Northern Ireland Finances

Lord Reid of Cardowan Excerpts

Tuesday 13th March 2018 Lords Chamber

[Lord Duncan of Springbank]

I thank the noble Lord, Lord Maginnis, very much for his trenchant intervention. The noble Lord is right to point out that, sitting in your Lordships’ House are a number of architects of the Belfast agreement, and that the knowledge contained within these four walls should be drawn on now as we begin to enter this phase of maximum danger, when we need to be able to deliver an outcome that works for the people of Northern Ireland.

I am reminded again of the remarks by the noble Lord, Lord Empey, on these issues the first time I stood here at the Dispatch Box. He said that it is very easy to walk down the steps of Stormont; it is very hard to walk back up. Of course, he was alluding to the challenge of direct rule.

We hope to—and we will do all we can to—bring a rapprochement, by whatever method we can, to the parties who are needful in delivering this particular serious outcome. In addition, I note that the noble Lord, Lord Maginnis, passed me information that I have taken away, and we will certainly look at that in greater detail. I may come back to that on a later occasion.

[Lord Reid of Cardowan (Lab)]

My Lords, I welcome the very definite commitment in this Statement again to the Belfast Agreement and to the principles that underpin it. It is worth reiterating that at every opportunity in view of some of the voices off, which I do not think have been particularly helpful. I ask the Minister to very much bear that in mind when it comes to the seemingly innocuous phrase:

“It would be irresponsible for us not to consider how we might provide for different arrangements until such times as the Executive is back”.


I am not opposed, nor would any Member of this House be opposed, to discussing how to move things forward, but I think, with the benefit of hindsight—some people, such as the noble Lord, Lord Empey, might say “with foresight”—that some of the changes we have made from time to time to the mechanics of the operations of the Executive have not always been conducive to encouraging the coherence and the spirit of the Good Friday agreement. There are risks and dangers in that innocuous phrase.

[Lord Duncan of Springbank]

I thank the noble Lord, Lord Reid, very much for again bringing his knowledge to the discussion. He is absolutely right to speak of the voices off and the noises off. We have to turn them off; it is unhelpful right now. We need to focus on what we believe we require, which is securing again the Belfast agreement at the heart of the restored institutions in Northern Ireland. I am happy to emphasise that again whenever I am called on to do so.

Again, it is telling that the noble Lord is willing to reflect on his own time in office. It is rather like lifting the bonnet of a car. I have no idea what happens under there. You start tinkering at your own peril. It is amazing what harm you can do when you have less experience of what is under there. That is not to say that we need not be careful about how we move forward. None the less, we should be progressive. The reason my right honourable friend was very clear in her Statement is that we need to recognise that, at this time of challenge, we must have a means of securing those voices in the essential and ongoing discussions. Noble Lords will be aware that in the next few days we shall return to a number of the devolved elements of the withdrawal Bill. When we talk about these essential issues here in our House, I am again minded of the deafening silence from the Executive, which does not sit, and the Assembly, which cannot speak. I am mindful of the warning from the noble Lord but at this moment we need to find ways to secure progress. As I have said, I do not believe we can take anything off the table.

Northern Ireland Update

Lord Reid of Cardowan Excerpts

Tuesday 20th February 2018 Lords Chamber

[Lord Reid of Cardowan (Lab)]

My Lords, the Minister is working, through no fault of his own, in some very dangerous circumstances. I think they are even more dangerous than some of the experiences my noble friend Lady Smith outlined. Let me put it this way: will he now take the opportunity to respond to the question contained in my noble friend’s opening remarks and distance himself, unequivocally, from any sympathy or support—even any understanding—for those who have called in the past few days for the unravelling of the Good Friday agreement, or the Belfast agreement? I say this because, without casting any aspersions, if one of the parties causing the deadlock is also now, apparently, calling for direct rule by the British Government and is the same party that is propping up the British Government, and has now gone further with some of its members calling the Belfast agreement “unsustainable”, there cannot but be suspicions that this had an effect on the conduct of these negotiations. Will he therefore make it absolutely plain that the Good Friday agreement, which has now been in place for two decades and resolved problems of tragic conflict in the island of Ireland that lasted for several centuries, will be maintained, in the spirit and the letter, by this Government?

[Lord Duncan of Springbank]

I thank the noble Lord, Lord Reid, for his question. He is right to raise it once again. I will be unequivocal and as plain as I can be: this Government do not support any of the remarks made by those who believe that the Belfast agreement is in some way dispensable, erodible or dismissible. It is not. It is the cornerstone of our approach and of bringing about a restored Executive. I am happy that the noble Lord has given me an opportunity to make that point very plain.

Northern Ireland

Lord Reid of Cardowan Excerpts

Thursday 2nd November 2017 Lords Chamber

[Lord Duncan of Springbank]

The noble Lord is absolutely right. The things that people are most concerned about are the elements of good government through a sound and stable economy, housing, education and the wider welfare question. It is the ambition of this Government to deliver a strong, stable and sustainable Executive who can address those self-same points. As a former Member of the European Parliament, I have always believed in the notion of subsidiarity: we should deliver those things as closely to the people they affect as we possibly can. I believe that we can do that in the Executive.

The noble Baroness, Lady Suttie, made a strong point when talking about the people of Northern Ireland and the indomitable and unsurpassable efforts they have made to move forward. I believe that right now they are watching all of us to make sure that we are hearing their points. I hope that the self-same voices are being heard around the table. It is absolutely critical that the two principal groups at that table should find a way of securing common ground because it is on that common ground that firm foundations will be laid for the ongoing good governance of Northern Ireland. Only by having good governance can we actually hope to deliver the things which I know are dear to the noble Lord’s heart, which is the welfare of the common people. I believe that that must also be at the heart of our ambitions as a Government.

[Lord Reid of Cardowan (Lab)]

My Lords, it is at times of deadlock like this that we again have cause to regret the passing of the late Ian Paisley and the late Martin McGuinness, but we are where we are. I believe that the Secretary of State had no option but to do what he has done, and correctly to say that it is a regrettable necessity rather than a desirable option. It was also wise of the Minister and the Secretary of State to point out that this is for one year only. An assessment of the decisions on the distribution of the funds will be made on the basis of the Northern Ireland Assembly. However, it does not mean that there is no role for the Government in the oversight of this. Nothing would be worse than if there were a maldistribution of those resources, ignoring equality of opportunity to all the communities in Northern Ireland. Can the Minister assure us that although they will not be making the decisions, they will not be blind to the effect of those decisions for the future?

