Scotland Bill
Lord McCluskey Excerpts(8 years, 9 months ago)
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The Advocate-General for Scotland (Lord Keen of Elie) (Con)
My Lords, before turning to the government amendments in this group, I should like to address some points that noble Lords have previously expressed in relation to Clause 2. This clause is to implement the provision in the Smith commission agreement that the Sewel convention should be put on a statutory footing. The Smith commission agreement did not suggest any change in the effect of the convention. The clause recognises that this Parliament will not normally legislate on a devolved matter without the consent of the Scottish Parliament, but the convention recognises that the decision whether to legislate is for this Parliament to take.
I have noted the points made by noble Lords who have made clear in previous discussion of this clause their view that the word “normally” is not a word sufficiently precise for a statutory restriction. Of course, we are not seeking, and nor are we able, to impose a restriction on parliamentary sovereignty, and it has also been made clear in discussion that the word is suitable for indicating how a discretion will be exercised. This clause is clearly intended to indicate that the discretion of Parliament to legislate for devolved matters will continue exactly as before and that it is not intended to subject that discretion to judicial control. I would add that the words “it is recognised” that appear in Clause 2 also reflect the continued sovereignty of the United Kingdom Parliament and that it is for Parliament to determine when a circumstance may be considered not normal. This is not a matter that the courts could meaningfully engage with.
I turn to a number of technical amendments that we have tabled to Clauses 3 and 5 of the Bill. Noble Lords will recall that we gave notice on Report that we would table these amendments, which are necessary to ensure that the clauses in the Bill relating to elections work as intended. Under the Bill, and in line with the Smith commission agreement, the timing of Scottish parliamentary elections is devolved to the Scottish Parliament, subject to the provision that Scottish parliamentary ordinary general elections may not be held on the same day as a UK parliamentary general election, a European parliamentary general election or ordinary local government elections in Scotland. We have tabled amendments to Clause 3 to improve the drafting of the part of the reservation relating to the timing of ordinary local government elections in Scotland. These amendments do not change what is reserved, but rather clarify the drafting to ensure that the reservation achieves the intended outcome—that an ordinary local government election in Scotland may not be held on the same day as ordinary general elections for the Scottish Parliament.
In addition, we have tabled amendments to Clause 5 of the Bill to improve the drafting of the new provisions to be inserted into Section 43 of the Representation of the People Act 1983. These provisions relate to the reservation of the timing of ordinary local government elections where they clash with the date of an ordinary general election to the Scottish Parliament, and provide a mechanism for the Scottish Ministers to change the date of the local government elections where such a clash occurs. The amendments improve and clarify the drafting of the provisions providing a mechanism for setting an alternative date.
Amendments 3 to 9 are technical amendments, which will ensure that there is clarity in the clauses in the Bill relating to elections and that they operate as intended. I beg to move.
Lord McCluskey (CB)
My Lords, I accept that Amendments 1 and 2 could not be moved, and will not be moved by me or by the noble and learned Lord, Lord Wallace of Tankerness. However, in the light of the Minister’s statement, I make a brief comment. It sounds to me very like a Pepper v Hart type of statement, designed to guide a court, when a court sits down to decide on an ambiguity in the interpretation or application of the provision. I am not at all sure that it will work, but it is no doubt the best that the Minister could come up with, even with the assistance from behind him of the noble and learned Lord, Lord Mackay of Clashfern, who is unfortunately unable to be here today. It does not solve the problem, but it is better than nothing.
The very fact of making the statement appears to be to concede the point that we were all making, that the provision in the clause is just a shibboleth, because Pepper and Hart statements have no locus at all unless in a court of law when a statement is invoked to assist the interpretation. However clear the statement is, it is not binding on the court, which has a duty to apply the words of the statute to determine what it means. However, I welcome it, while regretting that the Government did not pick up on the amendment proposed by the noble and learned Lord, Lord Wallace of Tankerness, which would have solved the problem within the statute itself, and we would not have needed this. However, in the light of the Government’s attitude, we have to leave it there.
Lord Wallace of Tankerness (LD)
My Lords, following on from the noble and learned Lord, Lord McCluskey, it was with some considerable regret that I agreed not to move Amendment 2, part of which I shall come back to in a moment. I welcome the Minister’s statement as far as it goes, which is not very far. I agree with the noble and learned Lord, Lord McCluskey, that it is an attempt at a sort of Pepper v Hart statement, but I make two observations on that. First, for Pepper v Hart to come into play, there has to be an ambiguity that has to be resolved. If, in fact, there is no ambiguity—and I am not sure whether the absence of something that has been debated in Parliament and expressly rejected by the Government could amount to an ambiguity as they have made it very clear that they do not wish for Devolution Guidance Note 10 to be part of what is on the statute book—I am not sure that Pepper v Hart would come into play.
Lord McCluskey
The noble and learned Lord talked about the likelihood of litigation. Is he aware—I am sure he is—that the Human Rights Act itself is extremely productive of legislation at all levels of our courts in Scotland and elsewhere? Therefore, if the Government proceed with their intention to introduce a domestic human rights Act, and that has a direct effect upon the Scotland Act and the Human Rights Act in Scotland, then there is bound to be litigation that in turn will raise the question of the meaning of this so-called clause.
Lord Wallace of Tankerness
As I said, these are not academic issues but very real ones. The Human Rights Act could certainly give rise to them as indeed could measures in the Trade Union Bill. They would not necessarily be issues between Governments; they could be issues that impacted on other public bodies in Scotland, for example. That is why it is regrettable that the Government have not been more forthcoming and willing to look at the proposals that we want to put on the statute book.
Lord McCluskey
“The Barnett Formula
Within 30 days of the date on which this Act is passed, the Secretary of State shall publish as a memorandum, supplementary to the agreement between the Scottish Government and the United Kingdom Government on the Scottish Government’s fiscal framework, a document containing a full description of any agreement reached between the governments relating to the future of the Barnett Formula or its application, amendment, reassessment or replacement in the future, including any agreement as to when any such change is intended to be considered by the two governments in the future.”
Lord McCluskey
My Lords, I promise to be brief. I have been in this House just short of four decades and I have noticed that the easy way to empty the House at the end of Oral Questions is to read out the name of a measure that contains the word “Scotland”. In raising the matter that the amendment raises, I also realise that, to get a collective groan from around the House, the words “Barnett formula” are a pretty good start.
I do not want to repeat any of the arguments made. My one purpose in raising the amendment, which I think speaks for itself on what it seeks, is to assist the people of Scotland to understand the truth of the manner in which Scotland’s public expenditure is to be financed following the arrangements made under the fiscal framework. I do not think that very many people in Scotland have grasped what has happened. Indeed, there has been no opportunity to discuss the matter in the other House before the Bill is passed. My only purpose in moving the amendment is to encourage the Government to produce a publication of the kind requested that shows the truth of that financing so that we can all go out, talk about it explicitly in the face of the superb SNP propaganda machine, which feels no obligation to tell the truth, the whole truth and nothing but the truth.
I would have sat down at that point, but because the Minister has made some general remarks of a kind that would normally have been made, in my early days here, on the Motion that the Bill do now pass, I simply say that I am unhappy with the Bill. It subordinated the United Kingdom Parliament to a group of 10 Members of the Scottish Parliament, who took eight or nine weeks to produce a document. Since May last year we have been obliged to spend our time implementing the Government’s version of that document. I do not think that all the proposals in the Smith commission report were fully thought through and, of course, Ministers in this House were plainly given a brief to accept no amendments. They did particularly well in dealing with that difficult brief, but I do not think that their position was a very sound one.
One of our purposes was to give the other House an opportunity, before the Bill passed into law, to discuss the fiscal framework. I repeat what the noble Lord, Lord Forsyth, often said, which is that the other House should have been given that opportunity.
Lord McAvoy
I am sure that the noble and learned Lord will recall, in speaking about the role of the United Kingdom Parliament, that my noble friend Lord McFall of Alcluith suggested that the Government should deliver annual reports to both the UK and Scottish Parliaments on the progress of the fiscal framework discussion and the devolution settlement in general. This was surely an important development.
Lord McCluskey
I shall conclude by saying that I acknowledge that that is exactly correct. It was an extremely worthwhile proposal and I am thankful that, one way or another, as the months and years pass by, we will be able to get the whole truth out about what has happened in relation to this settlement.
Lord Higgins (Con)
My Lords, the noble and learned Lord, Lord McCluskey, says that he has been involved in these matters for some 40 years. I have been involved, at one end of the building or the other, for 50—33 at the other end and 18 or so at this end—dealing to a large extent with financial and Treasury matters, but I have to say that I cannot recall any financial issue, in either House, that has been dealt with in such an inadequate way as the legislation that we have in front of us. The fiscal framework, which is at the heart of the Bill, has still not been debated at all in the House of Commons. We had a very truncated debate in Committee, with no debate on the fiscal framework, and very limited debate thereafter.
The Minister referred, in the debate on the previous group, to the promises made in the course of the referendum campaign. He described them as joint promises, but they were made, of course, with absolutely no consultation. The so-called vow was made during the referendum campaign and the statement by the Prime Minister was made the morning after the referendum took place. The deal that has been struck perpetuates a grossly unfair balance for those paying taxes and involved with financial matters in England, Wales and Northern Ireland and perpetuates the very substantial subsidy that is given to Scotland. Members of Parliament have not had any opportunity whatever to debate this. One must hope that their constituents will hold them to account when the details begin to sink in to the consciousness of the public at large in the parts of the United Kingdom other than Scotland.
The noble and learned Lord’s amendment is very much to be commended. We are stuck with the Barnett formula, which we all know the late Lord Barnett himself decided was obsolete long before his lamented departure. The reality is that we are now going to go on doing this with virtually no prospect of the matter being changed again in five years’ time or beyond. That is a dreadful situation as far as taxpayers in the rest of the United Kingdom are concerned. I certainly support the noble and learned Lord’s suggestion that we at least ought to know the details of what has been agreed.
Lord McCluskey
My Lords, I can be brief indeed. I am encouraged by what the Minister has said. Indeed, I have been encouraged by the remarks of other noble Lords who have supported me. The noble Lord, Lord Selkirk of Douglas, mentioned the concept of responsibility. I believe that it is our responsibility, having been fortunate enough to be here and to be informed about the details of what has been happening, to use what influence we can in Scotland, and indeed in the rest of the United Kingdom, to make known the truth about all the circumstances surrounding this settlement. I shall do my best. In the mean time, encouraged by what I have heard, I beg leave to withdraw.
Scotland Bill
Lord McCluskey Excerpts(8 years, 9 months ago)
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Lord Cormack (Con)
My Lords, following my noble friend Lord Higgins, I add my support for my noble friend Lord Forsyth. We are in danger of forgetting that this is, as the noble Lord, Lord Empey, said, a treaty between the sovereign Government of the United Kingdom and the Government of Scotland, who, we must recognise, are composed of a party whose sole raison d’être is the destruction of the United Kingdom. That is a perfectly legitimate view to hold, but that is the view it holds. We have here a document that, as my noble friend Lord Higgins has just said, is of enormous, far-reaching significance, and it has to be debated in Parliament in some detail.
In another context, a few weeks ago some of us remarked that Governments are accountable to Parliament and not Parliament to Governments. Here, the Government have come to an agreement and are expecting us to more or less put it through on the nod. It has very far-reaching implications. My noble friends Lord Lang and Lord MacGregor of Pulham Market have both made powerful, brief speeches indicating how vital it is that this matter be properly discussed.
It is the fault of no one in this Chamber that we have had to wait so late for this document. We have not had the chance properly to analyse it. It is full of extraordinarily vague statements and, at the end of the day, a review which will be entirely at the whim of the Government of Scotland, rather than the Government of the United Kingdom. I believe passionately in the United Kingdom, and equally passionately in parliamentary democracy. Neither is being served by debating this far-reaching document in such an unsatisfactory manner. I very much hope that, even at this late stage, my noble friend the Minister will acknowledge that each House of Parliament should have the opportunity to debate this document at some length. At the end of the day, it will probably be endorsed. But then, as my noble friend Lord MacGregor said, it will have been endorsed by Parliament and we will have a degree of responsibility for it.
This is a mess. It is a wholly unsatisfactory situation. We are deeply indebted to my noble friend Lord Forsyth for the calm and analytical way in which he spoke in moving his amendment, which deserves considerable sympathy and support.
Lord McCluskey (CB)
My Amendment 67A is in a different group but, with respect, because it deals with the Barnett formula it ought to be considered at this stage. It raises the general question of the formula, as did its predecessor, which contained a reference to the Government’s obligation to publish the Scottish fiscal framework.
The Barnett formula runs through the whole document—rather like dry rot in a south Edinburgh house I used to live in. It cost an awful lot to put that right, and I dare say it will cost an awful lot to get this right.
The noble Lord, Lord Forsyth, referred to getting the briefing. I saw the document on Friday, and I came to today’s very useful briefing with, like President Wilson, 14 points. However, I did not dare raise the 14 points because many people were anxious to speak and we had very limited time. I do not propose to raise them all now, and I am happy to note that many have been dealt with by others, but there remains one rather important one.
This Scottish fiscal framework is recognised by everyone as being fundamental to the whole Bill. The entire Bill rests upon the Smith agreement, which was reached in nine weeks. It took nine months to frame the fiscal framework. The Smith agreement was reached by 10 elected Scottish politicians—Members of the Scottish Parliament. They included representatives of the Labour Party, the Liberal party and the Greens, none of whom, as far as I can see, have been consulted at all about the Scottish fiscal framework, and certainly not in the formal consultations. It is a very odd situation. This document has been produced between the two Governments, after nine months, and it contains things that are simply not in the Smith agreement.
For example, we talk about “no detriment”. I never knew what it meant, and I am happy to say that I was not alone in my failure to understand. The committee of the House of Lords that looked at it could not understand the second detriment, and even the noble Lord, Lord Forsyth, for whom one has the highest regard, was not able to understand it. He asked in vain if anybody would explain it to him, and we are still waiting for an explanation. Now, the paper has come up with something that was not considered by the Labour Party, the Liberals or the Greens: division of detriment into direct detriment and behavioural detriment. Last week, we were told about not behavioural detriment, but indirect detriment. All those concepts have come up to fill out the notion of no detriment, which no one has yet been able to explain.
I want to pick up one or two of the points that have been made, just to show my support for the approach of the noble Lord, Lord Forsyth. Paragraph 7 of the document states that,
“the … block grant will continue to be determined via the operation of the Barnett Formula”.
That seems to fly in the face of what the noble Lord, Lord Lang, said, but that is what the document says. House of Lords paper No. 55, A Fracturing Union?, states:
“The Formula contains no mechanism to correct any unintended consequences being built permanently into the baseline”.
That surely means that Scotland continues to get the benefit of built-in unintended consequences for at least five years, and perhaps in perpetuity, given the remarks made by others about the arrangements at the end of the five years.
The document continues:
“For welfare … and … other spending”—
nothing to do with the Barnett formula, at the moment—
“the chosen method will be the Barnett formula”.
