Wales Bill
Lord Wigley Excerpts(10 years, 2 months ago)
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Lord Anderson of Swansea (Lab)
My Lords, it is my pleasure to move my Amendment 7, which is that all matters regarding the electoral arrangements are subject to agreement by the National Assembly. The key phrase is,
“subject to agreement … before implementation”.
I am not personally against the following amendment, which will shortly be spoken to by my noble friend Lord Wigley, but I submit to him that my amendment is more likely to be acceptable than his, although I think that we are working to the same end.
Essentially, my proposition is clear and simple. It is as clear, pure and simple as the last amendment, moved by the noble Lord, Lord Rowe-Beddoe. In my judgment it is absurd that we should be laying down the rules relating to the electoral arrangements irrespective of the views of the National Assembly. Its Members are the experts in the field. They have the experience of fighting elections for the Assembly in Wales and the decision should be left to them. Even local authorities have a degree of discretion, which is currently denied to the Assembly. Without this, the arrangements are in the spirit of high to low—“We in Westminster and Whitehall know best”, almost as if in colonial times, when the constitutional arrangements were handed down like tablets of stone to the grateful people. Surely we are dealing with a mature and maturing democracy in Wales, where the representatives of the people should decide for themselves. However, if leaving it by Order in Council wholly within the responsibility of the Assembly is not acceptable, the next best thing—perhaps the more realistic alternative—is the one proposed in this amendment. Do we really think that we know best? Have we no trust in the Assembly? I leave this question to the Minister: can it be reasonable that we do not involve the Assembly, not as a matter of generosity but as a matter of law, in decisions on its own electoral arrangements?
Lord Wigley (PC)
My Lords, I support the spirit in which the noble Lord, Lord Anderson, has moved his amendment and am very supportive of its thrust. Amendment 8 in my name and that of my noble friend Lord Elis-Thomas transfers all responsibility for Welsh general elections to the Welsh Assembly. The provisions in it and Amendment 10 would mean that the Welsh Government could determine the electoral system used for elections to the National Assembly, as well as having control over the administration of those elections. It would certainly be my hope that, if the Welsh Assembly was granted such powers, it would vote to move towards a more proportional method of electing representatives. Plaid Cymru’s policy has long been for a form of proportional representation. I say that looking at Benches opposite and hope that they would concur warmly with that.
Any decisions relating to the electoral system would of course be up to the National Assembly for Wales to make. It would surely be a common-sense move to allow the Assembly to be in charge of its own elections, just as this Parliament is in charge of its own elections. It would once again strengthen the accountability of the institution and I hope that the Government will see the merits of this amendment.
The Parliamentary Under-Secretary of State, Wales Office (Baroness Randerson)
My Lords, I thank the noble Lords, Lord Anderson, Lord Wigley and Lord Elis-Thomas, for tabling these amendments. I begin by discussing Amendment 7, which provides that the electoral provisions in the Bill should not be implemented until the Assembly has agreed them. Let us look at the electoral provisions in the Bill. The majority of the electoral proposals are widely supported within the Assembly. As I said earlier, the initial move to a five-year fixed term for the Assembly, set out in the Fixed-term Parliaments Act 2011, came about as a result of a vote in the Assembly. In the Government’s subsequent consultation on a permanent move to five-year fixed terms, there was also unanimous support from the parties in the Assembly for such a move.
The consultation also showed widespread support in the Assembly for the move to ban MPs from also sitting as Assembly Members, although the Welsh Government did not believe that there was currently a need for legislation on this. The Government consulted on these changes. We listened to the views of those who responded and included these provisions in a draft Bill, which was subject to extensive scrutiny by the House of Commons Welsh Affairs Committee. Therefore, the Assembly has had the opportunity to express its views even though I freely accept that it falls short of the legal obligation that the noble Lords are seeking.
Amendments 8 and 10 would require the Secretary of State to publish draft orders within six months of the passing of the Bill, for the approval of both Houses of Parliament, to provide for the transfer of responsibility for elections to the National Assembly for Wales. It is worth noting that the Silk commission did not make recommendations in relation to Assembly elections in its part 2 report. I also note that wholesale transfer of responsibility for elections has not been devolved under any of the devolution settlements. Therefore, at this moment the Bill is probably not the appropriate vehicle for making such a transfer on a piecemeal basis for only one part of the UK, at a time when a wholesale look is being taken at the whole shape of devolution. If there were not work going on in the Cabinet committee at this time, it would be a more appealing argument. Having said that, I go back to the point I made right at the beginning of my responses: this is a response to the provisions of the Silk 1 report in large part and the Green Paper.