[Lord Duncan of Springbank]

The noble Lord, Lord Reid, makes a very important point. The budget for the financial year coming up has been set on the foundations of the previous outgoing Executive and on the advice of the Northern Ireland Civil Service. At the heart of that must be a recognition of balance and fairness for all the people of Northern Ireland. There can be no point at which there is maladministration, misdirection or anything of that sort. The heart of our ambition, if we are called upon to move the budget forward, is to secure a fair and equitable settlement for all the people. In that way, when they see what is going on they will recognise that that is a proper outcome. But again I would emphasise that the future rests in the hands of those who are sitting at the table now. When they are able to determine a common ground for the next stable Administration to be formed, they can begin to grapple with the very challenging issues which I know exist in Northern Ireland across a whole range of areas. We cannot simply roll over that which emerged from the previous outgoing Administration because it will not work in the long term. We can move forward on that basis for the financial year ahead, but we cannot do so for ever.

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[Lord Duncan of Springbank]

I would argue that that decision must rest with the Northern Ireland Executive. It is not in any way for the UK Government to determine what the spend should be in that particular area. That is why I come back to the point and stress that the milestone we are talking about right now is ensuring that the budget that has been determined moves forward, to stop a situation occurring in November where the resources run out. That is the critical element. It must be the Northern Ireland Executive who determine the priorities that will arrive through the money from the supply and confidence relationship. In the interests of all communities, that must be how it goes forward.

[Lord Reid of Cardowan]

Will the Minister explain whether the £1 billion extra going to Northern Ireland is excluded from this budget consideration?

[Lord Duncan of Springbank]

I am very happy to say that yes, it is excluded.

Scotland: Fiscal Framework

Lord Reid of Cardowan Excerpts

Wednesday 16th December 2015 Lords Chamber

[Lord Dunlop]

This is a very important agreement and all sides are agreed that this is a critical part of the overall settlement. It is important to get this agreement right. We want an agreement that is fair to Scotland and to the UK as a whole, and which is built to last. The important thing is to get the agreement right.

[Lord Reid of Cardowan (Lab)]

As my noble friend Lord Gordon pointed out, the fiscal framework underpins every important implication of the decisions that this House and the other House have been asked to take. If it is wrong, it will have the most serious consequences not just over a period of time but over decades. I am afraid that the Government are approaching this with all the alacrity of their deciding on additional airport capacity. However, the difference is that this House has been asked to consider this before we know the fiscal framework on which it will all be based. Can he not at least assure us that there will be no concluding stages of this legislation until the fiscal framework is available to Members of both Houses of Parliament?

[Lord Dunlop]

We have reordered the Bill so that the parts most relevant to the fiscal framework will be dealt with at the end of Committee. As I said at Second Reading, that gives us the time and space to reach agreement, so that this House can give the agreement full scrutiny.

Scotland Bill

Lord Reid of Cardowan Excerpts

Tuesday 24th November 2015 Lords Chamber

[Lord Dunlop]

I seem to have heard “plan B” somewhere before. I say to the noble Lord that we are planning for success here. We working for success and the UK and Scottish Governments are saying the same thing. We are working constructively together to reach an agreement as soon as we can and good progress is being made.

[Lord Reid of Cardowan (Lab)]

I would just like to probe a little on the Government’s view that it is unhelpful to have a timeline for this and to envisage potentially indefinite discussions. I heard what the Minister said about unilateral declarations of times being unhelpful, which surprised me because the vow, of which he has spoken very much, unilaterally declared three timetables: St Andrew’s Night, Burns Night and so on. I wonder why the Government have changed their mind. Would it not be helpful at least to have some indication of the timescale in which they would hope to reach agreement? I declare an interest as a former Secretary of State for Northern Ireland, where things tended to drift on for years rather than months.

[Lord Dunlop]

I thank the noble Lord. In broad terms, the Scottish Government and the UK Government are working in sync on this. On Friday, the Deputy First Minister, John Swinney, said,

“I think fundamentally we need to make progress on the Scotland Bill so that the Scottish Parliament can take its final decision on whether the bill is to be adopted before we get to the Scottish Parliament elections next May”.

Our firm intention is for the fiscal framework to be available to both Parliaments before the Bill completes its passage.

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[Lord McAvoy (Lab)]

My Lords, I thank the Minister for the way he introduced the Bill and for the always constructive manner with which he approached initial proceedings. On that basis, I am confident that this House will be able to have a positive impact on the Bill. I look forward to working with Members from across the Chamber to ensure that this happens.

I also thank my noble friend Lord Hollick for the crucial work that he and other members of the Economic Affairs Committee have done in producing this incredibly detailed and important report on the relationship between the proposals outlined in the Bill and the revised fiscal framework. I will address the fiscal framework and outline the Opposition’s position later in my speech, but suffice it to say for now that it is incredibly disappointing for everyone that we do not have draft proposals to consider alongside the Bill. I do not want to pre-empt the debate, but I am sure that if a Joint Committee could redouble its efforts to proceed at the quickest pace possible, without compromising on consensuality and scrutiny, it will be warmly welcomed by colleagues across the House.

By any standards, it has been an extraordinary 18 months for Scotland. Today is yet another milestone in the history of Scottish devolution. The referendum was certainly unlike any political campaign that many of us have ever been a part of, invigorating political debate across party and generational divides. The Scottish people voted to remain part of the United Kingdom, not on the basis of a return to the status quo, but in a belief that they would be a member of the union with an enhanced role in how to govern their lives. Here is also the best place I can think of to record, once again, my and our appreciation for the right honourable Alistair Darling’s chairmanship of Better Together; the absolutely brilliant managerial work carried out by my friend, Frank Roy; and the invigorating intervention by the right honourable Gordon Brown.

I mentioned giving the Scottish people an enhanced role in how to govern their lives. The Bill is that change and it delivers on the promise made. It is important to acknowledge from the outset the unique challenge that this House faces, given that the party of the majority of Scotland’s current elected representatives does not have a voice in this Chamber. It is something to which we must be wise as we debate the Bill. That said, we on this side will not shy away from what needs to be done to ensure that the Bill is as effective and workable as it can be. The decision by the Government to accept so many of our amendments, and those of other opposition parties, on Report in the other place was an essential part of this process. As a result of these concessions, we are confident that the vow has been delivered and that the Bill fulfils the powers promised and agreed by all parties in the Smith commission. The noble Lord, Lord Smith of Kelvin, has stated that the Bill, as amended,

“honours the agreement that was reached”.