Does that mean that, in respect of the devolution of welfare payments, the block grant will be adjusted to give Scotland the benefit of the unintended consequences of the operation of the Barnett formula?
We talk about the unintended consequences, but it is entirely foreseeable—
Lord McCluskey
Forgive me—yes. The document that talks about the unintended consequences is the House of Lords document.
One thing is foreseeable: that the Scottish population will decline in relation to the UK population because, as the noble Lord, Lord McFall, pointed out, that has been the position for hundreds of years. In law, or certain branches of it, if you can foresee the consequences of your actions, you are deemed to intend them.
I do not want to go through all my 14 points, but I have the greatest difficulty in understanding paragraphs 15 to 19. I do not understand what is meant by “Income tax, 87.7%”—per cent of what? These things are rather difficult, and they are not explained. Not being an accountant, I am unable to follow entirely what is going on.
I repeat the point that was made a little earlier: if Scotland’s population declines in relation to that of the rest of the UK, the funding will not go down under this document. Funding per capita is bound to rise; that is just inevitable. So I do not see how we can have “no detriment” to Scotland without causing detriment to other taxpayers throughout the United Kingdom.
On a point of detail that I hope will be echoed by my noble and learned friend Lord Hope of Craighead, the courts and tribunals are dealt with in paragraph 28. There is no agreement, apparently, as to who is to pay for the Supreme Court. I am not sure whether it is regarded as a court in Scotland or a court in the United Kingdom. That is a small detail.
I have little more to say. However, I do not understand how the £200 million figure and others related to it can possibly be justified. They are certainly not justified within the document.
My other amendment relating to this issue concerned the independent scrutiny of these matters in Scotland. However, this is now going to be dealt with by a government amendment and I give notice that I will not seek to move Amendment 67.
Lord Hope of Craighead
My Lords, in view of the difficulties to which the noble and learned Lord has drawn our attention, does he agree that clarity and dispute resolution is absolutely crucial? This issue is ripe with areas that will give rise to dispute of various kinds and it cannot be left in a position where there is no mechanism for deciding them.
Lord McCluskey
My Lords, that was my 14th point. My notes state that the arrangements for resolution of these disputes read like the draft of a script for a BBC drama that would put “War and Peace” to shame.
Lord Campbell of Pittenweem (LD)
My Lords, I have been provoked to make a contribution arising out of the nature of the debate. I hope it is not a question of piling Pelion upon Ossa for yet another lawyer to offer what may be an obstacle. The right of judicial review may apply in circumstances where either of the two institutions makes a decision that does not pass the test of reasonableness. If there were such an application for judicial review in relation either to the conclusions or to the implementation of the conclusions of this agreement, that would certainly bring the validity of the agreement under considerable scrutiny.
Others have referred to the imperfect nature of dispute resolution. In the worst case the Supreme Court, which has just been referred to, could find itself engaged in these matters. That is more akin, of course, to a Supreme Court in the United States rather than the one we consider here. Therefore, there might be fundamental constitutional implications and unintended consequences from what is proposed.
The Earl of Caithness (Con)
My Lords, we are in a mess. It is a very sad occasion when you get a situation like this where the pass has been sold. What is most interesting about the debate is the number of Scots who are questioning this because it affects adversely the rest of the United Kingdom, and I add my name to that list. I have never before attended a debate in this House, in the many years that I have been here, which has involved so many Scots who are all on the same side against an agreement that is beneficial to Scotland. Let us make it absolutely clear: Scotland had a very good deal before the present devolution agreement and it now has an even better deal. It will rank as one of the great victories that the Scots have achieved over the English Government. It is the UK Government in this case, but as far as the Scots are concerned, it is the English Government.
At the meeting this afternoon my noble friend Lord Dunlop said that this is a significant agreement which provides the opportunity to end the blame game. Actually, nothing could be further from the truth. This will not end the blame game—the blame game will continue. All of us who have been brought up in Scotland know full well that whatever the UK Government concede to the Scots Government, particularly the Scots nationalist Government, it will never be enough. The blame will continue.
We have an interim agreement but a permanent agreement. The interim agreement has handed over the grenade, as the noble Earl, Lord Kinnoull, said, to go off five years or five and a half years down the road. No one is going to want to handle that grenade, and as the noble Lord, Lord Kerr of Kinlochard, said, it will be passed on again. So we have a false but permanent agreement which is of huge detriment to the rest of the United Kingdom.
Lord McCluskey
Perhaps the noble Earl will permit me to ask him a brief question arising out of what he has said. If those of us who reside in Scotland are going to benefit so much, as we all think we are, should we be declaring an interest in speaking in this debate?
The Earl of Caithness
My Lords, having recently moved from Scotland to London, I will leave that to the noble and learned Lord, but I would certainly declare an interest—not that the Scottish Government in Edinburgh are remotely concerned with what happens in Caithness; they are much more concerned with the central belt. I do not think that Caithness is going to benefit very much.
I raised at the meeting hosted by my noble friend this afternoon the question of the tangential consequences of the no-detriment principle. It was quite clear that the Chief Secretary thought that this was a grey area. Let us take the example mentioned earlier by my noble friend Lord Forsyth and myself, of air passenger duty and the Edinburgh-Glasgow axis against the Manchester-Newcastle axis. If consequences flow from that, they are going to be very hard to prove, and, quite frankly, as far as I could determine, the Chief Secretary was not terribly interested in them. But if they can be proved by one side, we then get into the question of the resolution mechanism. The lawyers in this House have clearly shredded the mechanism that is before us, so we are now in an even worse situation in that we have a mechanism that is not going to work satisfactorily from the legal point of view; that will be difficult to implement in the first place; and that could be highly prejudicial to the north of England and other areas in the rest of the United Kingdom.
I have some sympathy with my noble friend on the Front Bench. I have been in his position when the whole House was against me and the only people on my side were those who were sitting to my right and to my left. That is the situation today. However, I would ask him to take this away and try to implement something of what my noble friend Lord Forsyth has requested. Of course this has to be a political deal in the end, but it is one that the United Kingdom Government have lost and the Scottish Government have won.
Lord Sanderson of Bowden (Con)
My Lords, I strongly support Amendment 56L, produced by my noble friend. I consider the work of an independent fiscal commission to be vital for the future not just of the Scottish Parliament but of the whole United Kingdom in this new arrangement where so many powers are being devolved. I said at Second Reading that I believed the OBR was a great initiative of the coalition Government, and it was. I am pleased to see in Amendment 56L that, if the amendment is passed, the OBR will have access to the sort of information that it needs to help the Scottish Fiscal Commission come to the right conclusions. I am still smarting from the reports that came out from the SNP just before the referendum that oil was going to be $112 a barrel. If a Government in Scotland are to do their own forecasting and that is the sort of answer that we will receive, no one, but no one, will believe them.
The amendment moves the OBR and the Scottish Fiscal Commission closer together. I have seen a very useful letter from the Chief Secretary to the Treasury to, I think, the committee in the other place. This is what he said about what the committee had said:
“There is a clear consensus”—
that is, a consensus in the Scottish Parliament—
“that forecasting should be done by a body independent of government. We agree with the conclusions of the Finance Committee of the Scottish Parliament and recommend that an enhanced Scottish Fiscal Commission be made responsible for forecasting in Scotland”.
My question for the Minister is: how far has the Scottish Parliament gone in legislating in this matter? May I have an assurance that those words will come true and we will have a proper Scottish Fiscal Commission? A commission, of course, is only as good as its membership. Let us hope that its membership is very understanding and knowledgeable, because I believe this to be crucial to the future success of the new arrangements.
Lord McCluskey (CB)
My Lords, I am sorry that the Government were unable to adopt something more along the lines of my Amendment 67. The purpose of that amendment was to ensure that there was an independent Scottish Fiscal Commission, and the provisions in it were designed to achieve exactly that. However, I recognise that I could not possibly win a vote if I sought to move that amendment and divide the House.
The other point is that in substance, Amendment 56L does the job as well as one could reasonably expect it to. I am happy to support it in the circumstances and I will not move Amendment 67, but I have one modest question. The point is that subsection (1) of the new clause says:
“The Office for Budget Responsibility has a right of access at any reasonable time”.
Note the word “reasonable”. The next line says that it is entitled to ask for information,
“which it may reasonably require”.
New subsection (2) says,
“which the Office reasonably thinks necessary for that purpose”.
I am not sure how that operates, because it was well understood in law that the word “reasonable” was so elastic that it was not precise enough—for example, to found a conviction for not doing the reasonable thing if that is what the statute required you to do. Therefore I am not sure how this is to be policed. If the Office for Budget Responsibility asks for information in the way that is qualified by the word “reasonably” in this new clause, and if the Scottish Government do not agree with its assessment of reasonableness, how is that dispute to be resolved?
Scotland’s Fiscal Framework
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Lord Dunlop
I thank my noble friend for his words. We are months away from elections to the Holyrood Parliament and, as I said earlier, the deal opens the way to make sure that that debate is on the right terms—about how each of the political parties competing in that election will use those powers, and not the perpetual debate about what those powers are.
Lord McCluskey (CB)
At the risk of mixing my metaphors, although they will be well understood by all Members of this House, have we not, for the duration of this Bill, been burying our heads, ostrich-like, in the sand, while turning a blind eye to the elephant in the room? Did we awaken yesterday from our slumber to kick a hornets’ nest into the long grass where we hope that the English will not notice it and the Welsh will be ignored? I shall translate that for those who have not followed this debate. The elephant in the room is, of course, the Barnett formula. The hornets’ nest is also the Barnett formula because if anyone disturbs the Barnett formula, the hornets will fly out. The blind eye is the decision by tame Scottish politicians, supported by the UK Government, to continue Barnett without discussion of its inequities or its notorious unfairness, particularly to Wales. The long grass is the five or six-year period. The question simply is this: will the documents to be published now or in the next five years show clearly the extent to which the rest of the UK is contributing towards this expenditure by the Scottish Government?
Lord Dunlop
As I said earlier in answer to another question, there is no additional cost to taxpayers in other parts of the United Kingdom. We have had many debates in this House about the Barnett formula. There are many former Secretaries of State who, when they had the opportunity to get rid of the Barnett formula, did not do so. Indeed, some of those Secretaries of State take great pride in arguing for more resources for Scotland. They were very effective at doing it, and I pay tribute to them for that. However, when proposing a move away from the Barnett formula, with the idea that there is some easy solution that would do away with the hard negotiation that is required with the Scottish Government, I am at a loss to know why we would expect the SNP to fight Scotland’s corner any less strongly than former Secretaries of State did.
Scotland Bill
Lord McCluskey Excerpts(8 years, 9 months ago)
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Lord McCluskey (CB)
My Lords, I have simply one question to ask the Minister at this stage. Given the failure of the Government to respond positively to the submissions that were cogently advanced both in Committee and here today—the same, by the way, applies to many of the other amendments we discussed in Committee—is there some kind of agreement or understanding between the UK Government and the Scottish Government, perhaps as part of the fiscal agreement deal, to the effect that the Government will not allow any material amendment of the Bill in the course of these or subsequent proceedings? If not, I fail to understand how the Government have not advanced certain amendments which reflect the debate and the Government’s response in Committee to those amendments. I will refer to those particularly when we come to them.
Lord Empey (UUP)
My Lords, if I may follow the point just made by the noble and learned Lord, Lord McCluskey, I said in Committee that I believed the outcome of the Smith commission had the status of a treaty. I did not say that in any negative fashion, but I have seen all this before. Once these deals are done, we are going through the motions here. There is a political imperative: all the Front Benches signed up to whatever happened a week or 10 days before the referendum. What we have before us is the same procedure that flows from Europe, goes into the mixer in Whitehall and comes out as Smith-plus. That is where we are. It does not matter what the merits are of the amendments of the noble Lords, Lord Norton of Louth, and Lord Forsyth, or of any other noble Lord. The political decision has been taken and the Front Benches are paralysed, because they have reached a position, for political reasons. We know it, all noble Lords know it; the dogs in the street know it. That is where we are.
Lord McCluskey
Before the Minister moves on, may I ask just one question? In the earlier debate, I asked whether the words “the people of Scotland” included Andy Murray, the tennis player, and he could not answer. The noble Lord, Lord Norton of Louth, has suggested a simple amendment that would make it clear that the persons entitled to vote are not the people of Scotland—which is a slightly meaningless phrase—but those entitled to vote as electors in a local government election in Scotland. What is wrong with accepting that?
Lord Keen of Elie
As I indicated, we are dealing with an entirely hypothetical situation. Should that situation ever materialise, the terms of the referendum to be held would be determined according to the circumstances in place at that time. It would not be appropriate to anticipate the circumstances of such a referendum, which might be many millennia in the future. It is therefore left open in these terms.
I turn to the amendments moved by my noble friend Lord Forsyth of Drumlean. The points he has raised in them are those he made in Committee in December, and I assure him that we have continued to reflect carefully on the points made at that time. My noble friend has focused on whether Clause 1 impinges on the sovereignty of this Parliament. I thank him for his consideration of this point but must respectfully disagree that there is any question that it does. Constitutionally, the United Kingdom Parliament cannot bind a successor Parliament: the sovereignty of Parliament remains. The purpose of paragraph 21 of the Smith commission agreement, and of Clause 1 in the Bill, is not to change the constitutional position but to reflect in legislation the political understanding that already exists. The clause thus delivers the Smith commission agreement while respecting the United Kingdom’s constitutional arrangements.
Amendment 1 would reinsert the words “recognised as”, which were removed from Clause 1 by government amendment on Report in the other place. The Government have been quite clear throughout that there has never been any question that the Scottish Parliament and Scottish Government are anything other than permanent. However, we have listened to feedback on the clause, and it was felt appropriate to amend the clause to take account of the observations made. The criticism levelled at the clause was that the provision was weak. The Government have strengthened the provision to demonstrate the commitment of the United Kingdom Parliament and Government to the Scottish Parliament and to the Scottish Government.
Amendment 4, tabled by my noble friend, provides that the abolition of the Scottish Parliament and Government would have to be agreed by United Kingdom-wide referendum. The referendum provision in Clause 1 rightly reflects the importance of the people of Scotland in determining the existence of the Scottish Parliament. It is important to be clear that there are no circumstances under which the abolition of the Scottish Parliament and Scottish Government is envisaged. However, in responding to the points raised by my noble friend, I state that, in that entirely hypothetical circumstance, this Parliament would of course play its full and proper role, as I mentioned previously.
Amendment 5 would state in the Bill that Clause 1 does not limit the sovereignty of the United Kingdom Parliament. Again, I hope I have already sufficiently addressed that point. Clearly, the sovereignty of this Parliament remains, and is unhindered by the provisions. I therefore urge noble Lords not to press their amendments.
Lord Cormack
My Lords, I hope the occupant of the Woolsack will not to have to do that because I very much hope that the Minister will accept the irrefutable logic of the amendment moved by the noble and learned Lord, Lord Hope. My amendment 8 is very simple. I am most grateful to the noble and learned Lord, Lord McCluskey, for adding his name to it. When we debated similar issues in Committee the noble Lord, Lord Stephen, indicated that he supported this amendment. He has now got a rather ingenious substitute; he just puts quotation marks around “normally”.