Lord Wigley
The noble Baroness refers to this being a piecemeal approach, which is apparently not appropriate. Would she therefore use the same principle that, when there are devolution proposals for Scotland, they would not be regarded as piecemeal but rolled out for Wales and Northern Ireland also?
Baroness Randerson
They are being looked at in the context of Wales and Northern Ireland, yes. Piecemeal means something different from having solutions that suit the individual countries. Piecemeal is when you pick one thing off at a time without looking at the situation in the round. There are some areas where I would fully agree that the situation is very different from one country to another, and it is appropriate that we respond in different ways. There are other things, such as the conduct of elections, where one needs to look in the round at all three countries and see whether one can have a comprehensive approach—the kind of comprehensive look that my noble friend Lord Thomas referred to earlier—to devolution.
The Bill provides for a referendum to be held on the devolution of a portion of income tax, among other things, and ensures that the decision of when and whether to hold this referendum is in the hands of the Assembly. It is important to point out that issues such as referendums obviously have an impact across the UK and need to be properly considered by not only the Assembly but Peers and MPs. In devolved areas there is already provision in Section 64 of the Government of Wales Act 2006 for Welsh Ministers to hold a poll in all or part of Wales to determine how any of their functions should be exercised.
I hope that the work of the Cabinet committee on devolution will result in a less piecemeal approach to devolution in the UK, and I point out to noble Lords that the Secretary of State is working across the parties in Wales to achieve consensus on a more robust settlement for Wales.
The amendments, if accepted, would represent a fundamental change to the devolution settlement in Wales. It is therefore important that they are considered in the context of party manifestos for the 2015 general election, and I therefore ask noble Lords not to press their amendments.
Lord German (LD)
My Lords, I hope that this amendment will be quite straightforward. I hope to make the case that this Bill is the right Bill at the right time for dealing with this matter, as I will explain.
The amendment is straightforward because it seeks to put the names of the candidates back on the regional ballot paper. This situation existed for all National Assembly elections until the last one. I want to go back to the days when I remember the ballot paper saying—noble Lords who were around at the time will remember it, too—Welsh Labour Party: number 1, Rhodri Morgan; number 2, Sue Essex; number 3, Jane Hutt. That seemed to send quite a clear message to send to people who wanted to vote Labour. If they put their mark alongside, they were voting for those people in that order. This would also return us to what goes on in European elections, where the names of the candidates for whom you are voting appear on the ballot paper.
To understand why this amendment is the right amendment at the right time, now, we must try to find out why the names were removed in 2011. I have before me the reply to a letter that I wrote to the Electoral Commission prior to the 2011 National Assembly for Wales elections, and which I received before those elections took place. It outlines the reason why it recommended the names be taken off.
It states:
“After the Assembly elections in 2007, our published election report identified that a number of complaints had been raised by voters about the size of the regional list ballot paper. Voters found it difficult to complete in polling booths and to fold and put into ballot boxes. The ballot paper size was also problematic for printing and counting”.
The commission’s recommendation to resolve this issue was to reduce the number of candidates eligible to stand on the regional list. The letter stated that each party was still able to nominate up to 12 candidates, even though since 2007 candidates had been prohibited from standing for both the regional list and the constituency election.
As we all know, four candidates are elected in each region. The Electoral Commission stated:
“In our view, it would be sufficient that each party could nominate up to six candidates for the regional list. Three of the main political parties in Wales supported our recommendation to reduce the number of candidates nominated, but the other main party did not. The change would also require”—
this is the crucial part—
“amendment to the Government of Wales Act 2006, for which there was no apparent legislative opportunity at the time”.
I do not know whether it was my party that did not say yes to reducing the number to six. Certainly, nobody asked me about this issue at the time. However, the important consequence was that, as it did not have the time to change the primary legislation and did not have the agreement of the parties, the Electoral Commission decided to follow the alternative route of simply taking off the names of people standing on the regional list for each party.
As many Members of your Lordships’ House will know, on the regional list ballot paper there are not just parties but independent candidates, so part of the reason for the growth of the ballot paper was not just the number of names against parties but the independent candidates—usually only one name. The restriction on ballot papers by the Electoral Commission and by regulations on the size of the fonts and of the ballot papers passed by your Lordships’ House made it impossible for any other change to take place because the Electoral Commission had run out of time.