The House will be aware that before the Government introduced its amendments we on this side of the House felt that the Bill fell well short of the commitments the main political parties had given to the Scottish people. However, following these crucial concessions—it must be recognised that the Government have moved from their original position, particularly on social security—the Bill now delivers on the vow and the Smith agreement in both spirit and substance. Her Majesty’s Opposition, therefore, fully support the Bill and all it seeks to achieve. As my honourable friend Ian Murray has stated,

“the Bill really matters, because it guarantees not only economic benefits and UK social solidarity, but the scope under devolution to do more, to make different choices and to set a different course for Scotland, distinct from a UK agenda that might not always be … in accordance with the public opinion of Scotland”.—[Official Report, Commons, 8/6/15; col. 933.]

The Scottish Parliament, as has been said, will be one of the most powerful devolved legislators in the world. This presents a huge opportunity for Scotland. Not since the Scotland Act 1998 has there been a bigger transfer of powers. It is now up to the Scottish Government to ensure that these powers are used for the benefit of the Scottish people. The permanency of the Scottish Parliament and Government is now beyond question and, as a result of another Labour amendment, the Government have removed any UK ministerial veto on the new regulation-making powers on universal credit. Along with constitutional changes, the Bill also devolves power over electoral matters to the Scottish Parliament.

I am glad to say that significant headway has also been made on gift aid, following a great deal of concern from Labour and third sector organisations that changes to income tax levels in Scotland could cause considerable confusion among charitable donors, and financial and administrative problems for charities. The Secretary of State has committed to,

“an ongoing dialogue with the charity sector before and after the enactment of the Bill to ensure that gift aid continues to operate effectively”.—[Official Report, Commons, 9/11/15; col. 100.]

We fully endorse this.

From April 2017, the Scottish Parliament will have total control over the rates and thresholds of tax on non-savings and non-dividends income. Following the acceptance of the Labour amendments, the Scottish Government will now be able to create new benefits in devolved areas and top up existing reserved benefits, including tax credits. These substantial new powers will enable Scotland to raise more than 50% of its own expenditure and to design a new social security system. It will allow the Scottish Government to restore, if they so choose, the loss in tax credits for working families, just as the Scottish Labour leader, Kezia Dugdale, has committed to do.

As part of this welfare package, we were pleased that the restricted definition of carer’s allowance was removed from the Bill. This will mean that there is significant additional scope for the creation of a new, more generous and more expansive, benefit. However, it was disappointing that the Government did not table a similar amendment with regard to disability benefit. That brings me to the areas of the Bill where we still think improvements can be made.

Although the Government’s welfare concessions are warmly welcomed, there remain further measures which, if introduced with enhanced provisions, would clear up some of the Bill’s inconsistencies. One area of concern is the definition of disability benefit, as I mentioned. At present, that definition is overly restrictive and could place unnecessary limitations on the kind of replacement benefit the Scottish Government have the power to introduce. Despite the similarity between the amendment and the one pertaining to carer’s allowance, the Government failed to table the requisite amendment in this area—we are not certain why. The devolution of the Access to Work scheme is another area where there should be further debate.

Beyond the two specific measures that I have highlighted, it is paramount that a smooth transition is afforded for all the welfare provisions that are to be devolved with the passing of this Bill. Labour believes that the most effective means of ensuring this is the establishment of a Joint Committee on welfare devolution. The committee would oversee the transition and implementation of welfare powers and include Members from both Parliaments. Such a committee would be completely open, impartial and transparent. Transparency is something we regard as having been lacking in discussion so far, particularly in the negotiations surrounding the fiscal framework, an issue I expect to dominate much of our debate today and the remaining stages of the Bill. The Scottish Government have been quick to claim that the Bill will be rejected if the accompanying funding is “not fair to Scotland”. However, they have been slow to produce accounts of the meetings that have taken place so far.

The Joint Exchequer Committee between the United Kingdom and Scottish Governments promised that an agreement would be reached by the autumn. However, as has been said, we now understand that the negotiations will not be completed until January at the latest. This is disappointing. It is vital that agreement on the revised framework is reached on a consensual basis and in a timely manner, as well as being made more formal and transparent. This is something that we will be looking to pursue and explore during the passage of the Bill through your Lordships’ House.

[Lord Reid of Cardowan]

I congratulate my noble friend on his presentation. He has tiptoed through some very big thistles—with some aplomb, if I might say so. On the question of reaching an agreement on the fiscal framework, I think the whole House would be unanimous, whatever view we take on the amendment, that that is desirable. Should it not be reached by the time we get to the latter stages of the Bill, does he have a view on how we should address it?

I fully understand that we are caught between a rock and a hard place because we have made a promise. Some of us take the view that that was a strategic masterstroke; some of us, like me, think it was a tactical ploy that turned into a strategic disaster, and we are now facing up to it. Nevertheless, whatever view we take—I am personally of the view that we are where we are now and we have to go on with this—how do we go on with it if we do not have the fiscal framework, which, it seems, would lead not to a sustainable agreement but to years and perhaps decades of future grievances? I hope I have given my noble friend the time to respond to me.

[Lord McAvoy]

My noble friend is as helpful as ever.

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[Lord Wallace of Tankerness (LD)]

My Lords, we on these Benches very much welcome the fact that we now have this Bill before us and congratulate the Minister on introducing it.

Many times before today, and already in this debate, the history of the Bill has been well rehearsed. Reference has been made to the agreement among the three party leaders and the fact that on the morning after the very successful outcome of the referendum—which showed that the people of Scotland did, by a significant margin, wish to remain part of the United Kingdom—the Prime Minister announced the establishment of the commission under the chairmanship of the noble Lord, Lord Smith of Kelvin. I am delighted to see the noble Lord with us today. As has been said, there was a very exacting timetable for the publication of the commission’s proposals, which were due before St Andrew’s Day last year, with the draft clauses due before Burns Night. I had some engagement in those days with the Scotland Office, the Cabinet Office and the Treasury, and the work that was put into meeting that particular deadline is a great tribute to the staff. Since then, in the light of further discussions, there has been some refinement of the clauses, but we on these Benches believe that the commission’s recommendations and proposals—taking forward, as they did, the agreement among the three party leaders—are delivered in full in this Bill we have before us. The noble Lord, Lord Smith of Kelvin, has also indicated that, and we look forward to hearing more precisely what he thinks about the detailed provisions of the Bill.