It is very important that the Minister should heed the wise words of the noble and learned Lord, Lord Hope. We want clarity in this measure. In the previous debate, the noble Lord, Lord Empey, made an extraordinarily effective but rather cynical speech. I was tempted to get up, as my noble friend Lord Forsyth of Drumlean did, and say we are wasting our time. It really is a very unsatisfactory way to legislate that an extra-parliamentary body, with a prior commitment from leaders of parties to give it a blank cheque, then in effect tells Parliament what to do. From a constitutional point of view, it is an outrage that that should happen. In saying that, I am not making any personal political criticism of the noble Lord who presided over the commission or of any members of it, but for it to be given that unfettered power and then to come to Parliament with a Bill that is not really going to be changed at all is deeply unsatisfactory.
If the Minister cannot accept the admirable amendment from the noble and learned Lord, Lord Hope, I hope that at the very least he will accept that the word “normally” is fraught with all sorts of dangers. The question of what is normal and what is abnormal is justiciable and will be taken to the courts, so why have it in at all? Taking out that word and perhaps coming back at Third Reading with a slight extra clarification—even to substitute such words as “in the most exceptional circumstances”—would be better than just having “normally”. I honestly do not think that by accepting this amendment, or undertaking to come back at Third Reading with something similar, the Minister would be selling anyone down the river at all. It would not alter the thrust or the purpose of the Bill. Many of us find the Bill troubling and unsatisfactory but we in your Lordships’ House have a duty to try to improve, and this would be a very modest improvement. I commend it to the Minister.
Lord McCluskey
My Lords, I need not repeat the arguments that the noble Lord, Lord Cormack, has put forward again so clearly. We need say nothing more about “normally” except that we were anxious to help to improve the Bill. This was not anti the Government or anti the Scottish Administration.
My second point relates to Amendment 12 in this group, which is to do with the question of justiciability. For the reasons that have been advanced at some length, so I need not repeat them, the noble and learned Lord, Lord Hope, and I are agreed that this word is justiciable. It would be very foolish of the Minister to reject the advice of a man as distinguished in the law as the noble and learned Lord. The word “normally” is bound to appear before a court. If the UK Government decide to legislate on a matter that is devolved and say, “This is not a normal situation”, and some person, whether in the Scottish Government or affected by the legislation, says, “No, it is not”, and it goes to court, the court cannot say, “We’re not going to resolve this matter”—it must answer the question. So to say that it is justiciable is exactly right, and it is wrong for the Minister to ignore that. The Minister kindly suggested that he and I should meet, and we did, but I am afraid that we simply agreed to differ on the issue of justiciability.
I should mention one other point that does not arise out of these two amendments precisely, which is that this is to do with the Sewel convention. I hope that the noble Lord, Lord Norton of Louth, will permit me to quote what he said in Committee on 8 December. In response to the argument that the Smith commission stated that:
“The Sewel Convention will be put on a statutory footing”,
he said, referring to the noble and learned Lord speaking from the Front Bench:
“Surely on his own argument the Government will have to withdraw Clause 2, not only on the grounds of what constitutes a statutory footing but because it embodies the words of Lord Sewel, which he spoke when the Scotland Bill was before Parliament, and not the convention as understood at the time the commission produced its report”.
The noble and learned Lord rejected that, saying:
“I do not accept that, because it appears that what is understood by the Sewel convention is the expression of that convention by Lord Sewel during the passage of the Scotland Act 1998 through Parliament”.—[Official Report, 8/12/15; cols. 1506-07.]
I must confess that it astonished me to hear that. Can the Minister make it clear whether the Government stick by that statement at col. 1507, which was repeated in response to the noble Duke, the Duke of Montrose? In due course I hope to move Amendment 12.
Lord Stephen (LD)
My Lords, I make it clear at the outset that we support the wording provided in his amendment by the noble and learned Lord, Lord Hope. Indeed, we agree very much with the noble Lord, Lord Cormack, that the word “normally” seems at best unhelpful in legislation.
Our first two amendments, Amendments 9 and 10, provide for the consent of the Scottish Parliament to be required when UK legislation makes or attempts to make any alteration to the legislative competence of the Scottish Parliament or the executive competence of the Scottish Government—Scottish Ministers. The amendments would ensure that the current convention is fully reflected in the way it has been understood and applied in practice.
The part of the convention currently covered by Clause 2 is effectively only half of the convention. It is to apply when UK legislation makes provision for issues which are within the legislative of the Scottish Parliament. As has been stated, Clause 2 reflects almost exactly the words used by Lord Sewel in the House of Lords during the passage of the Scotland Act on 21 July 1998, when he said that,
“we would expect a convention to be established that Westminster would not normally legislate with regard to devolved matters in Scotland without the consent of the Scottish parliament”.—[Official Report, 21/7/1998; col. 791.]
These comments in this Chamber effectively recommended the establishment of a convention but it has operated more widely than he indicated or anticipated. We should not blindly follow his words in 1998 rather than the convention as it works now. The constitutional practice of putting forward a legislative consent Motion where the legislative competence is being affected, amended or altered was applied, for example, to the Scotland Act 2012, and there are good constitutional reasons for both elements of the convention to be safeguarded. That should be the correct constitutional approach to the Scottish Parliament. Legislation which without consent reduced the scope of the Scottish Parliament’s legislative competence, would be just as controversial, and perhaps more so, than UK legislation which encroached on matters within its competence.
How long has the convention operated in this way? Since 1999, the convention has been understood to require the consent of the Scottish Parliament when UK legislation will alter the legislative competence of the Scottish Parliament or the executive competence of Scottish Ministers. This was exactly how it was expressed in the memorandum of understanding that was agreed between the UK Government and Scottish Ministers back in 1999. It is also reflected in Devolution Guidance Note 10, which was issued by the Department of Constitutional Affairs back in 1999 and gives information as to how the UK Government operate the convention in practice—and that is how it has been operated.
Lord Forsyth of Drumlean
My Lords, I would like to speak briefly to my Amendment 11, which would delete the words,
“without the consent of the Scottish Parliament”.
The noble and learned Lord, Lord Hope of Craighead, has, in Amendment 7, tabled an amendment which I think came from the Scottish Government. I have to say that I do not particularly like that amendment, which is supported by my noble friend Lord Norton of Louth, because what it sets out is what has actually happened by grandmother’s footsteps over the years, as the noble Lord has just pointed out.
The original basis of the Sewel convention was as a kind of courtesy. It was a convention that we would not normally do something without telling, asking or consulting the Scottish Parliament first. However, it has been turned into a veto for the Scottish Parliament on legislation that affects devolved matters. That is a huge change from what was intended at the time of the passage of the original Scotland Bill in 1998. I am clinging to the past with my amendment. I thought that the convention had gradually been changed into something far greater and therefore my amendment seeks to take out,
“without the consent of the Scottish Parliament”.
I also support the amendment in the name of my noble friend Lord Cormack, which would leave out “normally”. I know that the Minister is a very successful advocate and a very important Scottish lawyer but perhaps I may give him a little bit of advice based on my experience as Secretary of State. When the noble and learned Lord, Lord Hope of Craighead, was the Lord President of the Court of Session and the noble and learned Lord, Lord McCluskey, had a distinguished career as a Scottish judge, both of them gave me quite a hammering on occasion. I discovered that if I got into a fight with them, I usually lost. I am not a lawyer but it seems as clear as night follows day that the word “normally” is going to be a problem. We had a long debate about this in Committee and I cannot for the life of me understand why the Minister has not brought forward amendments to deal with it.
Lord McCluskey
Has the noble Lord thought of suggesting to the Minister that perhaps he could take an informal word from the noble and learned Lord, Lord Mackay of Clashfern, who also had a rather distinguished career in the law?
Lord Forsyth of Drumlean
Indeed, and there is another voice in support of the amendment tabled in the name of my noble friend Lord Cormack and supported by the noble and learned Lord, Lord McCluskey. It is incomprehensible why the word “normally” should be included.
The noble Lord, Lord Stephen, is quite right. What was the Sewel convention has changed into something else. It is a veto, and that is almost certainly what the Smith commission was thinking of. The noble Lord is absolutely right about that. Amendment 7, moved by the noble and learned Lord, Lord Hope, would in effect give legislative effect to what has come to be the practice. Putting into statute what Lord Sewel, back in 1998, said by way of explanation of how the relationship between the two Parliaments would operate is a complete nonsense—a point made over and over again in Committee.
I am hoping to cast a fly here and catch those on the Opposition Front Bench. The great mantra that we have had from them over and over again is that we absolutely have to be true to the Smith commission and make sure that its recommendations are implemented. Amendment 7 would provide for that. So are the Opposition Front Bench going to speak against an amendment whose effect would be to deliver the Smith commission proposals—something that the noble Lord, Lord McAvoy, said he would never do? I look forward to hearing the response from that Bench. It is clear that Amendment 7 would deliver what the Smith commission is proposing. I do not like it because I would prefer this Parliament to be free to pass legislation, consulting the Scottish Parliament in a courteous way but not giving it a veto, which is what I think the Smith commission was seeking to do. I am utterly opposed to leaving in the Bill the word “normally”, which would almost certainly result in the courts being dragged into a dispute between this Parliament and the Scottish Parliament, and that would be thoroughly undesirable.
For all those reasons, I think I am inclined not to press my Amendment 11 when the time comes, but to switch sides and support the noble and learned Lord, Lord Hope of Craighead, and my noble friend Lord Norton of Louth—who is undoubtedly constitutionally correct—and to support my noble friend Lord Cormack in taking out this word “normally”. There are two words that I would like to take out of the Bill: one is “normally”, and the other is “Sewel”. I tried to do that in Committee and actually got past the clerks an amendment which deleted “Sewel”; but unfortunately, due to the intervention of noble Lords opposite, who argued that it was not really terribly good to alter the name of a clause in that way, I was not able to press it again at this stage in the consideration of the Bill. I think it was the noble Lord, Lord Stephen, who was responsible for that.
I say to my noble friend that the great advantage of accepting Amendment 7 is that we would get rid of “normally” and we would get rid of “Sewel”; and we would have something that is absolutely clear in statute and delivers the Smith commission proposals—which, we keep being told, is what this Bill is all about.
Lord Mackay of Clashfern
What has become the convention now seems to be government papers. As far as I am concerned, I had not heard of them until this discussion. It is certainly not a convention of the Houses of Parliament in the sense that they are narrated in that context. But I am not so concerned about the precise terms in which this finishes up. What I am very concerned about is that it should not be subject to a judicial decision. The Parliament of the United Kingdom has never been subject, certainly in the present situation, to the courts of law and I think that it would be a tremendous mistake to make provision in a Bill which could only have that effect.
Lord McCluskey
Do I understand the noble and learned Lord correctly that, without choosing between them, there are two ways to solve the problem he considers to be so important? One is to do what the noble Lord, Lord Cormack, has suggested—delete the word “normally”—and the other would be to adopt either Amendment 12 or Amendment 13, which provide specifically that the matter shall not be justiciable.
Lord Mackay of Clashfern
I do not regard them as alternatives; rather that Amendment 12 tabled by the noble and learned Lord, Lord McCluskey, is absolutely essential. The other form of wording, that it,
“shall not be questioned in any court of law”,
comes from the noble and learned Lord, Lord Wallace of Tankerness, and the noble Lord, Lord Stephen, would be a possible alternative. But something of this kind is in my view absolutely essential if we are setting out in statute a restriction on the power of the United Kingdom Parliament to legislate.
Lord Kerr of Kinlochard (CB)
My Lords, I will touch on a rather similar point to the one that the noble Lord, Lord Empey, just made. I was very surprised by the way the Minister reacted at the end of our discussion in Committee on this point, when the noble and learned Lord, Lord Hope, made a very convincing case and explained the status of the amendment he put forward, as he has done again today. We clearly have two duties: first, to put the Sewel convention, as it operates today, on a statutory basis; and secondly, not to make a defective statute. It seems to me absolutely clear that the inclusion of the vague word “normally” makes this statute defective and a cause of continued dispute. We cannot do that.
I looked at how the Minister reacted when this point was made in Committee. I wonder whether he was not saying something: like the noble Lord, Lord Empey, I wonder whether there is a reason why the Government wish to retain the possibility of acting in breach of the convention as it operates. I wonder whether, for example, he was thinking about the Defence of the Realm Act or the Emergency Powers Act, which almost certainly would go into areas in a national emergency or a state of war where the Scottish Government would normally have fully devolved power. This seems fanciful, but I find it very difficult to think of a logical explanation for the Government’s position that we must write “normally” into the law and thus guarantee dispute in courts of law.
If there are circumstances in which the Government envisage that they would want to act in breach of what has been the convention and what is about to become law, they need to spell out in the Bill what they are. They need to replace the word “normally” with a subsection that defines those circumstances. It seems very unlikely that this is their thinking, but if it is, I hope that the Minister will explain it to us. Otherwise, I can think of absolutely no reason for not supporting the amendment in the names of the noble and learned Lord, Lord Hope of Craighead, and the noble Lord, Lord Norton of Louth.
Lord McCluskey
Would the noble Lord support this possible solution? There is quite some time between now and Third Reading. If the Minister, with the support of others—he would certainly have the support of the Liberal party—could approach his new friends in Edinburgh in the Scottish National Party, and the noble Lord, Lord McAvoy, and say, “This is a mess agreed by Smith. It’s been demonstrated that it can’t be done. Would you agree that we simply drop this clause?”, he might well find that they would be happy to let it be dropped and the Government could renew a statement that we will do what the Smith commission envisaged.
Lord Kerr of Kinlochard
I very much hope that the Government will give a serious, considered reply to the noble and learned Lord, Lord Hope. If it involved suggesting coming back at Third Reading with some variant of his wording, I would want to listen to that. But, it seems to me that we simply cannot do what the noble and learned Lord, Lord McCluskey, is asking for, which is to drop this altogether. It is an important point in the Smith report that the House of Commons has gone along with, and on which all the political parties agree. The idea of just dropping the clause is not possible, but we need to write one that is not defective.
Lord Keen of Elie
I am obliged to the noble Lord. I would suggest that it is a moot issue because there have been occasions where this Parliament has expressly stated that an issue will not be justiciable, but of course the courts themselves will then look at that exception to see whether it is enforceable and lawful. There is that further point, so it is a further layer placed upon the issue by this Parliament but it is not conclusive. I believe there have been occasions where the courts have looked at statutory provisions in which Parliament has purported to say, “This is not a matter for the courts”.
Lord McCluskey
Then why does the Minister not simply accept Amendment 12, which says that,
“the decision as to whether or not the circumstances are such as to allow the Parliament of the United Kingdom to legislate with regard to any devolved matter shall be a decision for that Parliament to take, and shall not be justiciable in any court of law”?
Lord Keen of Elie
I am obliged to the noble and learned Lord and I can express it only in these terms. It is the Government’s considered position that the clause implicitly determines that point in any event. It would therefore not be necessary to express it in the terms proposed in the amendment.