The letter also states:
“We shall assess the outcome of the change in our statutory report on the election, based on feedback we receive from parties and returning officers”.
There was feedback post the election. I have described the situation that led the Electoral Commission to recommend that change. In its report on what happened afterwards it stated:
“Early on polling day”—
it is almost like the story of the man with the bricks and the ladder—
“there were complaints that regional candidates’ names were not displayed or were displayed inadequately by some Returning Officers”.
There was a rule that you had to put them up somewhere in the polling station. As noble Lords know, many polling stations are in schools, where children’s work is often on the walls and the space where you can put up a list of names may not be apparent. It was certainly not alongside the polling booth or in the polling booth itself but could be anywhere. I went to a polling station where the list was on a steel box. They could not put drawing pins in it, so they had to use tape. The only tape they could find obliterated half the words. They put the list on the outside wall of the property, so people went in and it was then too late to see the names. The Electoral Commission goes on:
“There were also a small number of complaints from postal voters that they did not have access to the names of regional list candidates other than by consulting notices in public places or local authority websites”.
So people who voted by post had no knowledge of the names of the candidates and people in polling stations had no idea where to find the names. You had to be pretty good at hunting around in the polling station to find the names.
The Electoral Commission states:
“We conclude that, following the experience at the elections, the question of whether candidates’ names are included on the regional list ballot paper should be reconsidered. However, before certain relevant matters are resolved … it would be premature to make decisions on the regional ballot paper. We will revisit this issue no later than December 2014”.
That is two months from now.
I ask noble Lords to consider whether that needs to be done slightly faster. The commission gave its report after the 2011 elections and we have waited a further three years for an answer to this question. Because there was no legislative time available last time, it meant that that change could not be made to reduce the number.
The obvious answer is to reduce the number of names on the ballot paper to six, which was the Electoral Commission’s recommendation. I am not actually wedded to six, but it seems a reasonable number, because there are only four places available. Even if a party won all four places, there would still be two left in case the first two fell under a bus halfway through the election period. It is unlikely that, during an election campaign, four candidates would die and no people would be left to fill up the names on the list. We have to make that change according to the number of spaces that there would be on a ballot paper, to make it less unwieldy. That is the only argument that I have heard, as explained by the Electoral Commission, for making the change and removing the names.
It is a fundamental right of people, when they place their mark on a ballot paper, to know the names of the people for whom they are voting. These are the people who will represent them on an equal status. The noble Lord, Lord Elis-Thomas, has said to us on many occasions that those who are elected by the regional list system are of equal status to those who are elected from the constituency. Therefore, it is important that people should know the names of those for whom they are voting and the order in which they are elected.
It is not our favourite system; in our party, we would not want to say that. But we are approaching the time when the chance to make this change is fast running out. If there is to be a change to primary legislation and, following that change to primary legislation, secondary legislation has to come to provide the appropriate rules for the election in 2016, it would require a piece of primary legislation to be placed before Parliament in the first four months of a new Government. I know that many noble Lords will think that for this very purpose that is not a very likely procedure. This Bill is the right one in which to make that simple change to the line that appeared in the Government of Wales Act 1998 as well as the 2006 Act:
“The list must not include more than twelve persons (but may include only one)”.
Lord Wigley
I am following the noble Lord’s argument with a lot of interest and considerable sympathy, but would he and his party not go one stage further by having an open list and allowing electors to determine the order in which people fill those slots?
Lord German
I would indeed. As I say, this is such an urgent matter to change and to change the electoral system to make that happen might be a step too far. I might be told, in exactly the same way as the noble Lord has been told many times this afternoon, that this is not the right time or place or Bill. But because there is only one chance to do this, this Bill is the right place and it is the right time. I hope that my noble friend and the rest of the Government will see the wisdom of this action and give people the right to see who they are voting for on their ballot paper.
Lord Thomas of Gresford
My Lords, I support the noble Lord, Lord Elystan-Morgan, on this. Clearly the sons of Denbighshire had it right in that the forgotten ironmaster, possibly Wilkinson, was responsible for “Senedd”. Certainly, I used the phrase and Lord Hooson used the phrase. It is the appropriate title for a Welsh Assembly/Parliament—but I prefer to call it the Senedd.