We also support the Bill because it is a further step along the road to federalism, which for my own party has been the ultimate destination for many years. Indeed, the Scottish Liberal Democrats’ contribution to the Smith commission was based on Federalism: The Best Future for Scotland, the report produced by a commission chaired by my noble friend Lord Campbell of Pittenweem. We very much look forward to hearing his maiden speech today. He brings to this House great expertise and experience, not just in politics but also outside politics, in particular on this subject. We also look forward to the maiden speech of our fellow member of the Faculty of Advocates the noble Baroness, Lady McIntosh of Pickering.

While it is important that we support this Bill, as the noble Lord, Lord McAvoy, echoed, the House must do its job properly—a job of proper scrutiny. I think that is more incumbent on us, given that the three principal parties actually agree on the Bill. As I said at our briefing last week, I think we should be haunted by the Child Support Agency which went through Parliament with the support of all parties. Those of us who were Members of Parliament at the time know how much our constituency mailbags and surgeries expanded because, I think, something that was agreed by all parties did not perhaps get the scrutiny that it should have had. If we seek to improve on the Smith commission proposals and do so in the spirit of the commission, then we should feel that we can certainly do so.

[Lord Reid of Cardowan]

In fairness, since the noble and learned Lord said that we have to give this scrutiny, I should ask him the same question that I asked my noble colleague here. How can we give it scrutiny if an essential, central, crucial part of it—the fiscal framework —is not available for us to scrutinise? Does he have a view on how it might proceed? My noble friend gave us his view that we should have a degree of trust and wait to see how things develop. Does the noble and learned Lord have a view?

[Lord Wallace of Tankerness]

My Lords, I do. If I start answering that partly now, I will probably end up repeating myself. I certainly will address the point that the noble Lord, Lord Reid of Cardowan, asks.

I see the Bill as having a number of different parts, dealing with constitutional issues, fiscal issues, welfare issues and what might be described as miscellaneous provisions issues. On the constitutional issues, the commission recommended that,

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

and that,

“The Sewel Convention will be put on a statutory footing”.

Clause 1 of the Bill does indeed state that the Scottish Parliament and the Scottish Government are permanent institutions, and it is claimed, as the Minister said, that it should not encroach on the sovereignty of Parliament. I certainly believe that federalism would be a better guarantee of the long-term establishment and entrenchment of the Scottish Parliament, but that is not on offer—it was not before the Smith commission.

During the Scottish Constitutional Convention—there are a number of noble Lords present who were party to that convention—we had many agonising debates as to how we might best entrench the Scottish Parliament that we were intent on establishing. We came to no really good conclusion. When the Labour Party, in Opposition in 1996, recommended and proposed a referendum, my party colleagues and I were opposed to that. In retrospect, I think we were wrong. The fact that we had a referendum in 1997 with such an overwhelming result—both on the Parliament itself and on its tax powers—means that there was a political entrenchment that no amount of legal debate, legal argument or legal wording was ever going to establish. While it is undoubtedly the case that, technically and legally and in constitutional theory, Parliament can repeal what has been said here, nevertheless the fact that it is suggested that there should be a referendum before there is any abolition of the Scottish Parliament lends a political entrenchment which is very welcome indeed.

With regard to Clause 2, I note that what is in the Bill is almost literally what the commission proposed—that it should put on a statutory footing the Sewel convention—because it states:

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

Those are the words that Lord Sewel used on 21 July 1998. Of course, in practice, legislative consent Motions have been extended by Devolution Guidance Note 10 to include Bills in the United Kingdom Parliament which confer new powers or responsibilities on Scottish Ministers and the Scottish Parliament. By definition, if we are conferring new powers, the powers cannot already be devolved. My question for the Minister is: why is the clause limited to the very narrow, literal expression used by Lord Sewel in July 1998? In practice, that wording plus Devolution Guidance Note 10 has worked. Strictly speaking, this Bill does not require a legislative consent Motion because it is conferring new powers on the Scottish Parliament. Are two categories of legislative consent Motions envisaged and, if not, why not just put the whole practice of legislative consent Motions on to the statute, rather than limit it to the words of Lord Sewel during the passage of the Scotland Act 1998?

With regard to welfare powers, we believe—and it was reflected in the outcome of the Smith commission report—that it is consistent with the principle of securing a social union that many welfare benefits are rightly reserved to the Westminster Parliament, but we support the proposals for the Scottish Parliament to have power to create benefits in the areas of its devolved responsibility: housing, carers, disabilities and discretionary payments in areas of welfare. As the noble Lord, Lord McAvoy, said, no doubt they need to be looked at in more detail so that they deliver what was said on the packet, and we will certainly do so.

It is also important to remember that with that power goes responsibility. There is not much point if people go around promising more in terms of top-up benefits unless they are prepared to say where the money will come from to pay for them. It is an inevitable consequence of having a mixed welfare system—partly devolved, partly reserved—that the Scottish Government and the United Kingdom Government will have to work more closely together. That in itself cannot be a bad thing; we hope that it will generate more collaborative working than we have sometimes seen in the past.

The amendments made in the other place have to some extent taken away the concern that there was a veto, which is welcome. I always thought that the veto case was totally overstated. I think it is a question of practicality. I remember that when I was in the Minister’s position of having to answer to your Lordships’ House, I asked: “What is actually meant by this?”, when we were dealing with the draft clauses. The example given to me was: “If the Scottish Parliament decides that it wants to have a top-up benefit for left-handed redheads, frankly, the social security system does not have a database for that, so we could not agree to it until such time as we had one”. It was therefore not unreasonable that such a mechanism was included to allow the practicalities to be resolved.

There are one two other specific provisions. The commission recommended that there should be,

“a formal consultative role for the Scottish Government and the Scottish Parliament in designing renewables incentives and the strategic priorities set out in the Energy Strategy and Policy Statement”.

Clause 58 refers to “Renewable electricity incentive schemes”, but it does not refer to heating schemes. I am not sure that any explanation has been given as to why heating schemes should not be included, given the wider remit of the Smith commission proposals.

I echo some of the comments made by the noble Lord, Lord McAvoy, on equality. However, I think it is important that we ensure that the basis of equalities legislation in the United Kingdom is in no way diluted through devolution.

With regard to the Crown Estate, the commission recommended that there should be devolution of management to the Scottish Parliament—or, more practically, to Scottish Ministers—and onward devolution to the communities of Orkney, Shetland and the Western Isles, and indeed, other local authorities. Many of us here are hugely suspicious about whether a Government in Edinburgh who seem to spend all their time centralising, as the noble Lord, Lord Maxton, said during Questions today, will actually adopt the spirit of decentralising power further. The noble Lord, Lord Smith of Kelvin, in his personal comments on the commission, stressed the importance of devolution going beyond Edinburgh. We may wish to examine amendments along the lines of those moved by my right honourable friend Alistair Carmichael in the other place to leapfrog, as it were, and genuinely ensure the empowerment of local communities.