Scotland Bill: Fiscal Framework
Lord McCluskey Excerpts(8 years, 9 months ago)
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The Lord Privy Seal (Baroness Stowell of Beeston) (Con)
My Lords, I think that it is the turn of the Cross Benches.
Lord McCluskey
Can the Minister confirm that the United Kingdom Government will not agree to a deal on the fiscal framework that makes permanent the benefits to Scotland of the Barnett formula, while preserving the disbenefits of that formula to taxpayers in the rest of Great Britain?
Lord Dunlop
My Lords, as I said at the outset, we are very conscious that this deal must be fair not only to Scotland but to the other parts of the UK. We will certainly not, because of the pressure of parliamentary time, do a deal at any cost.
Scotland Bill
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Lord McCluskey (CB)
My Lords, I support the amendment proposed by the noble Lord, Lord Forsyth. I can be brief because he has covered many of the arguments. I wish to make it clear that in my view and, I think, the view of many, the important thing is that this Bill does not concern simply Scotland but the United Kingdom, and in particular the taxpayers in Great Britain. That is why the noble Lord mentioned Wales and, of course, the north of England.
The general view is that Scotland has for many years been subsidised by taxpayers in the rest of Great Britain. That view is inconvertible and I think that the Treasury strongly supports that opinion. Whether that subsidy has been justified is a different question that I will not go into at this stage. The underlying issue is not the interpretation of a word such as “detriment”, which does not mean too much, although, if you ask the people of Wales, they will tell you that they recognise it when they see it arising from this Bill. The real underlying issue is whether taxpayers in the rest of the United Kingdom, and certainly in the rest of Great Britain, should continue to subsidise the Scots and, if so, at what level and on what basis. The issue underlying that is whether it is time for this House to face up to the weaknesses of the Barnett formula and begin to ask whether it is proper to make need the sound basis for supplying tax money to different regions of the United Kingdom.
We have waited for the fiscal framework since May 2015, when the Bill was introduced in the House of Commons. I agree with the noble Lord, Lord Forsyth, that we cannot do our job without the fiscal framework. However, my one reservation about the amendment is that I fear it would let the SNP off the hook because the truth of the matter is that it cannot live with devo-max on any basis other than an improved subsidy; and, if it cannot live with devo-max, it certainly cannot live with independence. Therefore, the argument on this matter is very important because it reveals the basic weakness of the Scottish National Party’s position. I hesitate to give it an excuse for blaming us and condemning us in the usual terms as being unelected et cetera. Therefore, I invite your Lordships to support this measure but I hope that, ultimately, the noble Lord will withdraw the amendment.
Lord Hope of Craighead (CB)
My Lords, the point that the noble and learned Lord, Lord McCluskey, made at the end of his brief speech seems to me to support the position that the Minister is urging us to adopt. The last thing we want is to be seen to be delaying the progress of the Bill through Parliament. As I listened to the noble Lord, Lord Forsyth, what occurred to me was the lack of clarity over how today’s debate will be affected by the absence of the fiscal framework. The Bill proceeds in stages, of course. We are looking today at the Committee stage and the fine wording and tuning of the various clauses in Parts 2 and 3. For the moment, I do not see how the wording of those clauses will be affected by the fiscal framework. At a later stage, the noble Lord may propose that we should not allow these clauses to go forward in the Bill. However, that could be done on Report; it does not have to be done today. If, as the Minister said, there is a prospect of the fiscal framework being agreed tomorrow so that we have it before us on Report, I do not see why the points made by the noble Lord, Lord Forsyth, cannot be examined at that stage, too, or, as a last resort, at Third Reading. Given the nature of today’s debate, I respectfully suggest that the balance of advantage is to proceed to maintain the parliamentary timetable, which is crucial if we are to do our job of supporting the Smith commission.
Scotland Bill
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Lord McCluskey (CB)
My Lords, I shall speak to Amendments 79F and 79G. I have in my hands substantial notes. They were designed to enable me to present an elegant speech full of witticisms, insights and—though I did not realise I needed the permission of the noble Lord, Lord Forsyth—even some political comments. I took part in 1978, from the Front Bench, then occupied by a Government of a different hue, in the first Scotland Bill. I have had a long and lasting interest in these matters. Since I prepared this speech on 13 January much has happened. The field which I hoped to plough has become a dustbowl—so many people have walked through it, including in these debates today.
I shall try to keep my comments short, in light of the well-developed arguments, but clearly the fiscal framework has not been resolved. People have alleged that that is because of the complications. I do not believe that for one second. The civil servants involved are highly skilled and competent and have resolved all the complications. The difficulty is that there is a chasm between the UK Government and the Scottish Government in relation to a simple matter: how much? How much is the UK taxpayer going to have to provide to win the approval of the Scottish Government and, secondarily—the point raised by the noble Lord, Lord Kerr—in relation to borrowing powers? That is also very important.
As has been pointed out, the Smith commission report recorded that the representatives of five Scottish Holyrood parties had agreed the devolution of certain powers. Very well. It also said, at paragraph 95:
“Barnett Formula: the block grant from the UK Government to Scotland will continue to be determined via the operation of the Barnett Formula”.
That is not entirely surprising, considering the make-up of the Smith commission. Turkeys do not vote for Christmas. The members were voting for a continuation of the Barnett formula. The report also contained what was plainly a compromise, namely the so-called no-detriment principle in two manifestations, the first of which is vaguely comprehensible and the second of which is certainly not.
The Scottish representatives on the commission—and they were all Scots—were voting in favour because the Barnett formula was plainly very favourable to Scotland and everyone was afraid of the needs test. In fact, noble Lords who have read John Swinney’s evidence to the committee of this House on the Barnett formula in 2009 will know that that committee tried to pin him down on that. He would not answer, but simply kept repeating, “We want full fiscal autonomy”.
Lord McCluskey
Yes—that was, of course, part of the purpose of the article I wrote for the Herald, which the noble Lord, Lord McFall, was good enough to refer to.
Plainly, the Scottish Government were perfectly entitled to try to secure the most favourable deal they could. It was they who created this timetable that we are being asked to stick to. The timetable was to enable them to go to the electorate in May and present themselves as having achieved a great victory. They created the timetable and we are all supposed to bow to it. I just wonder about that. In relation to the rush to get it through, it also puzzles me that John Swinney is so anxious to get his hands on extra tax powers because, when the Labour Party in Scotland proposed an extra penny on income tax, he replied, “Over my dead body”. Now, we would not wish any harm to the Deputy First Minister, but he has obviously no intention of exercising these tax powers, so what is the rush? It is all to do with the electoral process of the Scottish Government.
Even the devolution of a minor thing, such as the introduction of air passenger duty, could turn out to be worth nothing because, as was pointed out very widely at an earlier stage of the passage of the Bill, Newcastle Airport is going to suffer considerable detriment if all the Scots in the north of England flock to Prestwick, Glasgow, Edinburgh or even further north to take advantage of reduced prices. They are going to suffer a detriment and that detriment is going to have to be met by whom? By the Scottish taxpayer. In other words, the Scottish taxpayer is going to have to find the money to send to Newcastle that has been saved by whom? By the airlines. It is bizarre. The whole thing is slightly mad.
Lord McFall of Alcluith
If I remember correctly, the Chancellor of the Exchequer appeared before the Treasury Committee in January 2015 and, asked about the no-detriment principle for Newcastle and Manchester airports, said it did not apply to them. He pointed to the fact that in the previous year Newcastle Airport had increased its traffic by 12% and Manchester Airport had increased its traffic by 3%, so there was no problem whatever. So we are all in the dark yet.
Lord McCluskey
I fully accept what the noble Lord says; however I argue that there is room for argument as to whether there is a detriment to Newcastle. I just do not know. The Select Committee on Economic Affairs said, as has been quoted already by the noble Lord, Lord Forsyth:
“We agree … that the second no detriment principle is unworkable. It is a recipe for future disagreement”.
The only problem is the word “future”. It is a recipe for constant disagreement, including future disagreement.
My Amendment 79F includes the provision that the new fiscal framework should be published in full. That is very important. The noble Lord, Lord McFall, mentioned that we have to face political reality: I would not challenge his judgment on that, but I add something else. We also have to face the truth—not just the truth but the whole truth—in relation to the fiscal agreement. We need to know the background and I am sure that if it is not published in full, as it should be, then various means can be found, whether in debate here, by means of questions or by freedom of information requests, to discover the full background. What were the people bargaining about? What was the cause of the delay? My guess is that the cause of the delay was what I suggested before—namely, that they could not agree on amounts of money, so the complications are not real complications but deep disagreements.
As I mentioned in the article to which the noble Lord was kind enough to refer, lying behind these discussions and the problem for the Scottish Government is the following. If the present discussions about the fiscal framework reveal, as I suspect they will, that Scotland needs a substantial subsidy from the taxpayers in the rest of the UK—or at least in the rest of Great Britain—that is a demonstration that Scotland cannot exist without such a subsidy. Therefore, the economic case for independence, which was so bizarre in the original White Paper by the Scottish Government, disappears. In other words, we now know, because of the discussions going on—although we do not know the detail—that the economic base in Scotland is such that the tax yield will be very disappointing. The Barnett formula would, of course, disappear on independence and the oil bonanza confidently predicted at the time of the referendum campaign will continue to prove to be a mirage.
As I say, events have perhaps rather overtaken this amendment but it is time that the Scottish electorate were told the whole truth about the Barnett formula. That is part of this amendment. I have read with great care, and more than once, the proceedings of the Lords committee on the Barnett formula. It was a very powerful committee and the questioning was extremely good. The witnesses who gave evidence were of the highest quality and the lesson of that has to be that if we want to move to a just and fair system, we ought to move to one which is not based on a formula that was never invented for the long term but rather as a device to get through a problem existing in the midst of an economic crisis. We should move to a system based on need in terms of welfare and other things. It is time we were told the truth about that. That is the purpose of the second part of this amendment—proposed new subsection (2).
Detriment is said to be a principle in the Smith commission report. I am afraid that I do not recognise it as a principle. The principle that underlies public expenditure should in my view be the question of need. Public expenditure in different regions should be determined largely in relation to need. It is not a straightforward matter and I need not discuss the difficulties involved in that; we are all well aware of them. Therefore, the information that I seek is to give people the truth. The truth is more important than the political reality.
I can deal briefly with the other matter relating to Amendment 79G. The noble Lord, Lord McFall, has already referred to this and I simply adopt what he said. It is vital in Scotland that we have independent scrutiny of, and reports on, economic forecasts. One of the problems with the referendum campaign was that the government White Paper had some very dodgy statistics and forecasts and the Opposition did not question it sufficiently. In a sense, the Government got away with what they said. We need an independent body. I have suggested the model of the Office for Budget Responsibility. It is not ideal but it is the best model that we have. I deal with the question of independence in the way set out in the amendment. I do not pretend that this is an ideal way to amend the Bill, but the ideas here are such that the draftsmen could with ease convert this into a workable amendment.
The Smith commission talked repeatedly about strengthening the Scottish Parliament. One of its principles was strengthening the Scottish devolution settlement and the Scottish Parliament within the UK, including parliaments’ levels of financial accountability. The commission referred repeatedly to independence. I need not quote all the relevant paragraphs. As the noble Lord, Lord McFall, pointed out, the Bill which was before the Scottish Parliament—the Scottish Fiscal Commission Bill—contains a clause which states:
“In performing its functions, the Commission is not subject to the direction or control of any member of the Scottish Government”.
However, the Bill declines to give the commission responsibility for providing independent assessments and forecasts for the Scottish economy. So if they are not made by an independent commission, who makes them? The Scottish Government make them.
Kenny Gibson was cited, but it is worth doing so again. He was the SNP chairman who expressed the unanimous view of the committee:
“We are strongly of the view that not only should the Scottish Fiscal Commission be independent, but it is vital that it is perceived to be independent. That is why we are calling for the Bill to be amended to strengthen the Commission’s role”.
Those who want to read the detail of this will find it in an article in the Scotsman of 11 February by Bill Jamieson. When the vote came, the SNP people voted down that proposal by four votes to three. Bill Jamieson’s article in the Scotsman drew attention to North Korea. I think the SNP is more like a North Korean drill squad: if a commander says, “Do a backward somersault”, the words are hardly out of his mouth before they are back on their feet, having done a backward somersault. It is a classic example of the exercise of this rigid discipline within the SNP. If we do not have an independent fiscal commission, we are in trouble.
We have had enough talk of dodgy dossiers and I have had enough of reading out my notes. I hope that I shall move these amendments in due course.
Lord Forsyth of Drumlean
My Lords, I wish to speak briefly to my Amendment 79H, which I hope provides a way out for my noble friend on the discussions which we have had this afternoon, in so far as it suggests that the Bill, when enacted, should not commence until we have had the fiscal framework laid before both Houses of Parliament and there has been an opportunity to debate it. If I were the Minister, I would grab that because the prospect of moving another amendment proposing that we should not proceed to Report but should reconvene the Committee stage on Wednesday is something that I do not relish, as I am sure he does not either. However, if we get the fiscal framework tomorrow, there will be an opportunity for us to discuss it and therefore there will no need for this amendment. I very much hope that we will have it.
When I was Secretary of State and the noble and learned Lord, Lord McCluskey, was a very distinguished judge, he gave me a bit of a hard time on the reforms which we planned for the criminal law, which I am delighted to say the Labour Party subsequently implemented when it was in power in the Scottish Parliament. He said that I chided him about getting involved in politics—however, I would encourage him to get involved in politics. He has made a brilliant case for why we need clarity on the fiscal framework. I am prepared to support all the amendments that have been suggested because I have no idea what the Government’s position is on what the fiscal framework will be. As regards the proposal to have no detriment, it is the only time in 30 years in Parliament that I have seen witnesses reduced to laughter in giving evidence when they tried to explain what the no detriment principle actually means. Ministers cannot tell us what it means. The noble Lord, Lord Smith, cannot tell us what it means. My noble friend Lady Goldie was on the Smith commission. Perhaps she could tell us what she thinks the no detriment principle means. Without having the fiscal framework and without having a definition of that no detriment principle, it is meaningless.
However, my right honourable friend the Secretary of State for Scotland hit the nail on the head when he said that the Scottish Government want to have their cake and eat it. Perhaps that is what the no-detriment principle means. Perhaps during the recess, instead of negotiating and getting agreement in time for us to discuss it, they have all been off to see Mary Berry so that they can produce more than one cake. The difficulty is that you cannot produce more than one cake. When we were in government a long time ago and, faced with an onslaught from the Labour Party, we struggled to find a way of making devolution work, I had two problems. The first was that I could not solve the West Lothian question. I could not find a way of doing English votes for English laws that would not threaten the union and create all kinds of problems about voting on income tax and the Barnett formula. My second problem was that my officials said that if we were to create a Scottish Parliament and give it these powers, it would have to be responsible for raising its own money. That would mean it would have to be funded on a fair basis, compared to the rest of the United Kingdom, which would mean having a means-based system of funding of the same kind that we use to distribute money to local government, the health service and so on. That would mean the Secretary of State’s budget being cut by £4.5 billion.
