Wales: Commission on Devolution in Wales

Lord Wigley Excerpts

Monday 18th November 2013 Lords Chamber

[Baroness Randerson]

I thank my noble friend for his support on this issue and for underlining the importance of this Statement. I am proud of the record of the coalition Government: we have already, through our facilitating the referendum on increased full legislative powers for the Welsh Assembly, enabled one step forward on devolution to be taken. Today’s announcement heralds a second giant step forward for devolution. While expressing full confidence in the model of devolution throughout the United Kingdom, however, the Government have been concerned that we should not in any way undermine the union. It is important to bear that in mind.

My noble friend referred to the need to strengthen institutional arrangements. I cannot give him an estimate of the cost, because that strengthening is largely a matter for the Welsh Government. It is essential that they go ahead with this rapidly. I am aware that they are already in the process of strengthening their financial arrangements for establishing a Treasury function within the Welsh Government.

[Lord Wigley (PC)]

The Minister understands that I support the thrust of the Silk report and the response of the Government, but can I press her on the way in which she is blindly following Scotland in insisting on the introduction of a lock-step rule whereby all three rates of income tax can only be varied in tandem, without the right to vary one rate independently of the other? In other words, if the Welsh Government wanted to bring down the top rate from 45 pence to 40 pence—an 11% reduction—there would have to be a 25% reduction in the standard rate of income tax, making such a choice totally impossible. Does she understand that the Holtham and Silk reports rejected such a lock-step approach? This not only denies the voters the choice of policy, but also flexibility to the Welsh Government and binds them into a straitjacket of relativities imposed on them by Westminster. Why do a Government who claim to support greater tax-varying flexibility in theory refuse to deliver it in practice?

[Baroness Randerson]

I am disappointed that the noble Lord, who has given a great deal of thought to this matter, has not been able to welcome the vast majority of the Government’s response. I take issue with the idea that we are blindly following Scotland. There is no blindness about this. The Treasury has made its decision on this, based on the evidence that it took in relation to the specific situation in Wales. I have already referred to the significance of the very porous border between England and Wales, and to the fact that so many people live close to and cross it on a daily basis. That was borne in mind by the commissioners at the Silk commission when they produced their report, and the Government have had to take that into account as well.