Turning to the fiscal powers, we now have full income tax, aggregates tax, air passenger duty—the latter, too, having been recommended by the Calman commission on which I served. Can the Minister indicate why aggregates tax is included now? We did not include it before because we were awaiting judgments from the European Court of Justice. An update on where we are on that, and why the Minister thinks it is possible now when it was not in previous legislation, would be welcome.

We owe it to your Lordships’ Select Committee on Economic Affairs to respond to the report that it has given us, which undoubtedly has aroused some controversy. I certainly understand and recognise the frustration that we do not yet have the fiscal framework. In response to the noble Lord, Lord Reid of Cardowan, I believe that it is important that we should have sight of that at some stage in our proceedings, but I just utter this word of caution. We cannot do this in a political vacuum. Delaying the Bill at this stage would effectively give the SNP Government a veto on the progress made, and that would not be particularly desirable either. The Minister said that John Swinney was on record saying that he wanted this agreement. We must take that at face value, but, equally, those of us who are immersed in Scottish politics well know that, if something went wrong and we did not manage to reach agreement, they are the masters and mistresses of turning that to their account, and the finger of blame would point unequivocally at your Lordships’ House. Those who have made milking grievances a master art would be only too pleased to have a narrative of betrayal.

[Lord Reid of Cardowan]

I have a great deal of sympathy with what the noble and learned Lord says, because, on the one hand, we have the cause of rational scrutiny, and on the other the imperative of politics—of keeping a vow. My worry is actually politics: I worry that, in capturing the minutes, we will lose the hours. In other words, if the criticisms being made are correct, then we might have a political storm at present if we were to do as was suggested and in any way delay the Bill, but if the criticisms are correct, we will have decades of such grievances and political problems in future. I probably come down on the same side as the noble and learned Lord on this: the imperatives of the politics are necessary today, but it is essential that the Government recognise that this fiscal framework has to come back at some stage before we get to the end of this process. Otherwise, we are having to make the devil’s alternative choice.

[Lord Wallace of Tankerness]

My Lords, nothing I said takes away from what I said at the outset: that it is very desirable that we see the fiscal framework. The Government should take from all sides of the House that there has been a view to that effect. While I think it is nonsense to expect the Government to reveal their negotiating hand in this debate, it is not unreasonable to ask, perhaps, for more transparency to show that progress is being made, and for the Government to enunciate some principles as to what they wish to see in the fiscal framework.

For example, one hopes that the Government’s negotiating stance is to seek fairness on all sides—for Scotland and the rest of the United Kingdom. Their role is to take in the whole of the United Kingdom, not just the rest of the United Kingdom. The no-detriment principle should be at the point of devolution: that there is no detriment one way or the other when a particular tax is devolved. There should be a form of indexation—I do not underestimate the difficulties, but it should be one which in itself is neutral, with an automatic mechanism to avoid an annual row.

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[The Marquess of Lothian]

I think I will have to take that as being as near to an apology as I will get from the noble Lord, Lord Foulkes.

[Lord Reid of Cardowan]

I am grateful to my noble friend Lord Foulkes for recanting, as he should on a number of issues. This is the third time that the accusation that somehow devolution would not deter or kill nationalism, which in its ultimate expression is separation, has been mentioned. Will the noble Marquess reflect on what might have happened in the recent referendum had we not had devolution? We would now be a broken union because I have no doubt at all that if the aspirations of the Scottish nation to have more control over its own affairs had been denied for generations over this century and the previous century, we would not have had the result we had, which was to retain the United Kingdom but with devolution inside it. I ask him to reflect on that before he repeats what is becoming a cliché throughout the House.

[The Marquess of Lothian]

I am very happy to reflect on it, but I make the point that had we not had devolution, I doubt whether we would have had the referendum because the basis for having the referendum would not have been there. A little later in my remarks I will deal rather more fully with what the noble Lord has just said.

Another thing that has interested me about this debate is how unpartisan it has been. In different parts of the House, people have taken the same view, but differing from that in other parts of the House. That is a very interesting factor in this debate. This is not a party issue. The Committee will therefore be of great interest.

I shall pick up one or two points that were made. First, we have heard a lot about the fiscal framework. I look forward to seeing it in due course. However, if we do not have it as part of our deliberations, our scrutiny in this House is false scrutiny because it is not based on the full facts and realisation of what the full impact will be. My noble friend Lord Forsyth described it as a second-hand car with we know not what under the bonnet in terms of the engine. I think it is more dangerous than that; we are about to launch an aeroplane without knowing whether it has landing gear and, if it has, whether it will work when the plane lands. That is a very serious consideration. I hope that even at this late stage the Government, through my noble friend the Minister, will try to find some way of ensuring that we can, as part of our scrutiny, look at the implications of the fiscal framework.

My second point is about permanence. I remember that many years ago when I was a law student in Edinburgh I was told that the Act of Union, which contained the phrase “that Scotland and England would ever after be united into one kingdom by the name of Great Britain”, could never be changed. I seem to remember “perpetuity” being mentioned. Yet the very holding of the referendum last year showed how false a position that was because, had the result gone the other way, that perpetuity would have been destroyed. I rather think that the permanence we are looking at in terms of Clause 1 will suffer the same end, and I look forward to hearing the arguments in Committee about whether there is some other way to give satisfaction and confidence, which I understand from the Minister is what we are trying to achieve. I mention in passing that doing so might be helpful to give satisfaction and confidence to the other side of the argument, too. If we are to have a ratchet to say that we can never go back from where we are, we ought to have a ratchet to say, “Thus far and no further”. That might give many of us a lot of reassurance on devolution.

In answer to the noble Lord, Lord Reid, my reason for not having spoken on this for 17 years is that at the end of the process of taking the Scotland Bill through the other place, where I led for the Opposition, I described it as the beginning of the slippery slope to separation. I was answered with accusations of scaremongering; that this was never going to happen; that devolution would hold. I do not think that the phrase “Thus far and no further” was ever mentioned, but that was the impression I had. That was what we would give the Scots in terms of devolution and that would be that. We are now on the third Bill: the slippery slope is continuing and, if we are not very careful with this Bill, it will go on even further.

