminster Parliament, and my preference for developing democracy in Wales is a plural, proportional system. I will get to that point when I conclude my speech.
During the passage of the 2011 Act, I welcomed the clauses that decoupled the Westminster and National Assembly boundaries; it was common sense to include them in the Act. My colleague the hon. Member for Pontypridd (Owen Smith) had a sparring session on BBC Radio Wales in the very early hours of Sunday morning on that issue. The Labour party was vehemently opposed to the decoupling; its preference was for coterminosity. From the point of view of organising local party structures, I can see the argument. They would be a total nightmare to organise locally with different boundaries for the Westminster and Welsh elections.
Nick Smith
It is not only about party organisation. Coterminosity is important for talking to borough councillors and chief executives, and the managers of local health services and housing associations. It helps us to make an impact as MPs with local civic society. Surely we should keep that.
Jonathan Edwards
I do not disagree with the hon. Gentleman. Coterminosity is favourable.
Given that, as a point of principle, Labour is opposed to decoupling and the Tories to PR, one way to achieve consensus might be to re-adjust the National Assembly boundaries to be coterminous with the new Westminster boundaries. Such a reform would have the added benefit of being more proportional. Diolch yn fawr iawn.