Lord Wigley
My Lords, many of us campaigned for a Parliament for Wales for many years and in that context, obviously, the ambitions for a legislative body that has full competence, including tax raising and tax varying, fits with the concept of a Parliament.
The one point that I would make—and undoubtedly the noble Lord, Lord Elystan-Morgan, has thought about it—is that the building in Cardiff is now known as a Senedd, which makes it even more complex, with the differential between the Senedd building and the Cynulliad Cenedlaethol or National Assembly that is within it. We are of course aware that in France the National Assembly is the primary body. Therefore, my feeling is that whereas I have total sympathy with what my noble friend is aiming at, perhaps this, like so many other issues, is one that in the first place the National Assembly itself and its Members should decide on.
Changes have been made, as has been referred to earlier today, with regard to moving from the First Secretary to the First Minister and from secretaries to Ministers; something that was picked up by custom and practice in the first place and then became accepted. I hope that if there is to be a move in this direction it is by the initiative of the Members of the National Assembly itself. What is most important—I am sure that the noble Lord would agree—is the powers and functions that that body has to serve the people of Wales.
Baroness Randerson
My Lords, I thank the noble Lord, Lord Elystan-Morgan, for his amendment, which seeks to change the name of the National Assembly for Wales to the Welsh Parliament. Clause 4 of the Bill does amend the statutory title of the Welsh Assembly Government to Welsh Government. Since law-making powers were devolved to the Assembly in 2011, the Government have almost universally been referred to simply as the Welsh Government. Our clause reflects that reality. The same is not the case for the National Assembly for Wales, which is still commonly known as the National Assembly, the Welsh Assembly or the Assembly.
My view is that, once the Assembly has the powers of a Parliament, it should be called one. At the moment that is not the case. It is, however, worth pointing out that there are several national legislatures called assemblies. There is the Assemblée Nationale in France, the Quebec Assembly and the South African Assembly. So there is a swap-over in the use of the words.
Honourable Members will be aware that the Silk commission recommended that if the Assembly wishes to change its name to the Welsh Parliament, this should be respected. The noble Lord’s amendment goes further than Silk by simply changing the name of the Assembly in primary legislation—crucially, as the noble Lord, Lord Wigley, has said, without the Assembly itself what it feels about the issue. I think it is essential that such a change should not take place without consulting the Assembly. I therefore urge the noble Lord to withdraw his amendment.
Wales Bill
Lord Wigley Excerpts(10 years, 2 months ago)
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Lord Wigley (PC)
My Lords, I can readily identify with the comments of the noble Baroness, Lady Morgan of Ely. I agree that these matters should ideally be in the hands of the National Assembly to decide. None the less, we have guidelines that have been laid down from here. By virtue of speaking to Amendment 5, I want to draw attention to the fact that there are real dangers when a Westminster election overshadows an election to the National Assembly.
Amendment 5 provides that the poll for a National Assembly ordinary general election should not be held within 355 days of the date of a UK general election, although I accept entirely that it should be a matter for the Assembly finally to decide on these matters if we can give it the power to do so. The amendment mentions 355 days rather than 12 months to allow situations to arise whereby one vote could be held on 7 May one year, followed by a poll on 1 May the following year, or similar circumstances.
The truth, which may not be immediately apparent to colleagues from other parts of the United Kingdom, is that the UK media are heavily biased in favour of England-only issues. That is understandable because most of the media are based in south-east England and look through a prism from that perspective. In the leaders’ debates in the run-up to the previous general election, for example, party leaders answered questions relating to healthcare and education, without mentioning that those policies were applicable only in England and not in Wales or Scotland. These considerations spill over to arguments in relation to the settlement that will be made to Scotland as well.
Circumstances such as these are highly confusing for viewers, listeners or readers in Wales and can lead to voters making choices based on policies that would not in fact affect them. Wales has a number of daily newspapers such as the Western Mail and Daily Post, as well as very good local newspapers, but the majority of people still get their news and election coverage from London-based outlets. Were an election to the Welsh Assembly to occur in quick succession following a UK general election, or in inverse circumstances, it is certain that any debates surrounding Welsh policies would be totally drowned by UK election coverage. The Electoral Reform Society Wales has said that combining polls would always have a detrimental impact by causing confusion for voters, and that Welsh elections would be “subsumed” into media coverage of the UK general election.