I stopped talking about devolution because I recognised that the line I had taken had been defeated and I had to live with that. I did not want to be part of the slippery slope argument. The only reason I come back to it now is that, when we held the referendum last year and I thought the staying together side would win it, I rather foolishly thought that might be the end of the slippery slope. However, it was not, because in the last few days the vow was given, in unnecessary panic, and the results of that are now before this House. I am absolutely convinced that this is going to give encouragement to the nationalists in Scotland to push further and further.

This brings me to another point about the fiscal framework. My noble friend Lord Forsyth mentioned, quite rightly, that he was suspicious about how keen the nationalists would be to see this completed in time for the parliamentary elections in Scotland. If I was them, I would not want to see it. If I am a nationalist I do not want stability when we get to those elections: I want instability. If I was a nationalist I would be saying, “Let us do everything we can to stop the framework being achieved”. The Government are in danger of falling into that trap unless we find another way out of it.

My view is very simplistic and has been from the start. The nationalists are the Danes. In the words of Kipling: when you start paying the Danegeld, you never get rid of the Dane. Over the years since devolution came along, we have always been paying the Danegeld; they always come back for more and will continue to do so. We have to think very seriously about that when considering the Bill. I end by saying something that I never thought I would say. Over these years, we have created great instability within the United Kingdom. I am a keen supporter of the United Kingdom—an arch unionist. I never thought I would be looking at anything to replace the United Kingdom that I was brought up with. However, I accept what I have heard from a number of noble Lords today, starting with the noble Lord, Lord Campbell of Pittenweem. The time has come when we have to look seriously at how we create another Act of Union. It might be by convention or by all sorts of different ways, but we cannot go on relying on an Act of Union that has been so destabilised. We need to find something and if that is federalism, which I have opposed all my life, so be it. I would prefer that to the alternative of a further slippery slope and eventual separation.

--- Later in debate ---

[Lord Davidson of Glen Clova (Lab)]

My Lords, I add, if I may, to the many congratulations to the noble Lord, Lord Campbell of Pittenweem, and the noble Baroness, Lady McIntosh of Pickering. It is a joy to see two members of faculty joining this august body. The welcome from the noble Lord, Lord Stephen, was perhaps less warm, identifying as he did the difference between members of the Faculty of Advocates and the solicitor branch. However, I assure noble Lords that the ratio of nine members of the faculty to one Scottish solicitor does not always happen in debate.

As ever when one is dealing with legislation to do with Scottish devolution, there has been a lively, lengthy and informed debate. As ever, many questions have arisen to which the answers from Her Majesty’s Government are eagerly awaited. Some of these issues, as the noble Marquess, Lord Lothian, observed, are not entirely novel, so perhaps the answers have already been prepared.

One wonders whether the progenitors of the Scotland Act 1998 ever foresaw that their work would require to be revisited quite so often and quite so extensively. Be that as it may, the Scotland Bill, implementing as it does the recommendations of the Smith commission, is a remarkable piece of legislation. I join the noble Baroness, Lady Goldie, in saying that the noble Lord, Lord Smith of Kelvin, deserves considerable gratitude from both the UK and Scottish Parliaments for the work he has carried out in bringing about this remarkable piece of work. Reflecting as it does the work of five political parties represented in the Scottish Parliament, as well as the very many other contributors, the Smith commission makes for a substantial constitutional contribution.

As my noble friend Lord McAvoy has pointed out, this side of the House has obtained a number of amendments by concession from the Government to bring the Bill into line with the Smith commission recommendations.

I will try to cover some of the many significant points that noble Lords have raised today. I start, if I may, with Clause 1—always a good place to start in a Bill—and the question of permanency of the Scottish Parliament and Scottish Government. The noble and learned Lord, Lord Wallace of Tankerness, drew this very swiftly into the area of federalism, as Liberal Democrats sometimes do. I was not sure whether he saw the permanency provision as one that was a bar to federalism or one that maybe encouraged a referendum on federalism to take place in due course. Be that as it may, he identified an important question for the Minister to answer: the question of whether the legislative consent Motion has two categories and how these are to be dealt with.

The noble Lord, Lord Lang of Monkton, raised fundamental issues in looking at this clause, going to the very root of the sovereignty of Parliament. These are very deep waters. Perhaps this may not be the right time at which to examine these points, but they certainly make the constitutional position of the UK, which is sometimes lost sight of, very much an issue to be looked at in the context of this Bill.

As the noble Marquess, Lord Lothian, observed just a few moments ago, it does rather seem as though permanence is not for ever. Be that again as it may, the noble and learned Lord, Lord Mackay of Clashfern, echoed that the issue of sovereignty is an important point. That was picked up on by, I believe, his noble devil, the noble and learned Lord, Lord Hope of Craighead. He further developed the concern that this question might result in these issues having to be determined in a court, and that might make matters even livelier than people perhaps have considered thus far.

My noble friend Lord Foulkes of Cumnock, who styled himself as, I think, a disappointed devolutionist, thought that clarity might be helpful to some degree. I am possibly helping the Minister here in saying that permanent Scottish government does not actually mean permanent SNP Scottish government. However, the point that has become rather more concerning in Scotland and was identified by the noble Lord, Lord Steel of Aikwood, is the question of a one-party state. This is a warning; it is not actually a representation of the reality at the moment. However, these issues should not be ignored. They reflect real concerns in some quarters in Scotland.

The noble Earl, Lord Stair, raised the question of the committee structure in the Scottish Parliament and identified that the tendency for domination by one particular party is of real concern. My noble friend Lord Maxton reminds us that devolution is a democratic process, and I trust that his words will be carried northwards. The noble Lord, Lord Norton of Louth, questioned the constitutional and intellectual coherence, and I think many people can understand his point. However, it is perhaps a high bar in UK constitutional matters to require intellectual coherence at every stage. One has only to occasionally consider the debates about the reform of the House of Lords, where one or two oddities have presented themselves—not least the constitution of those of us who are participant.

The question raised as to whether the broader UK context might lead us into some issue was developed by my noble friend Lord Brennan. He requires an answer as to how one is going to build confidence in Scotland, as well as in the rest of the UK, in these procedures. That is quite an important part of how this process should develop, because its impact is not restricted inevitably to Scotland; it is part of the whole unitary state that is the UK.