We were pretty unpopular in Scotland, thanks to the efforts of the Labour Party, which presented us as anglicising Scottish education et cetera—but we will not go there. I thought that coming up with proposals which gave Scotland the ability to pass its own laws and raise its own revenue, but which would result in a reduction in the budget of 25% or so—£4.5 million—would not be particularly popular. I think the Smith commission and others have played around with ideas which seem politically attractive but they have not actually done their homework on the impact these would have. Amidst the language of fiscal frameworks and everything else, it is all very simple: the tax base in Scotland is slightly lower than that in England. Therefore, if you are going to raise your money from the tax base in Scotland you are going to have less to spend. The Barnett formula provides 20% more per head for Scotland than England. It was 25% in my day, but there has been some narrowing. If you take a grant that is 20% higher and replace it with a tax which is 20% lower, there will be a gap. It has suddenly dawned on the Scottish nationalists that their proposal will actually result in less money for services.
It has also dawned on the nationalists that if you give welfare services and the like to Scotland, they have to administer them. They are demanding £600 million to administer welfare services. My goodness, the Labour Party wants to get rid of the bedroom tax; so do the nationalists. There are all kinds of welfare benefits that people would like to see improved. The plan is to spend £600 million on administration, instead of on the benefits. That is crazy, and for what? So that we can say that it is misery made in Scotland because we are spending it on civil servants and a bureaucracy. That is what is being proposed here.
Lord McCluskey
I hope the noble Lord, Lord Forsyth, will forgive me for interrupting him. It sometimes happens the other way round. Does he appreciate that the £600 million is more than twice the amount that the Scottish Government indicated, in the White Paper, as the cost of running the whole of Scotland after independence on 24 March 2016?
Lord Forsyth of Drumlean
I do love the noble and learned Lord, Lord McCluskey, as a politician making these penetrating points. He is absolutely right; it is real. I am relying on what I read in the newspapers, but that is what they are asking for welfare, behind closed doors. They would rather spend the money on superannuated civil servants, just for the sake of saying, “This is being done in Scotland”. The money is the issue.
By the way, why is the Secretary of State not doing these negotiations? I was going to ring him up last week to talk to him and he was in Africa on Friday while these negotiations were going on. They are being run by the Treasury. If you are in a spending department like Scotland, the very last thing you want is the Treasury running your negotiations. Unusually, the Treasury appears to be being very generous. It is suggesting that the Barnett formula, which gives Scotland 10% of any increase in expenditure in England, should be extended to income tax and that Scotland should get, as of right, 10% of any increase of income tax that is raised in England. How is that going to go down in England? While the Scottish nationalist Government—who want to put up the top rates of tax—force all these top-rate taxpayers to move south and reduce the size of the tax base, the English are expected to send them a cheque to compensate them for the loss of revenue resulting from people moving out of Scotland. They run the benefit system for the disabled and unemployed. If they fail to get people back into jobs or to provide the support, England has to pick up the cost because those benefits are based on performance. No wonder they cannot reach agreement on no detriment or a fiscal framework. This is an argument about having a cake and eating it.
As the noble and learned Lord pointed out, if it agrees the fiscal framework, the SNP is now faced with the horrible prospect of going into a Scottish election and saying either, “We are going to have a bit more independence but we are going to have to make cuts in public services and put up taxes”, or, “We could not get these terrible people at Westminster to give Scotland a fair deal”. The truth is that there were years of lies when people said that Scotland got a bad deal out of the union and that the Barnett formula was unfair: those same critics now cling to that formula like a life-raft. All those people said that Scotland would be better off if it had more powers. By the way, that is not everyone in the Labour Party or elsewhere. All those people turned a deaf ear when people like Gordon Brown and the noble Lord, Lord Darling, who is in his place, warned that if you move to a system which is completely dependent on income tax—an idea which was, incidentally, produced by the Tories to overstep the Labour Party and the Liberals, but was not thought through—you create a situation where you are dependent on a lower tax base and there is no real electoral connection with defence and other UK-based expenditure. Throw in English votes for English laws and you are damaging the United Kingdom.
The fiscal framework, and how it is agreed, is central to whether or not we get a glue, a cement—a fair and balanced system. That is why the Bill should not become an Act and come into force until both Houses have had an opportunity to discuss it openly and fairly, with people in Scotland—who are entitled to fair dealing—seeing what the realities are and being able to make their choice. It is utterly wrong to go into an election pretending it will be all right on the night. If, at the end of the day, the SNP is able to say, “We got a fantastic deal out of Mr Greg Hands. We got extra money over and above Barnett. Vote for us again”, when what matters is long-term future stability, I do not know how long that deal will last; I do not know how it will operate. The Barnett committee, which I served on, and to which the noble and learned Lord, Lord McCluskey, has referred, suggested that, because there is a gap, there should be a 10-year transitional relief and we should move to a needs-based system of funding. I do not know whether that is being proposed or not, but it is essential that we have the opportunity to discuss it.
Why would my noble friend not agree to Amendment 79H, which prevents the commencement of the Bill until we have agreement? What possible reason could he have? The noble Lord, Lord McAvoy, will say that it will be misinterpreted in Scotland and we will be presented as wrecking the Bill. I say to him that it will be proceeding in parallel with the consideration by the Scottish Parliament which is, quite rightly, insisting that it should look at the Bill in the context of the fiscal framework. What is wrong with us proceeding in parallel with it and having a proper debate on both sides of the border? I beg to move.
Lord Darling of Roulanish (Lab)
My Lords, in the earlier procedural debate we touched on many of the issues regarding whether we should consider the proposals of the fiscal commission. In some ways I am surprised that a number of your Lordships who have spoken tonight have talked almost favourably of the Barnett formula. There is something notable about the Barnett formula. One of the reasons that no one has ever touched it, from 1978 when it was first conceived until now, is that, despite its imperfections and despite the fact that many people in different parts of the UK might have said that it was unfair, it actually worked, because it was designed to pool and share resources across the United Kingdom. One of the major arguments that I and others made during the referendum campaign over the last few years is that one of the strengths of the United Kingdom is that you could make sure that when things turned against one part of the UK, because of its workings, in particular the Barnett formula, you could compensate for that. The Bill, which is soon to be an Act, will fundamentally change that because devolving to the Scottish Parliament the power to raise income tax will require a major adjustment to how Barnett has worked in the past.
One of the problems of reaching an agreement between the parties to change the constitution of our country over a four or five-day period is that it will inevitably result in unforeseen consequences as well as the foreseeable ones. One of the reasons that I want to see this fiscal framework as quickly as possible is that we are going into a completely new era. The Scottish Parliament will have more powers than most other devolved parliaments anywhere in the world. However, in many ways we are going into this new era with our eyes closed, because the debate that ought to be taking place about the consequences of what we are doing in Scotland as well as in other parts of the United Kingdom is simply not taking place. Part of the reason that it is not taking place is that the very framework on which all this will hang will not be published until possibly later this week, or possibly next week, when, as I said earlier, we will be in the equivalent of the 11th hour of the debate here.
I will touch on three areas covered by the amendments. One is income tax. I can see that in year one you can do a calculation that shows how much money will be raised by income tax in Scotland and therefore by how much the block grant is reduced. That is easy, give or take £1 million or £2 million. I pose the obvious question: what happens in five or 10 years’ time? How do you apply this no-detriment rule, or try to work out to whose credit it is or whose fault it is that the tax take was not quite what was expected, because Scotland collected either more or less? Any idea, such as that suggested in the White Paper published last year by the previous Government, that somehow you could do this mechanistically and it would not be subject to any politics or anything nasty like that is just for the birds. If we are not careful, what we produce will provide fodder for all those who want to feed off grievances and find grudges for years to come. As I said earlier, I struggle to see how that is going to be resolved.
The noble Lord who will reply for the Government will probably know the answer to this because presumably he has seen the fiscal document. The rest of us have not seen it. This is pretty fundamental. If you are going to say, as we have agreed, that the Scottish Parliament should have all the money that it raises by income tax and there is a consequence on the ground, what is that consequence?
I make one further point. I do not know the ins and outs of this argument about indexation for ageing. I have every sympathy with concerns about the fact that Scotland’s population is ageing faster. Being a supporter of the United Kingdom, I believe that we should pool and share resources. If the Scottish population is ageing more quickly than that of the rest of the UK, the whole point of the United Kingdom is that you can compensate for that. I hope the present Conservative Government are not taking the view that they will devolve and Scotland can live with the consequences.
If you had complete independence, which the noble and learned Lord, Lord Wallace, said would have happened in about three weeks’ time if we believed in the nationalist timetable, then we should be in a situation where Scotland was cut off from the rest of the UK and consequences would follow. However, we have not left the United Kingdom. That is why it is important that we continue to maintain the principle that we pool and share resources, but we should be clear as to the basis on which that is done.
This brings me to the point on borrowing on which the noble Lord, Lord Kerr, touched. I agree with him that we need to be clear about under what circumstances and in what amount the Scottish Parliament can borrow. There is a further point. Borrowing to invest is well understood. That is not problematic. The Scottish Government have the power to do that at the moment if they want to. It is borrowing to fund a shortfall in current expenditure that will cause a problem. There is nothing wrong with the Government borrowing when there is an economic downturn, as I know. The present Government know that as well, since they have had to do exactly the same thing. However, suppose the situation was that the Scottish Government had the power to borrow and, as now, there was a shock to the oil price system. If you believe the shock to be temporary—if it is only going last for a year—as the nationalists maintain when you ask them why oil is not, as they told us it would be in the White Paper, $113 a barrel but around $30 or $40 a barrel, it makes perfect economic sense to borrow to make up that shortfall. That is what you would do. However, if it is a structural change—and many people believe that it is a structural change that will go on for maybe five or 10 years—does borrowing then make sense? Under what conditions could the Scottish Government continue to borrow to cover that shortfall as opposed to making other more difficult decisions, such as putting up taxes or cutting spending?
This also begs the question that the noble Lord, Lord Kerr, raised, as to on whose account do you borrow? Are you borrowing on your own account? With the best will in the world, a new Scottish Government are bound to start with a lesser credit rating than the UK simply because they are a new kid on the block and have no track record. Again, being in favour of the United Kingdom I am quite happy that borrowing ought to be done on a UK basis, but if that is to be the case the consequences need to be spelled out. None of these things can be left in the hope that it will all work out okay on the night.
The White Paper published last year assumed that there was good will. You have to bear in mind here that the Scottish National Party exists to make Scotland independent. That is what it is for. That is what it is looking at all the time. Therefore, if you have something that is opaque, where there will inevitably be difficulties, you are simply storing up problems—I should like to say for the future, but no, it is not for the future; they will be there from day one.
Exactly the same points are being made on welfare. As I said during the referendum, I have never understood the argument that Scottish taxpayers, of whom I am one, would want to pay money to people to administer a benefit system, a lot of which is, ironically, being administered in Scotland for the rest of the United Kingdom and providing useful employment. Why do I want to pay more for someone to do that or, for that matter, to collect my taxes?
Leaving aside the collection cost, if you take the actual expenditure on mainstream benefits, a lot of benefits have been devolved to the Scottish Government and that is absolutely fine. However, again, it is unclear to me who in five or 10 years’ time would bear the cost if, for example, the policies north and south of the border were different. It is entirely acceptable that they should be different. We are bound to have, as we do now, Governments of different political complexions. However, if, for example, you have an ageing population, all other things being equal, your disability benefits will start to go up. Is that okay? Is that built into the settlement or will taxpayers in other parts of the United Kingdom have something to say about it? I am sure these problems are resolvable, although I note that Professor Bell of Stirling University said recently that no one else in the world has done this.
As an aside, my own preference, having got to the stage that we have, is that we should look at countries such as Canada—big countries that have a federal settlement in many senses but have provinces with different powers. One of the advantages is that when you pay your income tax you can see that some of your tax is going to pay for things such as health and education, but you pay tax to the federal Government for things such as pensions or defence and so on. It is then easier for other things to slot into place—borrowing to fund various activities and so on. We have not looked at that.
It is often said that the British are good at compromising, but what we have here is not devolution being done to any overall template—it is being done on the hoof. When you do things on the hoof, sooner or later you trip up. As I said earlier, this is not just a matter between one political party and another. If this fiscal framework had been published, others from outside could have looked at it and said, “There is a better way of doing this”, or, “Have you thought of the consequences of that?”. Instead, the public north and south of the border have been kept largely in the dark. That is simply going to cause considerable difficulties.
Other issues have been raised as well, such as bailouts and the question of no detriment, which we will need to come to. Equally, the White Paper published last year had examples of what would happen if the UK Government were to raise or decrease expenditure. What would the consequences be? Could you have a situation where more taxes are being paid in one part of the United Kingdom to fund expenditure somewhere else? Again, these are problems to which I have not yet seen the answers.
I heard people say in the earlier exchanges that having an EU referendum campaign lasting some four months was an awfully long time. Having lived through a referendum campaign that lasted some two and a half years, frankly, I would have killed for four months. I fully accept the right of the Scottish National Party to campaign for independence but what I bear in mind is that the majority of people in Scotland were clear that they wanted to stay as part of the United Kingdom. What worries me about this, and until I have seen the fiscal framework I cannot pass a final judgment on it, is that rather than resolving the matter and saying, “That is the settled will of the Scottish people”, we have put something in place here that will lead to opacity, confusion and eventually grievance. That is not a way to get a secure settlement. Perhaps the Minister will have words that reassure us on all these points. So far I have not heard them but I look forward with great interest to what he has to say.
Lord McCluskey
The noble Lord said that the Barnett formula works. I doubt that anyone would contradict that. It works, and does so from the point of view of the Treasury for the reasons given: it is simple and clear, and so on. First, does the noble Lord suggest that it works fairly throughout the United Kingdom? Secondly, because of the future governed by this Bill, does he support subsection (2) of the new clause that I propose in Amendment 79F? It calls for the Secretary of State to publish,
“a full description of any agreement whatsoever reached between the … Governments relating to the future of the Barnett Formula or its application, amendment or replacement in the future”.
We need to know not whether it worked in the past but whether it worked fairly and how it will work in the future. Does he support that amendment?
Lord Darling of Roulanish
In relation to the Barnett formula, I chose my words carefully. I said that it worked; I did not go on to say “terribly well” or “extremely well” or “without any complaint”. If you look at the north-west of England, there is a legitimate complaint there that Barnett treats it the same as it does the south-east of England, when their economies are clearly very different. I know that successive Chancellors looked at the Barnett formula. I looked at it in the halcyon period of the three weeks between taking office and discovering that Northern Rock was on the horizon, which presented me with rather more pressing problems that I had to deal with. But I can see why, it having been there for so long, no one has touched it. I am sure that others in this House will know that the late Joel Barnett often said that he never intended it to last. It was a fix but it worked. However, where I agree with the noble and learned Lord—I will confess to not having studied his proposed new subsection (2) in the detail I perhaps should have done—is that if we are having a new system, we really need to know how it works. What we do not want is what happened in the aftermath of the Smith commission, when everybody signed up to it and the next day it was denounced. That will not work. If we have something that does not work, let us find out now rather than coming to that awful realisation over several months and years to come.