To ensure that voters’ decisions are well informed, we believe that provisions similar to those contained in Amendment 5 would be necessary to mitigate such media distortion, although I repeat that I would prefer that initiatives along those lines should come from the Assembly itself.
Lord Richard (Lab)
My Lords, I agree with the thrust of the amendment but I am bound to say that I am not sure that I fully understand the wording of the first part of it. If one actually looks at the text, it would seem that the amendment proposes that the Welsh Assembly should revert to a system in which the First Minister of the Welsh Assembly, with the consent of the Assembly, would be able to determine to hold an election at any moment that he thinks fit. In other words, we would be back to the situation that we were in before we passed the Act a few years ago that set up the five-year Parliament gap.
If the intention of the amendment is that the Assembly should be able to fix in advance a particular term at the end of which an election should be held—in other words, that the Assembly should decide whether it should be a five-year, four-year or even perhaps a three-year term—that I understand and fully appreciate. If the intention is, however, to give the Welsh Assembly the additional powers that the Prime Minister had in the old House of Commons, to call an election at the time of his own choosing, I am bound to say that I am not sure I agree. I accept the thrust of the amendment, which is that decisions on the timing of an election should be a matter for the Assembly, but I am not sure whether the wording of proposed new subsection (1) in the proposed amendment goes anywhere near achieving that.
Lord Rowlands (Lab)
My Lords, I understand and appreciate the power of the argument that the noble Lord, Lord Wigley, has just proposed to make sure that elections are not simultaneous. However, there is a case against that. The most worrying aspect in the whole of my parliamentary lifetime is the decline in turnout. In a democracy, turnout is extremely important. In the last Assembly election, the turnout was just over 40%. In the last general election to Westminster, it was 65%. The high point was in 1950 when we had a UK turnout of more than 83%. It never fell below 70% at the United Kingdom level until 2001, when it fell to 59%. But even now, at 65%, it is some 20 percentage points higher than the turnout for the latest Assembly election. I wonder whether we ought to be concerned about that. Although I understand and appreciate completely the argument that UK issues drown out Welsh issues, there is a point to make about turnout. It is extremely important in a democracy that turnout is upheld.
The turnout when I served Merthyr for 30-odd years was 70% to 75%. It fell to 70% in the last election in which I stood and I was mortified. But at the last election it fell to 59%, and that is in a highly political kind of community that appreciates and understands the nature of politics and elections. A case could be made, contrary to the one made by the noble Lord, Lord Wigley, that if you run the elections together you intensify the politics. Parties are more engaged in the streets and you raise the turnout from 40% to 65%.
I am dredging my memory but the last time elections were run concurrently was in, I think, 1979, when local elections and the general election were held on the same date. That raised the turnout in local elections to a dramatically higher level than ever before. Although I understand that there is consensus at the Assembly level on separating the elections, I wanted to register the point about turnout.
Lord Wigley
Would the noble Lord, Lord Rowlands, accept that one element of an election is to give a mandate to the Government? If the mandate has been generated on the basis of a different election, how on earth can it be interpreted in the context of the Assembly?
Wales Bill
Lord Wigley Excerpts(10 years, 2 months ago)
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Lord Wigley
“Report on reserved powers
The Secretary of State shall lay a report before each House of Parliament which shall lay out a timetable for the transfer of the National Assembly for Wales to a reserved powers model of governance within six months of the passing of this Act.”
Lord Wigley (PC)
My Lords, I am pleased to have the opportunity to move Amendment 1, standing in my name and that of my noble friend Lord Elis-Thomas, who will be speaking a little later. He brings a valuable insight into matters relating to the National Assembly’s competence, having served with distinction as its first Presiding Officer for 12 years.
It is particularly appropriate that this should be the first legislation with which we deal in our first day after the Summer Recess, coming as it does within a month of the Scottish referendum. Scotland and Wales are, of course, two different countries, and we are, as nations, at different stages in the process of securing greater independence. The debate about, and the outcome of, Scotland’s referendum does not of necessity impact on the Bill, but in reality it cannot but do so.
As the Prime Minister, David Cameron, acknowledged within hours of the outcome being known, there will be a need for constitutional change in order to deliver the commitments made to Scotland by all three UK parties, and that, in such a process, the needs of Wales and Northern Ireland, and indeed those of England, will be taken fully on board. Mr Cameron said that it will be vital to achieve,
“a balanced settlement, fair to people in Scotland and importantly to everyone in England, Wales and Northern Ireland as well”.