I turn to an issue raised briefly in relation to welfare. The noble and learned Lord, Lord Wallace of Tankerness, raised the question of delivery and responsibility in this area—an entirely sensible approach. I take that as support for the proposition that we should establish a Joint Committee on welfare devolution. The noble Baroness, Lady Liddell of Coatdyke, took this point very much to heart in her intervention, demonstrating the question of the competence of the Scottish Government. She identified this as an issue relating to health, and therefore welfare. Indeed, she took it further to look at, correctly, the issues of education, policing in Scotland and so on, a point echoed by the noble Earl, Lord Kinnoull. I suspect that my noble friend Lord Foulkes is not entirely satisfied with the Scottish Parliament in this regard. Since he participated in it from time to time, he is a substantial witness in relation to how the Scottish Parliament may proceed in its competence. The noble and learned Lord, Lord Hope of Craighead, continued to develop these concerns in relation to how the participants—the Members of the Scottish Parliament—were in a position to fully seize and deal with the new responsibilities that would be coming their way. That question was picked up by a fellow member of the Faculty of Advocates, my noble and learned friend Lord McCluskey. He added the question about SNP competence, but as I understood it he was keen to welcome their presence here as well—presumably on the basis that those who came here would be more competent.

The noble Lord, Lord Sanderson of Bowden, had an interesting suggestion that the Select Committee structure might usefully be brought to the attention of the Scottish Parliament. That echoes the notion that the current committee structure is perhaps not providing the level of scrutiny that one would desire.

The critical issue that has been repeated by many noble Lords is the fiscal framework. This is, of course, the focus of important matters. It has been looked at by both the Economic Affairs Committee and the Constitution Committee. I respectfully suggest that it is clear to anyone that a Bill of the highest constitutional importance deserves wide and full consideration. This House—the very existence of which is justified on its being a revising Chamber—has an especially important position in such constitutional debate. The coherence of the UK as a unitary state is not an irrelevant consideration in that debate.

My noble friend Lord Hollick set out a number of issues where there are real concerns. It is important that we see what the answers to these questions are. Maybe we will have to wait until January next year, but it would be helpful if we had some indication of where the discussion between Her Majesty’s Government and the Scottish Government has been going.

The noble Lord, Lord Kerr of Kinlochard, raised his “three unknowns”, which raise very clear issues—fairness, borrowing powers and future transparency. These are mightily significant issues, on which this House really requires some kind of instruction if it is properly to scrutinise the Bill.

The noble Lord, Lord Griffiths, with his well-known economic expertise, raised the question of Scottish living standards and the way that they may be affected in ways that are not minor. These issues also have to be considered.

The noble Lord, Lord Turnbull, raised the complex question of indexing. Again, this is not something that can be dealt with in a few minutes of discussion. These are complicated issues and some insight into them is, I respectfully suggest, what this House deserves.

The noble Lord, Lord Lang of Monkton, also raised the question of scrutiny and the terms of a memorandum of understanding. Again, some hint might be useful as to where this is going, because these involve deep issues that may be with us for many years. The noble Lord, Lord Kirkwood, is correct that it is important that the Bill be passed before the Scottish election, but it is important that we have some understanding of where we will be, whether it is in January or shortly thereafter.

When he looks at these kinds of issues, the Minister might wish to share with the House, for example, whether an analysis has been offered by the Scottish Government—a considered analysis, one trusts—of the two committees: the Economic Affairs Committee and the Constitution Committee. They have raised important issues; have the Scottish Government discussed them with Her Majesty’s Government? It would be interesting to know whether they see force in these points. Where do they stand on these issues?

[Lord Reid of Cardowan]

I confess that I am neither an advocate nor even a solicitor, which probably excuses my inability to grasp the answer to what is a simple question. The question at the centre of all we have been discussing is the consideration of the Bill, in this House and the House of Commons, without the fiscal framework. That is what has run through every debate. Given that the Scottish Parliament will not consider the generality of the Bill without the fiscal framework and that in July, the Government expressed that it was perfectly feasible to discuss the Bill while externally discussing the framework, why is it not possible to agree, during these discussions with the Scottish Parliament, that we will complete the final stages in parallel with it? That would not be unfair to anyone. It would mean that, since the Scottish Parliament will not consider the final details of the Bill without the framework, we would simultaneously be considering it and the Bill, and doing so in a spirit of concord and agreement. Perhaps as an advocate, as well as a noble and learned Lord, my noble and learned friend will explain why that process would be impossible.

--- Later in debate ---

[Lord Reid of Cardowan]

Before the Minister leaves this subject, let us get to the heart of the matter. The thread that has been running through tonight’s discussions has not been about the coherence or otherwise of each individual element of the fiscal framework. It has been the question of whether this Parliament can possibly proceed with the Bill without knowing the fiscal framework that is the crucial, central element that determines all its other aspects, particularly in view of the fact that the Scottish Parliament has, very sensibly, under the leadership of the SNP, taken the view that it cannot and will not ratify the terms of the Bill without first knowing the fiscal framework. That is the question—not any individual, tactical item of the framework, but whether we are flying blind. Will the Minister therefore address the question that I put to my noble and learned friend on the Front Bench, which he generously offered to share with the Minister: why is it that, if we can envisage simultaneous negotiations outside Parliament with proceedings inside Parliament, we cannot envisage simultaneous conduct and conclusion of the Bill, including the financial framework, on terms that the Scottish Parliament itself thinks are reasonable? Would he respond to that? I hope he will say that he will inject this into the cordial and constructive negotiations that are going on, but if he is not prepared to do that, will he tell us why not? Is this just a matter of parliamentary timetabling, or is there some matter of principle that the Scottish Parliament should be encouraged and permitted to make a decision in the full light of all the facts while the British Parliament should be asked to make a decision with half the facts missing?

[Lord Dunlop]

The noble Lord anticipated what I was going to talk about. He is always very prescient about these matters. I want to explain why the Government believe that the Bill can proceed without delay and without compromising the detailed scrutiny of the fiscal framework, which Parliament rightly expects to carry out. First, there are the practicalities around delivering the promises that we made. People in Scotland made a decisive choice to remain part of the United Kingdom. They voted for a more powerful Scottish Parliament with the strength that comes from our union of nations. To achieve this, voters in Scotland will expect to go to the polls next May knowing what powers the Scottish Parliament and the Scottish Government will have, so they can cast their votes knowing how the parties will use those powers.

It is important to get the Scotland Bill to Royal Assent before the Scottish Parliament elections next year. A number of noble Lords have made that point in this debate. That is for a very good reason. It is not just a political priority for the Government. I believe—this has been confirmed in the debate today—it is a priority shared by the Labour Party and the Liberal Democrats, too. If we seek to delay the Bill now, it will be very difficult to meet that timetable, which is one that Scottish voters expect and one that the UK Parliament has adhered to every step of the way so far.