Lord Dunlop
As I said, as regards tax competition, that would not be counted for in terms of compensation. I hope that I have made that clear.
Lord McCluskey
May I ask about a point on the language used by the Minister? He drew a distinction between direct and indirect detriment but I look in vain in the Smith commission report for these adjectives. I know that my noble and learned friend has a copy here, as do I. What is the basis for the Minister drawing a distinction between direct and indirect detriment?
Lord Dunlop
As I said, the Smith agreement is a set of high-level principles. The negotiations are about how the two Governments apply those principles in practice. When, as I hope, the fiscal framework is agreed shortly, the noble and learned Lord will see how the two Governments have reached an agreement as to how these principles will apply in practice. That is what the discussions that have been going on for the past months have been all about.
Lord McCluskey
Is that expression “high-level principle” a euphemism for low-level politics?
Lord Dunlop
No; it is the responsibility of the two Governments to work out this package of powers and how the fiscal framework will work in practice, which is what we are doing.
Lord Wallace of Tankerness
My Lords, amendments in my name and that of my noble friend Lord Stephen are in this group. Basically, the arguments are very similar to those just advanced by the noble and learned Lord, Lord Hope of Craighead. The powers in Clause 68 are extremely wide. We are coming to the end of the Bill and people will think that these are technical amendments but in fact they are of profound constitutional importance. In its report on the Bill, your Lordships’ Constitution Committee has already drawn the House’s attention to the extent of the powers conferred by Clause 68, and therefore it is important that the Government take these points seriously.
Our Amendment 79AA is very similar to the amendment moved by the noble and learned Lord, Lord Hope, with one difference, which is that we allow the powers to apply in respect of Part 3 because of the report of the Delegated Powers and Regulatory Reform Committee. Paragraphs 24 to 28 of the committee’s 15th report of this Session deal with this clause.
The noble and learned Lord gave a number of reasons why he thought that this provision was exceptional but I think that he may have missed one out. He said that there was no limit to when these powers could be used but in fact there is no time limit on the legislation that it can apply to. Subsection (2) says:
“Regulations under this section may amend, repeal, revoke or otherwise modify any of the following (whenever passed or made)”.
I emphasise the last four words, which mean that future legislation could be affected by these powers. The Delegated Powers and Regulatory Reform Committee said in paragraph 25 of its report that the memorandum from the Government,
“acknowledges that the power to amend or repeal future enactments is exceptional. Reasons are given as to why this is needed in connection with Part 3 of the Bill which deals with welfare benefits: the commencement of Part 3 is expected to take place over a period of time and, because of the complexity of the area, it may be necessary to make changes to legislation enacted between the date on which the Bill is passed and the date on which the functions to which Part 3 applies are transferred to Scottish Ministers. We consider this provides a reasonable explanation for needing the power to amend future enactments in relation to Part 3 of the Bill”.
But the report goes on to say that that,
“does not justify the extension of this power to the other Parts of the Bill. It may be that similar considerations apply, but because nothing is said about this in the memorandum it is impossible to know”.
In other words, the Government are not only trying to take these powers but they have given the appropriate committee of your Lordships’ House that is scrutinising the Bill no reason whatsoever for such wide powers, including the exceptional power to amend or repeal future enactments. They did provide an explanation in respect of Part 3, which the committee found to be a reasonable one, and that is why we have not sought to remove it. Amendment 79AB is consequential.
As was also picked up on by the noble and learned Lord, Lord Hope, Amendment 79BA refers to the provision that talks about,
“any other instrument or document”.
Our amendment would remove those words from subsection (2), as it is thought that it is extremely wide. Again, the 15th report of the Delegated Powers and Regulatory Reform Committee commented on this at paragraph 27, noting its exceptionally wide effect without any compelling reason—that no justification has been given for a power to revoke any instrument or document, whenever made. Therefore, we believe that it should be removed from the Bill.
The other point is one touched on by the noble and learned Lord, Lord Hope. We deal with it in Amendment 79EA, which would remove references to Acts of the National Assembly for Wales and Northern Ireland legislation from this regulation-making power. Again, no substantive reason has been provided for extending the Secretary of State’s regulation-making power under Clause 68 to legislation made by either the National Assembly for Wales or the Northern Ireland Assembly. It seems very wide and raises the interesting question of whether legislative consent Motions were required in the Northern Ireland Assembly or the National Assembly for Wales before including these provisions in the Bill or whether, indeed, if these powers are ever wished to be used, doing so would require legislative consent Motions. Perhaps the Minister can enlighten us when he comes to reply.
Lord McCluskey
Before the noble and learned Lord sits down, may I ask him a question on that point that I meant to ask my noble and learned friend Lord Hope? The particular measure in subsection (7) refers to, as the noble Lord said, Wales and Northern Ireland legislation. Is that within the Long Title of the Bill? The Long Title is:
“To amend the Scotland Act 1998 and make provision about the functions of the Scottish Ministers”,
not the Secretary of State, “and for connected purposes”. I am not very good at reading Long Titles, but when I read this I cannot see how the subsection objected to fits within it.
Lord Wallace of Tankerness
The noble and learned Lord makes a very important and perceptive point, and I am glad it is not me who has to reply to it from the Dispatch Box. I certainly see his point that it is a very stark, simple Long Title. To actually extend the ambit of the Bill to Measures or Acts of the National Assembly for Wales or legislation of the Northern Ireland Assembly does seem a bit of a stretch. No doubt the Minister can enlighten us when he comes to reply.
The important point is that we do take seriously the report from the Delegated Powers and Regulatory Reform Committee. At the heart of it, these are extremely wide powers and, in some respects, exceptional powers. With the one exception relating to Part 3, no explanation or justification has been provided by the Government for taking these wide powers.
Lord McCluskey
“The fiscal framework
(1) Within 30 days of the date on which this Act is passed, the Secretary of State must publish in full the new fiscal framework agreed between the Scottish and UK Governments, unless it has already been published by the Secretary of State.
(2) Within 30 days of the date on which this Act is passed, the Secretary of State shall publish as an appendix to the new fiscal framework as published a full description of any agreement whatsoever reached between the said Governments relating to the future of the Barnett Formula or its application, amendment or replacement in the future, including any agreement as to when any such change is intended to be considered by the two Governments in the future.
(3) In this section, “the new fiscal framework” means the agreement between the said Governments as to the arrangements and institutions intended to underpin the tax and spending powers included and devolved under this Act and under the Scotland Acts of 1998 and 2012, including the funding of the Scottish budget, planning, management and scrutiny of public revenues and spending, the manner in which the block grant is or may be adjusted to accommodate further devolution, and the operation of borrowing powers and cash reserve, fiscal rules, and independent institutions.”
Lord McCluskey
I am not sure whether I moved Amendment 79F originally, but if I did, I would want to withdraw it. The same applies to Amendments 79G, 81A and 82A. What I want to do is return to these matters on Report. For the benefit of my noble and learned friend Lord Hope of Craighead and others, it is possible to make those amendments known tonight. Officials are meeting at the end of this debate to discuss what is to go into the list of amendments for Report and I have put mine in by dint of simply asking them to repeat certain numbered ones which appeared in the Marshalled List. They accept that that is a method they can use to proceed.
The other point is a matter for the Committee. It appears quite silly in a way for the Committee to group Amendments 75 to 82, and then not allow those to be dealt with when the discussion on all these amendments is completed. We ought at that stage to be able to say, “I am not going to move Amendment 82A”, or whatever it may be, instead of which we have to go through the sequence. Therefore, I have been sitting here for approximately two and a half hours, waiting to stand up and say, “Not moved”. I am happy to say it now.
The Deputy Chairman of Committees (Baroness Pitkeathley) (Lab)
As the noble and learned Lord has spoken to the amendment, I think he will have to move it, after which it can be withdrawn.
Lord Wallace of Tankerness
On the important point made by the noble and learned Lord, Lord McCluskey, about having to table amendments again to maintain the sequence, and, indeed, in relation to the point made by the noble and learned Lord, Lord Hope of Craighead, on the last group of amendments, perhaps the Minister will take this opportunity to clarify whether, when we come to Report, the order of consideration will be as in Committee; in other words, that Parts 2 and 3 will be taken at the end—I think next Monday is the day currently set down for that—and the other parts will be debated on Wednesday.
The Deputy Chairman of Committees
Does the noble and learned Lord, Lord McCluskey, now wish to withdraw his amendment?
Lord McCluskey
With the leave of the Committee, I beg leave to withdraw the amendment.
Scotland Bill
Lord McCluskey Excerpts(8 years, 11 months ago)
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Lord McCluskey (CB)
My Lords, I have added my name to several of these amendments and I need add nothing to what has been said by the two noble and learned Lords in support of them. However, perhaps I may draw attention to one thing. As has already been made clear in relation to two of these amendments, the Bill appears to depart expressly from the clear recommendation or agreement that appears in the Smith report, paragraph 32 of which states:
“Responsibility for the management of the Crown Estate’s economic assets in Scotland, and the revenue generated from these assets, will be transferred to the Scottish Parliament”.
Similarly, as the noble and learned Lord, Lord Wallace, just said, there is a provision which appears to be departed from. Amendment 48A relates to further devolution to local communities. The provisions in the Bill show that a recommendation or an agreed decision in the Smith report is not written in stone. Hitherto, the Government have made a great point of saying that the Smith commission must be enacted in full. Here we have two instances, at least, where the Government have departed from, and indeed contradicted, what the Smith report advised. Are we to take it that, if the Government come to the view that Smith did not get it quite right in some way for some clear, sound reason, the Smith recommendation need not be followed? Will that apply to other provisions in the heads of agreement relating to other matters in respect of which the Government have hitherto followed the Smith line?
Lord Gordon of Strathblane (Lab)
My Lords, I shall intervene briefly on two points. First, as regards the discussion about “may” and “must”, while I concede that “may” sounds too permissive and does not adequately reflect Smith, it could be argued that “must” sounds as if one needs to coerce an unwilling UK Government. Surely, the word “shall” would be the obvious alternative.
Secondly, as regards the point made by the noble and learned Lord, Lord Wallace, while I agree entirely that the island authorities are wholly competent to manage the Crown Estates, and I hope they will be allowed to do so, the agency for handing over the power must be the Scottish Parliament. For this Parliament to insist in advance that it goes is not devolution, it is compulsion.
Lord Dunlop
I note what the noble and learned Lord says, and I will reflect on his point; I am sure that we will continue to discuss it.
The clause enables the Scottish Parliament to make its own legislation about the management of the Crown Estate in Scotland after the transfer—and beforehand, should it wish to have arrangements in place in readiness for transfer. The Scottish Government have already made commitments to devolution to island communities. In the document Empowering Scotland’s Island Communities, which has already been referred to, the Scottish Government have committed to ensuring that 100% of the net income of the islands’ seabed is passed to island communities. The Scottish Government have also said that they intend to consult on the future arrangements of the Crown Estate. Therefore, as I said, although I am sympathetic to the sentiments that have been raised about this issue, the Government do not believe that it is appropriate for the Bill to set out any onward arrangements for devolution to local communities. That is a matter for the Scottish Parliament. I look forward to hearing more from the Scottish Government on their further plans as they develop them.
I turn to Amendment 46. Clause 34 provides for a transfer scheme that would transfer all the existing Scottish functions of the Crown Estate commissioners to Scottish Ministers or to a person nominated by them. The amendment seeks to change the entity to which the transfer of those executive functions is made from Scottish Ministers to the Scottish Parliament; several noble Lords referred to this.
I note that the right honourable colleague of the noble and learned Lord opposite also tabled this amendment in the Commons in Committee. The Smith commission agreement stated that responsibility for the management of the Crown Estate and the revenue generated from those assets would be transferred to the Scottish Parliament. However, the Scottish Parliament is a legislative rather than an executive body, as I have already said, and for that reason it is not equipped to undertake the management functions that are currently exercised by the Crown Estate commissioners. The Law Society of Scotland also observed that the transfer is to the Scottish Ministers rather than the Scottish Parliament, and noted that there are good practical reasons why this should be so—not least that the Parliament does not exercise its executive powers.
Lord McCluskey
The Smith commission report states in paragraph 32 that what was to be transferred to the Parliament was not the management but the “responsibility for the management”, so Parliament would then decide what agency, if other than the Scottish Executive, would manage the estate. Surely, that is the important point.
Lord Dunlop
We feel that in the clause, in giving the Scottish Parliament the legislative competence but then facilitating the executive competence of the Scottish Government, we have got the balance right.
As I was saying, the clause transfers management functions relating to the Crown Estate to the Scottish Ministers, which means that the Scottish Parliament has the ability to legislate in relation to such management functions. That gets the right balance and gives effect to the Smith commission agreement in what it intended to achieve.
I turn to some of the specific points that were raised —in particular, Fort Kinnaird, which I believe some people thought was a Ministry of Defence base but turns out to be a shopping centre in Edinburgh. I very much agree with what my noble friends Lord Lang and Lord Sanderson have said about this and the importance of not upsetting joint arrangements built on trust. The management of all the Crown Estates, wholly and directly owned Scottish assets, will be transferred under the transfer scheme. Fort Kinnaird, as has already been said, is not wholly and directly owned by the Crown; it is held by an English limited partnership in which the Crown Estate commissioners manage interests alongside other commercial investors. The partnership owns property in other parts of the United Kingdom, and Fort Kinnaird has never been wholly and directly owned by the Crown. It was brought into the partnership by the commissioners’ joint venture partner, the Hercules Unit Trust, and is managed by British Land. Revenue from the Crown Estate’s interests in Fort Kinnaird will therefore continue to be passed to the UK consolidated fund for the benefit of the UK as a whole.
I am very happy to confirm for the noble Baroness, Lady Liddell, that I shall take her specific point away and write to her on the offshore renewables catapult. The noble Earl, Lord Kinnoull, talked about protections for the assets of the Crown Estate. The current managers of the Crown Estate commissioners are under an obligation to maintain an estate in land, so it is appropriate to pass on this obligation as part of the transfer of management. The new manager may make changes to the pool of assets that make up the estate under its management; it can sell some assets but must reinvest the proceeds, bringing new assets into the estate. But the new managers must maintain an estate in land; they cannot convert the estate in its entirety to liquid assets to fund public spending. An estate in land in the ownership of the Crown must be retained for the future; that is an important point of stewardship.
I hope I have been able to provide some clarity on the approach and reassurance on the Government’s commitment to make a scheme. Therefore, I ask the noble and learned Lord to withdraw his amendment.
Lord McCluskey
I spent more than 50 years in the criminal and civil Scottish courts, as an advocate and prosecutor and as a law officer and a judge, and I never encountered any problem arising out from the British Transport Police. I support the point made by the noble Lord, Lord Empey, that there is no problem here to be dealt with. The second point simply relates to paragraph 67 of the Smith commission report, which, as the noble and learned Lord pointed out, refers to the functions of the British Transport Police and says that they will be a devolved matter. There is no reasoning whatever behind that; we do not know where it came from or where it was supported, even by the Liberal representatives on the Smith commission. I would be interested to hear from some of them what the reasoning behind that was, because it is not detectable from the Smith report.