A tight timetable for bringing forward such proposals and acting upon them has been promised to Scotland and has been repeated today. No doubt the Government will be eager to keep their pledges. I trust that they will be equally committed to delivering for Wales in a timely fashion.
We in Wales are fortunate in that regard, as we have not only this Bill before us today, which provides a vehicle for legislative change, but also the benefit of the two reports of the Silk commission that have been published. The commission was of course set up by the present Government with all-party representation and came to unanimous conclusions. The Government do not have to go away and start from scratch. They have the work of their own commission readily at hand. It would be strange, indeed perplexing, to the people of Wales if the Government did not move forward with alacrity on that basis.
My first amendment, which I am now moving, goes to the very heart of the issue regarding the National Assembly and to the weaknesses of the devolution provided by the 1998 Act. The proposals for Wales were fundamentally different to those provided for Scotland. Scotland’s 1998 Act provided a reserved powers model of government. In contrast, the powers of the National Assembly for Wales were prescriptive. That has led to a lack of clarity and to the unfortunate spectacle of legal wrangles in the courts as to whether the Welsh Government acted within their powers. My noble friend Lord Elis-Thomas will no doubt have much more to say about those issues.
The Silk commission, in its wisdom, recognised the significance of this problem and recommended that Wales should also have a reserved powers model of devolved government. It said that,
“a reserved powers model for Wales … would bring greater consistency and coherence across the United Kingdom … After careful assessment of the evidence we formed the firm view that a reserved powers model would be superior to the current arrangements, and that it would better satisfy our principles of clarity, coherence, collaboration, accountability, subsidiarity, stability, effectiveness and efficiency”.
I am very pleased to see that Amendment 18A, in the name of the noble Baroness, Lady Morgan, has been grouped with these amendments. I am delighted that our minds are working along similar tracks. As I understand it, all four parties in Wales are fully signed up to supporting such a change. So what we propose here is in no way controversial. I suggest that it is something that noble Lords from all Benches in this House would be proud to support.
I can almost hear the words forming themselves in the mind of the Minister—the noble Baroness, Lady Randerson. She might eagerly agree with me that such a move would have the Government’s unqualified support but might say that now may not be the right time or that this Bill is not the appropriate vehicle. I will address those considerations. The most pressing reason for us to legislate on this matter in this Parliament is to ensure that in May 2016, when the next Assembly elections take place, they will be held in circumstances where all parties and electors know that Wales’s Government, after May 2016, will be working within a reserved powers system. The beginning of a new Assembly is the appropriate time to do that and the parties, in drawing up their manifestos for that election, can do so happy in the knowledge that they will not become enmeshed in the sort of legal challenges that sadly we have seen under the present basis of devolved power.
Some might argue that including these provisions in this Bill does not give Parliament adequate opportunity to consider the detail of the legislative changes proposed. I would answer that in two ways. First, we are not venturing into uncharted waters. For both Scotland and Northern Ireland, the reserved powers model exists. All we need to know is the detail of what will be reserved. The Silk commission has done invaluable work in this area.
Secondly, we might recall that the time that elapsed between the Wales Bill of 1998 receiving its Second Reading and the completion of Lords amendments was just seven months. This amendment is immensely generous in its time provision, giving the Secretary of State up to six months to bring forward his report for a firm timetable, which would aim at having the matter concluded and the necessary legislation enacted to be operational by the Assembly elections of May 2016.
There is a third argument: as there is all-party consensus in the matter, it should not warrant the odium that some might feel in the other Chamber that the initiative has come from here. If we build into the Bill the appropriate legislative hook by passing the paving amendment of the type I have proposed, MPs in the other place can use that to put forward their own proposals to provide a reserved powers model. If we do not pass an amendment in this place, the other place will be technically unable to return to the matter. In other words, we are providing for them the platform they need to consider and—I hope—achieve such a change.
My colleagues and I fully realise that this amendment goes beyond the provisions of the Long Title. That is why we have tabled Amendment 63 to the Long Title to enable us to consider in the Bill such matters as have been raised by the second Silk report. There is nothing unusual in amending a Long Title to broaden the scope of the Bill. Indeed, the Government have tabled Amendment 62 to do likewise for another purpose.