Northern Ireland Assembly

Lord Reid of Cardowan Excerpts

Thursday 10th September 2015 Lords Chamber

Asked by

[Lord Reid of Cardowan]

To ask Her Majesty’s Government what is their response to the demand of the First Minister of the Northern Ireland Assembly for an immediate adjournment or suspension of the Northern Ireland Assembly within 24 hours.

[Lord Reid of Cardowan (Lab)]

My Lords, I beg leave to ask a Question of which I have given private notice.

[The Parliamentary Under-Secretary of State, Scotland Office (Lord Dunlop) (Con)]

My Lords, the question of an adjournment of the Northern Ireland Assembly is a matter for the Northern Ireland Assembly. I understand that the Assembly Business Committee is meeting this afternoon to consider this proposal.

[Lord Reid of Cardowan]

I thank the Minister for that Answer, which of course did not refer to suspension of the Assembly, which is not within the remit of the Northern Ireland Business Committee but within the powers of the British Government. Only two days ago, the Government said that they had no intention to suspend the Assembly. Yesterday, in what is effectively an ultimatum, the First Minister of Northern Ireland said that unless the Assembly was adjourned by the Northern Ireland Business Committee, which is meeting today, or suspended by the British Government, he and the DUP members of the Executive would resign, effectively bringing down power-sharing in Northern Ireland.

I understand the difficulties the Government have, since one of the options does not take place until 2 o’clock this afternoon, and they will not know the outcome of whether there is to be an adjournment within the power of the Northern Ireland Business Committee until that stage. I do not wish to add to the Minister’s difficulties, and I understand that the Government will not wish to say anything prematurely. However, this is a very grave issue indeed.

I will ask the Minister two simple questions. The first refers to the Government themselves. Will they assure us that, at the earliest possible moment after the Northern Ireland Business Committee has met this afternoon, they will bring this issue back to the British Parliament? Secondly, as regards the talks being convened by the Northern Ireland Secretary, which may be under way at present, will the Government give us an assurance that these will be time-limited? If they are not, I can assure him from experience that they will drift on indefinitely, and this crisis will just get worse.

[Lord Dunlop]

The noble Lord brings vast experience of Northern Ireland to these matters. Indeed, when he was Secretary of State for Northern Ireland, he went through a period of suspension, and he will appreciate the seriousness of any step to suspend. As the Secretary of State for Northern Ireland has already set out, the Government do not think that the time is right to suspend devolved institutions. If circumstances change, the Government will review their options. Clearly, this is a fast-moving situation, and I am sure that the Government would want to keep Parliament informed, and will certainly do so. We had exchanges on this yesterday, and I very much agree that any talks need to be focused, intensive and urgent and, therefore, time limited.

Northern Ireland: Political Situation

Lord Reid of Cardowan Excerpts

Tuesday 8th September 2015 Lords Chamber

[Lord Dunlop]

I very much agree with the noble Baroness that the Police Service of Northern Ireland needs the support of the community in pursuing these investigations. If people have information that will help the police with their inquiry, we would certainly encourage them to come forward.

[Lord Reid of Cardowan (Lab)]

My Lords, there is very little in this Statement that anyone here would disagree with and I thank the Minister for it. However, I think the reason there would be very little disagreement is that there is actually very little that is new in it. As my noble friend Lady Blood pointed out, these events have been going on for some time now. There is, however, one significant new element, which is the expressed intent of the Government to, as they put it, as a last resort be prepared to legislate here at Westminster. For those of us with a sense of déjà vu—I declare an interest, as I was involved, I think, as Secretary of State in three suspensions—this is a profound statement wrapped up in rather quiet words. Can the Minister therefore confirm to us that what this actually means is a suspension of the legislative powers in that area at Stormont, or is there another way of legislating here on a subject which is, after all, devolved?

The second question relates to the predication of that intention not on the political differences per se and particularly not, as the Statement makes clear, on the murder of Mr McGuigan, but on the real prospect that the Executive will start running out of money, not least in the public services and no doubt starting with health. In view of that link between the Government’s intention, presumably, to suspend Stormont—or at least to take legislative powers here from Stormont—and the running-out of money, the Government must have carried out some estimate of how imminent that is. Given that Parliament will rise next week, this is an important question. I notice that the Minister said that the situation is already difficult, but is he in a position to be a little more specific and tell us whether we are talking about a period of a week, a fortnight, a month or two months? As I have said, these innocent-seeming words have a profound implication for those of us who have lived through such a situation before if it results in the suspension of power-sharing at Stormont.

[Lord Dunlop]

I thank the noble Lord for his question. The first thing that I need to make clear is what I said earlier: that the Government do not think that suspension of the devolved institutions is right in the current circumstances. The noble Lord is absolutely right to say that the budgetary situation is acute. That is why these talks will be intensive, urgent and focused, and will last between three and four weeks.

On welfare reform, as I said earlier, if all other options have been exhausted and given the acuteness of the budgetary situation, the Government would be prepared as a last resort and extremely reluctantly to legislate here in Westminster on welfare reform.

Smith Commission: Implementation

Lord Reid of Cardowan Excerpts

Monday 8th June 2015 Lords Chamber

[Lord Dunlop]

My Lords, it is not a characterisation I would agree with that the electorate of Scotland repudiated the Smith agreement. Every one of the manifestos of all the main parties, including the SNP, included a commitment to take forward the Smith agreement. Of course, there will be discussions, and I know that there are many views within this House about how best to do that, but the main objective—the Government’s main commitment and priority—is to take forward the commitment we made to implement the Smith agreement.

[Lord Reid of Cardowan (Lab)]

My Lords, the Minister will recall that, having agreed the Smith commission proposals, the SNP then wanted to go much further: for full fiscal autonomy on the basis of its rather spurious estimate for the future of the Scottish economy. That was based on oil at $113 a barrel. This morning, oil was around $60 a barrel, opening up a £7 billion or £8 billion black hole in projected Scottish public expenditure. Has he received any recent demands from the SNP for full fiscal autonomy?

[Lord Dunlop]

My Lords, I am not sure exactly where the SNP stands now on full fiscal autonomy. Its position seems to change by the day but I am absolutely clear, and the Government are clear, that full fiscal autonomy would be bad for Scotland. By the end of this Parliament, it would leave a £10 billion funding gap that would have to be addressed by higher taxes or larger spending cuts in Scotland. The noble Lord is absolutely right that one of the benefits of being part of the UK is that which comes from pooling and sharing resources, so that public expenditure remains relatively stable when revenue flows such as oil and gas are so volatile.