Lord Sanderson of Bowden
I, too, have grave concerns about this part of the Smith commission report, in paragraph 67, on the functions of the British police in Scotland being a devolved matter. We have heard from somebody from Northern Ireland on this whole question of security, which is so important. Why, if we have something that works as the British Transport Police does, do we change it? It is very dangerous to change it in this Bill—and I hope that my friend on the Front Bench will be able to give us a reasonable answer.
Lord Berkeley
The noble Lord mentioned funding by the train operators. He will be aware that, as the noble Lord, Lord Sanderson, said earlier, 50% of the funding of the BTP UK-wide comes from Network Rail and the other 50% comes from the train operators roughly in proportion to their passenger miles. He said that Scottish train passengers would not want to pay for this, and that will mean that the BTP will have to be paid out of general Scottish financing rather than through the current arrangement. The consequence of that will be that the budget will be cut pretty quickly and everything will be integrated. I would also be interested in knowing how Network Rail’s contribution will be arranged. Is it legal and how will it be done? Will it be on the basis of track miles or something else? Those are the sorts of questions to be answered.
Lord McCluskey
Perhaps the Minister would take a short question from me. Is he advising the Committee that Clauses 42 and 43 enact the provision contained in paragraph 67 of the Smith commission report and nothing else?
Lord Dunlop
I am saying that these clauses provide the framework that allows us to go forward, but the Scottish Government have to decide what operating model they want for the policing of the railways in Scotland. I said that I anticipated that it would take two to three years before these functions were devolved, and that is because all sorts of contracts with third parties are involved here—the noble Earl, Lord Kinnoull, talked about pensions. I do not underestimate the complexity involved and I hope the Committee will understand if I do not have specific answers to all the questions; we will be working with the Scottish Government to clarify them over the next two to three years.
Scotland Bill
Lord McCluskey Excerpts(9 years ago)
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The Lord Speaker (Baroness D'Souza)
My Lords, if this amendment is agreed to, I cannot call Amendment 2 by reason of pre-emption.
Lord McCluskey (CB)
My Lords, I had not expected to be on my feet just at this moment, but I will speak to Amendments 4 and 5. Amendment 4 asks that the word “only” should be inserted into line 11, so that the new provision would read:
“The only purpose of this section is … to signify the commitment of the Parliament and Government of the United Kingdom to the Scottish Parliament and the Scottish Government”.
The first question I have to ask the Minister is: if this is not the only purpose of the section, what other purpose or purposes does the section have? I do not see any value in having the words, “The purpose”, unless we make it clear that this is the only purpose.
My Amendment 5 would remove the words,
“with due regard to the other provisions of this Act”.
As I understand statutory interpretation, when a court or other body is called upon to understand an Act of Parliament, it may well be necessary, in the case of any kind of ambiguity, to look at any other provisions of the Act which bear upon the same matter. There is a duty in law and in custom for courts and others to have due regard to the other provisions of the Act, so I do not see what purpose this provision serves here. My own general approach is that the shorter legislation is, the better. Legislation is often too wordy and too confused. If the words are not necessary, they should not be there. That is the simple basis on which I speak to both the amendments standing in my name.
Lord Cormack (Con)
My Lords, I will speak briefly to Amendment 7, which stands in my name, but before doing so I agree with what the noble and learned Lord, Lord McCluskey, just said about wordy legislation and endorse entirely what my noble friend Lord Norton of Louth said in his crisp, succinct introduction of his own two amendments. This is a very unsatisfactory Bill, brought about by extremely unsatisfactory circumstances. If we in your Lordships’ House are going to try to improve a bad Bill—as is for ever our task, and one which was never more needed than in the case of this Bill—we have to address certain very important aspects of it.
I concentrated my amendment on the whole subject of parliamentary sovereignty. Although the Scottish Parliament came about because of the wish of the Scottish people in a referendum, nevertheless it was created by Act of Parliament. If it is to be abolished, that should be done by Act of Parliament, too. I neither forecast nor advocate its abolition but if we are to have such a provision in this Bill—I doubt whether it is needed, and my noble friend Lord Norton of Louth made that position plain in his speech—it should be a parliamentary provision. That is why I suggest that it should be on the basis of a two-thirds majority in a vote of the House of Commons, in which 75% of the Members elected by Scottish constituencies vote for abolition. That provides as strong a parliamentary safeguard as can be envisaged. It is infinitely to be preferred to the referendum route.
Lord McCluskey
In the light of the debate so far, I should like to add something to what I said before. I remind the House that the purpose of legislation is to effect a change in the law—to state the law. Subsection (1) is a statement:
“The Scottish Parliament and the Scottish Government are a permanent part”.
Whether or not that changes the law, I do not know. Given the arguments about sovereignty, it may state the law at present but it cannot change it a week next Tuesday because, as my friend Sir Gerald Gordon, an expert lawyer in Scotland, said, there is no written constitution in Scotland in the United Kingdom, but it can be written in one sentence, and that is: “There shall be a Parliament at Westminster, and it can do what it likes”. Another version is: “There shall be a House of Commons at Westminster, and it can do what it likes”. Apparently, the Government do not hold to that view because, as the noble Lord, Lord Forsyth, has pointed out, it cannot do what it likes and must do what the Smith commission has decided it will have to do.
The point I want to make is the important one that subsection (1) makes a statement, although I do not know its legal effect at all. But when we look at subsection (2), where I want to add the word “only”, it states:
“The purpose”—
which probably means the only purpose—
“of this section is … to signify the commitment of the”,
UK Parliament et cetera to something or other. In other words, if you interpret subsection (1) by looking at subsection (2), which you have to do, of course, you find that its only purpose—or “the” purpose—is simply to make a statement of fact. I do not see how these things change the law.
The noble Lord, Lord Forsyth, made remarks about the parliamentary draftsmen. They have my deep sympathy because they were given an appalling job to do, given the terms of the report and the whole background to it, including matters discussed at Second Reading. If this is the best they can do, maybe we can try to do better, but we are writing on water here.
Lord Lang of Monkton (Con)
My Lords, I had not intended to speak on these amendments because I thought that I would prefer to speak on Clause 1 stand part. However, it might save time if I speak now, not least because the debate has already ranged very widely over a number of more general points.
I also wanted to speak at an early stage to thank those noble Lords—in particular my noble friends Lord Norton of Louth and Lord Forsyth, and the noble and learned Lord, Lord Hope of Craighead—who made polite reference to the report of the Constitution Committee. My noble friend Lord Forsyth’s excellent speech in particular, in which he managed, in that wonderful tone of slightly supressed indignation, to quote from the report, reminded me just how strongly the committee felt about it when it prepared that report. Committees tend to present reports in fairly moderated terms, but these are very serious issues. Indeed, we were in a pretty bad mood to start with because we had already produced a report on the draft clauses, which came out some time before this Bill appeared, in which we drew the attention of the Government to some seven major points of constitutional principle that we thought should be replied to. The reply we eventually received was just more than two lines long. We had to express pretty considerable indignation at that.
While I am on the same theme, it is also a matter of regret to us that the Government have not yet been able to reply to our latest report, which we particularly hoped to have had ahead of the start of this Committee. I hope that that response will appear very soon.
In our report, we criticised very strongly the progeny of the Bill and the fact that the Government had committed to accept the Smith commission’s terms. I will not dwell on that point any longer; it has been very well covered by other noble Lords. We also placed strong emphasis on the importance of the position of the United Kingdom and, with all this demand-led devolution that has been going on, of stabilising and securing the sovereignty of the United Kingdom for the future. I am glad to say that another instalment of our work is on its way to your Lordships in due course on the union and devolution, which will cover that theme and, I hope, carry it forward.
Reverting to this debate, the clause we are looking at and the amendments to it are about sovereignty, which is a clear, absolute and easy-to-identify concept. All the amendments are about protecting it from potential inroads that arise from all the changes made in the other place that depart from the simple request made by the Smith commission. It is a declaratory clause. As my noble friend Lord Norton pointed out at Second Reading, by making a declaratory clause the core of a new parliamentary Bill it has been drawn up in the face of the Government’s own guidance on drafting legislation, which deplores such treatment.
Not only is it unwise, but it also compromises the subject by adding specific changes that were not requested by Smith. They are changes that weaken the principle of sovereignty, in particular the requirement under subsection (3) that there should be no abolition of the Scottish Parliament without a referendum for the Scottish people. Smith did not request that. That is not declaratory; it has specific substance. How does it protect the sovereignty of the United Kingdom?
I also ask my noble friend the Minister: why do the Government think that the Scottish National Party wanted that amendment to the Bill? It does not believe in permanence; it wants impermanence. It wants to undermine sovereignty and provoke the United Kingdom Parliament. Ultimately, it wants to break up the United Kingdom. Every extra concession granted makes that more possible.
The noble and learned Lord, Lord Wallace of Tankerness, referred to political reality. Yes, no one believes that the Scottish Parliament will be abolished and no one wants it to be abolished—you cannot put the smoke back in the bottle—but why compromise the position with qualifications of this kind in this important Bill? The Scottish National Party talks a lot about the sovereignty of the people—what one might call the “Braveheart philosophy”—but we have to wonder whether the clause makes the issue justiciable. Might some Scottish judge at some future date rule that the combination of permanence and a Scottish referendum in a statute overpowers the sovereignty of the United Kingdom Parliament? I do not know the answer to that, but I know that at Second Reading a number of my noble and learned friends identified this area as one that needed close attention.
Lord Keen of Elie
I would be pleased to clarify. We were speaking theoretically in the context of the supremacy and sovereignty of this Parliament. In the light of the referendum finding that the Scottish Parliament should be abolished, it would be necessary for legislation to be put forward. It would in theory be possible for that legislation to be defeated in this Parliament. That is all that I was saying. However, we are in the realms of extreme speculation here—or it appears to me that we are.
Lord McCluskey
My noble and learned friend Lord Hope has pointed out the possible difficulty in the current wording. I am very fond, as are many Scots, of the well-known tennis player called Andy Murray. Is he one of the “people of Scotland” in new Section 63A(3)?
Lord Keen of Elie
I am not in a position to say whether he or any other individual falls into that category, and at this stage I would not speculate on his status.
Lord McCluskey
Lord McCluskey
In light of the answer relating to the word “only”, to the effect that it is implied by the use of the definite article, I see no need to pursue this at this stage. I will not move this amendment and I intimate an intention not to move Amendment 5.
Lord Mackay of Clashfern
It has to be remembered that this Bill is amending the Scotland Act. This provision, which my noble friend Lord Forsyth of Drumlean wants to put in, happens to be there already in Section 28(7). That is my objection. Repetition may be a good idea, for all I know, but it is there already. The point made by the noble and learned Lord, Lord McCluskey, about unnecessary legislation might come into this. There does not seem to be much need for it, especially when Clause 1 refers to the other provisions of the Scotland Act, into which this is being embedded.
Lord McCluskey
The actual wording of Section 28(7), which I do not suppose many noble Lords will have memorised, reads:
“This section does not affect the power of the Parliament of the United Kingdom to make laws for Scotland”.
It does not talk about the sovereignty of the United Kingdom Parliament at all. It talks about its continuing power to make laws for Scotland.
Lord Norton of Louth
My Lords, these amendments, on the whole, move us forward. They are an improvement on what is presently an unsatisfactory provision in the Bill. I drew attention to this at Second Reading, but in doing so I was hardly doing anything novel. Attention was drawn to the problem in the last Parliament by the Political and Constitutional Reform Committee in the other place and by the Constitution Committee of this House. The point was made that this did not even put the Smith commission recommendation in statute. The commission recommended putting the convention on a statutory footing, but the clause as drafted does not do that; it merely takes the words of Lord Sewel and puts them into the clause. It does not provide legal certainty. We are in an unusual position; indeed, this has not happened before. Conventions have been transposed into statute previously, but once in statute, the convention is dead and the statute provides legal certainty.
What we have here is an attempt to provide something in statute while retaining the flexibility of the convention —which basically carries on as a convention. We have to make a decision: either it is a convention, in which case it is not in statute and we just carry on as before—the convention is widely accepted for what it is and is not really in doubt—or we actually put it in statute so that we have legal certainty and clarity, and it is not then likely to come before the courts. The problem with the wording at the moment is that there is that possibility. One could remove “normally”, which would be a major step forward; or we could go with Amendment 12, which the noble and learned Lord, Lord Hope of Craighead, has put forward and which I have put my name to, because it provides legal certainty.
If the Government want to retain the flexibility of a convention, there would have to be some additional provision stipulating quite clearly any exceptional circumstances. That could be, for example, through Amendment 18, in the name of my noble friend Lord Cormack, which does stipulate those circumstances. One might have to take that further in defining what constitutes a national emergency, but it does refine the provision. Either the Government accept an amendment like that or they have to come up with their own. They could accept Amendment 12 and, if they wish, qualify it, but the onus is on the Government. However, I am quite clear that we really cannot proceed with Clause 2 as presently worded. As I say, either we have a convention or we have legal certainty in statute. I do not think we can try to have both.
Lord McCluskey
My Lords, I was happy to add my name to Amendment 14 in the name of the noble Lord, Lord Cormack. People keep apologising for not being lawyers, but I think it is time a lawyer apologised for being a lawyer. I am a lawyer and I want to say this. It is commonly said by judges up and down the country that words in a statute should be like a piece of crystal—absolutely clear and unambiguous. They should be clear, unambiguous and definitive, but the word “normally” has no fixed meaning at all. I looked it up in a number of dictionaries. In one, the first definition of “normally” was “rectangular”—I do not know where that takes us.
We use a lot of elastic words from time to time, such as “reasonable”, “appropriate”, “usually” or “a piece of string”. There is no clear meaning or definition to these words, but the difference between a word in a statute and a convention is that, as the noble Lord, Lord Lang, said, a convention is fluid and flexible. You can develop it all the time in the light of experience—qualify it, extend it and so on—but you cannot do that with the words of a statute. My problem is that I do not know what a court would make of the word “normally”.
Lord Foulkes of Cumnock (Lab)
Could the noble and learned Lord tell me what “normally” normally means?
Lord McCluskey
That depends on the context in which it is used. Normally, “normally” means “usually”—but “norm” means a standard and the main definition in some dictionaries is of conforming to a standard. I cannot understand with regard to devolved matters of legislation what the standard would be. That is why I tabled Amendment 19. If you leave in “normally”, in effect the decision on whether the circumstances are such as to allow the Parliament of the UK to legislate is one for that Parliament to take. That is the first point. In other words, I do not care who decides it, but someone must decide it.
If you do not decide it in this sort of way—namely, by giving the job to a Parliament—you will leave the job to a court. I have no idea what a court would make of the word “normally”. How would a court judge what is normal in the context of devolved and other legislation without hearing evidence? Must a court then hear a lot of evidence from constitutional experts, who are unlikely to be unanimous if today’s proceedings are anything to go by? They are not unanimous and I do not think a court would be able to rule on the matter without hearing evidence. I would hate to see the courts having to deal with this kind of matter, albeit that it would be a bonanza for lawyers—of whom I confess to being one.