I move briefly to Amendment 2A, which is grouped with this amendment and was tabled in case Amendment 1 is rejected for any reason. Amendment 2A lists in detail the legislative subjects that we in Plaid Cymru believe should now be transferred to the competence of the National Assembly. They include matters such as police and prison services, broadcasting, natural resources and energy, and transport, which the second Silk report recommended should be devolved to the Assembly. It also goes further than Silk in proposing that matters such as criminal justice and the Welsh constitution should be devolved immediately.
We put forward these proposals in the spirit of the proposals for substantial new devolved powers being given to Scotland’s Parliament and in the spirit of the Prime Minister’s pledge that Wales should not be left behind. As the First Minister for Wales intimated, if devo-max is appropriate for Scotland it should also be appropriate for Wales, even if some of the detail of necessity will vary.
There is a remarkable degree of cross-party unity in the National Assembly on this matter. Given the way that Scotland has been urged to work on the basis of cross-party consensus, I very much hope that this will not be rejected when it is happily seen to be arising in the context of Wales. However, having gone to the lengths of laying out in detail the type of matters we feel should be devolved—and the list is neither exclusive nor exhaustive—I readily concede that we would much prefer to have the issue addressed by moving along the lines of Amendment 1 on the basis of reserved powers.
Devolution has been seen rightly as a process, not an event. Today’s Bill gives a most timely opportunity for that process to move forward. My party, Plaid Cymru, aspires to see very much greater independence of political action being in the hands of the Welsh people. However, we accept that in the context of this Bill we are able to move towards a home rule Parliament, with some matters still being reserved for Westminster. We put these amendments forward in a positive and constructive manner to improve the government of Wales. I hope that we shall have a positive response from all parts of the Chamber. I beg to move.
Lord Wigley
My Lords, I thank all noble Lords who have taken part in this debate: my noble friend Lord Elis-Thomas, the noble Lords, Lord Crickhowell, Lord Thomas of Gresford, Lord Elystan-Morgan and Lord Rowlands, the noble Baroness, Lady Morgan, and a number of Peers who intervened. I thank the noble Baroness, Lady Randerson for her response. I am somewhat disappointed at the tone of the Minister’s response, particularly given the virtual unanimity in relation to Amendment 1. I welcome the noble Lord, Lord Bourne, to his Front-Bench responsibilities. There is some irony: I look at the Front Bench where there are two Members who were in the Assembly in 1999. I look at this Bench and at the Back Bench opposite. It seems that the Assembly is slowly taking over here. Some of us want to see the process happening in the other direction.
The consensus that was reached by the Silk commission on this matter and the consensus of this House with regard to the reserved powers are ones that need to bring out of the Government a firmer commitment that we have had today. I appreciate that work is going on on these matters, but that is not enough. I accept the comments that have been made in relation to Amendment 2A. Of course that goes further. I understand that it would not carry a consensus and that may be a reason for not going forward on that basis. But I remind the House that the powers in Amendment 2A are ones that have been committed now with regard to Scotland and have been committed with alacrity. We may very shortly hear more about that in this Chamber. If there is an imperative that drives those forward with great speed in Scotland and if there is a total commitment by the Prime Minister to make sure that Wales does not fall behind, how on earth can they be rejected out of hand? I accept that they will not be taken into the Bill, but I very much hope that between now and the new year there will be some indication of further legislation to meet those points. Otherwise, the commitments that have been made do not have the value of the print in which they have been expressed.
The Prime Minister’s pledge that Wales will not miss out means that these issues must be considered, and quickly. But even if the Government cannot accept the matters covered in Amendment 2A, and if they are not prepared to go down the route of Amendment 3, which was addressed by my colleague, we should certainly have a commitment that specific proposals will be brought forward in this Parliament and that further legislation can be concluded quickly after the general election of May 2015 to be in force from May 2016, when the new Assembly comes into being.
Lord Purvis of Tweed
I just have a point of clarification. I listened very carefully to the noble Lord’s speech, and I agree with the Minister that there is some awareness. However, some elements of the powers within this clause were of course part of the Scottish Parliament, understandably because of the legal system, which was there beforehand. Some were devolved because of the Scotland Act 2012, and some aspects of these are being considered by the Smith commission, so it is perhaps not entirely the case that they all reside in the Scottish Parliament alone.