The Duke of Montrose (Con)
My Lords, I support my noble friend Lord Lang in what he said. The wording of this clause reflects what I understood that Lord Sewel said in this House at the time of the passing of the Bill. It says that,
“the Parliament of the United Kingdom will not normally legislate with regard to devolved matters”.
When that was said before, I think that all of us here—my noble friend Lord Lang reinforced this—thought that it referred to Schedule 5, non-devolved matters, so that a Sewel Motion would be needed for anything discussed in this House outwith Schedule 5.
I have watched over the years as this matter has gradually crept out. The noble Lord, Lord Stephen, mentioned the various steps along which the Civil Service has progressed in making this convention. It was always a fairly constitutional matter and they were chipping away at what we understood could or could not be discussed. To just leave the wording as it is tells only half the story. We must find out what exactly the convention has developed into and what wording would describe it if we want to have it as either a convention or whatever it is. At least we have it on the Floor of the House now and can begin to look at what it should be.
Having seen the wording when the Bill was published, I asked a Written Question of my noble friend the Minister. I asked,
“how many times the Scottish Parliament has passed a legislative consent motion … regarding matters that were not at that time devolved under Schedule 5 to the Scotland Act … and in each case what reason was given”.
The Minister kindly replied with one example, but I think there must be many more. His example was that,
“section 10 of the Scotland Act 2012 made provision for certain elements in relation to air weapons to be within the legislative competence of the Scottish Parliament”,
the argument being that things that were about to be devolved should be subject to a legislative consent Motion. We need to know exactly how far this goes and what its meaning will be.
Lord Keen of Elie
The noble and learned Lord acknowledges that there would be no remedy other than a political remedy in that context, or appears to do so. He shakes his head; nevertheless, there is no remedy except a political remedy. This underlines the importance of the words “recognised as” and “normally” where they appear in Clause 2.
However, the noble and learned Lord, Lord McCluskey, spoke to his Amendment 19, a proposal that it should be expressly stated that the clause is not justiciable and does not give rise to justiciable rights. That is a matter that I would be pleased to discuss with him, albeit that the Government’s position at present is that there is no requirement to expressly state that in the context of a clause that, on the face of it, is implicitly not justiciable. That would be my position on Amendment 19.
Lord McCluskey
On that point, this provision can be put in to render the matter not justiciable, but that is in the context that the decision would in fact be taken by the UK Parliament and that decision could not be challenged in court. The point about the Sewel convention, which the Minister says is being enshrined in legislation, is that the effect changes entirely because the Sewel convention was not justiciable at all, as I understand it, whereas the statute is always justiciable. The court cannot say, “We don’t want to give it a meaning”; the court has to find a meaning because it always has to answer the question before it.
Lord Keen of Elie
In that context, it would be declaring that this is a clause that gives rise to only a political remedy, and that it was not for the court to intervene and determine whether a particular piece of legislation was normal or abnormal. That would not be an issue for the court, and that is the position of the Government with regard to the clause. That could be made clearer, or could be made express, but, as I say, I would be happy to discuss that in the light of the noble and learned Lord’s proposed amendment.
Lord Keen of Elie
In a sense, this is connected to my earlier observation that at the end of the day the clause is not justiciable. It will be for Parliament at the time to decide that it is or is not going to legislate for Scotland in a devolved matter. The term “normally” means “usually” or “generally”, but Parliament at the time may decide that it is going to legislate for Scotland in respect of a devolved matter. There is no limit on that power, as is expressly provided by Section 28(7) of the Scotland Act 1998. There is no limit on this Parliament’s sovereignty and supremacy in respect of that matter. The Sewel convention merely says that normally it will not do so; that is all.
Lord McCluskey
Does the Minister realise that if the UK Government decide that the situation is abnormal and therefore decide to legislate, and the Scottish Government go to a Scottish court and say, “We don’t agree with the judgment about normality”, the court will have to make a judgment about that if the word “normally” remains in the wording. There is no mechanism for that other than the court having to sit down and decide what it thinks Parliament intended when it used the word “normally”.
Lord Keen of Elie
With respect to the noble and learned Lord, Lord McCluskey, I do not accept that proposition. It would be for the court to say that Parliament decides whether it is normal to legislate for Scotland in a devolved matter. It is not for us to interrogate that decision by Parliament. “Normally” means just that—no more, no less. It is not for the courts to say, “We don’t think the situation was abnormal”. That is a political decision.
Scotland Bill
Lord McCluskey Excerpts(9 years ago)
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Lord Forsyth of Drumlean
To deal with the point about politicians, after I left the House of Commons in 1997—or was asked to leave by the electorate—I went to work for Flemings as a banker, and was very proud to call myself a banker. Then, when the financial crisis came along, things got so bad that I started calling myself a politician again. Then we had the expenses scandal so I decided to call myself a company director. Perhaps the noble Lord does not realise that there is a problem, not just in Scotland or in Britain but in France, America and elsewhere—you can see that in some of the eccentric choices that are being made now by the electorate—which comes from a complete contempt for the political class. At this time of all times, when money is short—and by the way, we have not seen the fiscal framework, but when the Bill goes through, money will be very short indeed in the Scottish Parliament, when it substitutes a Barnett grant for a tax base—the notion that they could find money to have an extra 40-plus politicians plus all the attendant special advisers, the machinery and the rest, is utterly ridiculous. Therefore I hope that we will not spend very much time discussing this amendment, which is a complete distraction and totally wrong.
However, the noble Lord is perfectly correct to say that there is a problem with the governance of the Scottish Parliament. Can I just gently point out who was responsible for this? When the noble Lord cited all these examples of failures of policy—I could add considerably more—where was the Labour Party? Where was the opposition in the Scottish Parliament standing up to all of this? Therefore the fault did not lie in the lack of a second Chamber but in the opposition to the SNP and in the case of my own party, which gave it the ability to be in government by supporting it in government, some criticism could be made. However, this is not an argument for a second Chamber but for having vigorous Members of the Scottish Parliament, who I hope will be elected in May, doing the job they are required to do.
As regards numbers in the proposals there is already great confusion—we will come on to this later in the Bill—about the boundaries of constituencies and responsibilities. I was very struck by a poll by ITN, when it discovered that some huge number of the Scottish electorate—90%, I think—had absolutely no idea what powers were going to be conveyed by the Scotland Bill on the Scottish Parliament. When asked, a similarly higher percentage—well over 50%—were of the opinion that whatever the powers were, they did not go far enough. Therefore there is a job to do for the Scottish Parliament in engaging with the electorate and a job for the opposition. It is true that they are failing in a wide range of policy matters, but a House of lairds—a bunch of people calling themselves senators—will not resolve this problem. Fortunately, however, it is not a problem for this House but for the Scottish Parliament.
Lord McCluskey (CB)
My Lords, I may be brief. I made points in my Second Reading speech which the noble Lord, Lord Lyell, has referred to. We are all agreed about one thing: there is a problem. Whether the unelected House of Lords is the right place to start giving a lead in that matter is something entirely different. I would not fashion the problem in precisely the words that the noble Lord, Lord Foulkes, has mentioned—the one-party state. I think I have previously used the expression that was made well known by Lord Hailsham, “an elective dictatorship”, because in substance that is what you have in the Scottish Parliament at the moment. The Scottish National Party, for its own reasons, whips its MPs so effectively that there is no dissent, and for reasons that I mentioned at Second Reading, the weakness of the opposition is palpable. There are good people and, by the way, one or two good committees as well, but the committees of which I have experience, which are largely to do with justice, are not satisfactory.
I therefore agree with the noble Lord, Lord Maxton, that there is a problem with having an elected House. The great thing about the House of Lords is that it is not elected, therefore we are not answerable to constituents, and because very few of us are left with ambition, having reached an age and a state in our careers when ambition is no longer available to us, we can say what we think. However, that is not a popular idea in the country generally.
I am not sure that I am totally committed to the idea of an elected second Chamber but there must be some system. One forgets that many of the institutions that are extremely powerful in shaping the political debate and the political results in this country are not elected at all. I mention, for example, the press, which is said to be free and independent. It may be free, and it is independent of government, but in no sense is it elected by anyone. I get no say in who appoints the editors of the Times or the Sun or, for that matter, the Daily Mail, and they have considerably more influence than this House over what happens in this country, but they are not elected either.
This may be just a start but I feel that there is a duty on those of us who share the idea that there is a real problem to publicise that problem in Scotland and to try to persuade the Scottish electorate and the people generally that it has to be tackled, although perhaps not in this way. However, I certainly support the idea that “something must be done”—an expression which I hesitate to use because of its antecedents.
Lord Purvis of Tweed (LD)
My Lords, it was fairly dispiriting to come back into the Chamber and to see our archaic language—which, as a Member of this House compared with being a Member of the Scottish Parliament, it has taken me a while to adjust to—on the annunciator. It announced that the House was “Adjourned during pleasure”, and it was dispiriting when the “pleasure” ended and the Scotland Bill was brought back to us. When I first saw that announcement on joining this House, I asked the Clerk of the Parliaments was it was. He asked me, “Didn’t you have any pleasure in the Scottish Parliament?”. I replied, “No, not very much at all”.
It was a pleasure to hear the noble Lord, Lord Foulkes. His persuasive skills are renowned but I am afraid that I am not persuaded by the case that he made. When I was a constituency Member of the Scottish Parliament, I considered it to be absolutely my duty to be as effective in that role as anyone else, but I was also aware of the pressures on constituency and regional Members of the Scottish Parliament. At one time, I was a member of three parliamentary committees: two were legislative and one—the Finance Committee—was both a scrutiny and a legislative committee. There was most certainly a strain on the number of Members.
It is worth reflecting that it was not designed to be like that. When the Parliament was established and the consultative steering group looked at the fundamental principles of how the Scottish Parliament should operate, it was designed to be a very different type of institution from the one here. There was going to be much stronger pre-legislative scrutiny and that element has been successful. This Parliament has learnt from that approach to pre-legislative scrutiny, with draft Bills now becoming the norm.
The committees in the Scottish Parliament, because of its nature, are both legislative and scrutiny committees. They were designed to be the strength of the Parliament. In a previous element, the noble Lord, Lord Forsyth, said that the Scottish Parliament sits for only one and a half days. When I was a Member of that Parliament, that was a frustrating misconception reinforced by some of the press, which I felt had an agenda against the Parliament. There were plenary sessions but, unlike in this place, the committees in the Scottish Parliament had precedence. They met on Tuesday mornings, Tuesday afternoons and Wednesday mornings because of their distinct role.
The feeling was that the convenors of committees were going to be equal to Ministers and that their parliamentary strength was going to be in balancing the Executive’s authority. There was to be a shadow civic Parliament, with a much stronger civic input into the way that the Parliament operated. It is disappointing—there is a mea culpa from my party, which was part of the Administration early on, but it has most certainly been accelerated since 2007—that the Scottish Parliament has become remarkably like the Westminster Parliament. It has an absolutely dominant Executive and the committees have gradually become weaker. Their convenors are not even elected by the whole Parliament—an innovation of the House of Commons. The procedures of the Parliament have become weak in relation to power over the Executive when it comes to money. If there is anything that the Scottish Parliament can learn from our experience now, it is that Parliaments that reduce the ability to hold government to account for the money that it spends on behalf of the people are weakened Parliaments.
Ultimately, that has meant that there have been some examples where there has been less scrutiny than I, as a former Member of the Parliament, would have liked—whether that is on police reform, where mine was the only party to vote against what has happened because there was a large majority and the Executive were able to take it through; criminal justice reform; two areas that are currently being challenged by Brussels, on the Scottish Futures Trust and the delivery of infrastructure; minimum unit pricing, which has been challenged; or the quality. Fundamentally, these are my observations as a former Member who loves that institution, wishes it well and was a very proud Member of it.
However, I agree with the noble Lord, Lord Forsyth: it is not for this place to tell that institution what to do. If this place is to have a role—I know that members of the major party in Scotland will never accept that, and I understand the reasons for it—it is sometimes for former Members of the institutions with deep respect say to that institution that it is worth it considering its own procedures. I live in the area that I used to represent as a Member of the Scottish Parliament, and so I maintain a vested interest in that Parliament working well.
There is a case for some form of much heightened, strengthened pre-legislative scrutiny. Sir David Edward, whose qualifications I do not need to rehearse, argued in a very good lecture for a council of state, using the existing organisations that we currently have set up in Scotland—for example, the ombudsman—to be a much stronger check on the proposals being put forward. Corroboration is one area where there should have been stronger pre-legislative scrutiny.
Equally, I believe that there will increasingly be an argument for some form of check before the final stages of Scottish Parliament legislation. If there is a reformed House of Lords, it could be that we have a mandate from the Scottish people directly, or indirectly through the Scottish Parliament for senators in this place, and may well have some joint capacity with both the UK and Scottish Parliaments—I will not need to address the next amendment, which deals with the working relationships, because this is my point. Noble Lords may not be entirely surprised to hear me say that, ultimately, that should be one area that we consider in a constitutional convention: to look at the proper functioning and continued strengthening of how the Scottish Parliament operates and the areas where this institution should rightly have a relationship with it. Ultimately, we should seek a better, stronger Scottish Parliament, able to do its job.
Therefore, I am not persuaded by the solution that the noble Lord has brought forward, but I hope, with the deepest of respect to the institution that I love, that it takes it very seriously, especially in the context of the successful passage of this Bill, in which the Scottish Government’s powers over budget and taxation will be greatly enhanced.
Lord McCluskey
Lord McCluskey (CB)
This is a technical matter, and it is not worth taking up time on it at this time of night. Accordingly, it is not moved.
Lord Stephen
At this late hour, I am happy to confirm almost anything to the noble Lord.
Lord McCluskey
My Lords, in view of the terms of Amendment 33, I shall not be moving Amendment 32.
Lord Davidson of Glen Clova
My Lords, this has been a brief and helpful debate about the question of the supermajority. We do not oppose the various amendments that have been tabled.
We agree that the amendments tabled by the noble and learned Lord, Lord Hope, are technical and doubtless useful in taking matters forward. It would be useful to know why he is in the position of having to advance notions that the Scottish Government would wish this Chamber to advance. We were hearing not so long ago about the good relations that were breaking out at intergovernmental level, which might suggest that these various amendments would have been brought forward by the Scottish Government to Her Majesty’s Government and that, as a result of intergovernmental discussion, one would have been able to achieve some consensus on these points. We look forward to seeing if the improvement in intergovernmental relations takes us that far.
The noble Lord, Lord Stephen, introduces two amendments in relation to parliamentary terms and the supermajority. We support those additions. On the question of the deployment of the European Convention on Human Rights, where the Scottish Government transgress in this regard there will be the protection of the Advocate-General for Scotland raising proceedings before the Supreme Court, but also the Lord Advocate—a Minister of the Scottish Government, as I have already alluded to—as well as the Attorney-General. We certainly do not oppose these amendments; we support them.