Lord Wigley
We have in the grouping of these amendments brought two different fields into play, and they need to be addressed separately to that extent. Of course matters related to the Home Office are already devolved to Scotland. We are very much aware of that, and that is one reason why matters such as policing, to which the noble Lord, Lord Elystan-Morgan, referred a moment ago, have wide support across the party-political divide in Wales and should be devolved rapidly.
Even though I accept what the noble Baroness said with regard to bringing in changes mid-Assembly, that may be appropriate with regard to some of the background systems and the concept of reserved powers without changing any of the actual detail of the portfolios being devolved. But if we are talking about further devolved portfolios of the sort that will come into play in Silk 2, they most certainly need to be specified before the 2016 election so that the issues within those portfolios can be addressed by the parties putting forward the manifestos for that election. I understand what the noble Baroness is saying in regard to the theory, but in regard to the practice we need to have that further detail.
I return to Amendment 1. I reject the suggestion made by the noble Baroness that this has been poorly thought out. It has been drafted on very good advice.
Baroness Randerson
I hope the noble Lord will accept that I was referring to Amendments 2A and 3.
Lord Wigley
I am very grateful that the noble Baroness is taking the opportunity to clarify that, because that will be helpful for Members in all parts of the House. It is quite clear that we have a cross-party consensus, as the noble and right reverend Lord, Lord Harries, mentioned a moment ago. It will be very helpful if we could have some indication between now and Report as to how exactly this is going to be taken forward.
Although there is a mention of “within six months” in the amendment as a period for bringing forward proposals on reserved powers, that does not mean that we need to take the whole six months. I believe that the process can be completed within four months, before Prorogation for a general election. It will be very useful if this has been clarified at that stage, even if some of the detailed legislation has to be taken forward thereafter.
I also reject the suggestion—it is always made at this stage of a Bill, as we are coming nearer Royal Assent—that if we send it back with changes to another place that will open a can of worms. I do not believe it will because I think the same cross-party consensus exists in another place as exists here. If there is that general agreement with regard to the reserved power model, let us just get on with it, not hold back.
Baroness Randerson
The noble Lord might reflect that while there might be consensus within Wales on this issue among political parties, there are a very large number of English MPs in the other place who will quite rightly want to discuss this in the context of their own situation. I fear that we could find the process very heavy going if we started to expand this Bill beyond its original intention.
Lord Wigley
My Lords, heaven help us if English MPs are going to start voting on matters of purely Welsh concern, but I take the point. I am sure the other point is understood across this Chamber as well.
The issue that I want to stress before withdrawing this amendment—obviously at this stage it is a probing amendment—is please, between now and Report, can we firm up the intentions in general with regard to reserved powers? I reserve the right to come back at Report if that is not done. I hope we can achieve that without that being necessary and that the consensus in this Chamber today will be carried through and can work for the benefit of Wales. I beg leave to withdraw the amendment.
Wales Bill
Lord Wigley Excerpts(10 years, 5 months ago)
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Lord Wigley (PC)
My Lords, this is the third Wales Bill since the 1997 referendum. The second Silk report will no doubt require a fourth Bill and developments in Scotland, as we have just heard, may well trigger even further legislation. Indeed, I feel that the issues in the Bill are ones that I have lived with for most of my life. I was involved in the legislative processes in another place on the ill-fated Wales Bill 1977-78, as were a number of colleagues here today, on which the noble and learned Lord, Lord Morris of Aberavon, and my noble friend Lord Elystan-Morgan worked so very hard. Indeed, I was involved in the Wales Bill 1998, which became the basis of the National Assembly in the present settlement. Back in 1970, I also gave evidence to the Crowther commission, as it then was, which became the basis of the Kilbrandon report of 1973. I gave further evidence, as an elected Member of the National Assembly, to the Richard commission of 2003. That, of course, led to the 2006 Act, which will be amended by the Bill and was the basis of the 2011 referendum and the advanced settlement that we got subsequently. The issues and I go back a long way, and I have the scars to show for it.
I first want to thank, as an individual and on behalf of my party, Plaid Cymru, Paul Silk and his fellow commissioners for their hard work. I pay particular tribute not only to my colleague, Dr Eurfyl ap Gwilym, the Plaid Cymru representative on the Silk commission, but to the noble Lord, Lord Bourne, who, as the Conservative voice both on the commission and previously in the National Assembly, managed to bring his party to play a positive role in the new post-devolution Welsh politics.
The Silk commission’s efforts in coming to grips with an immensely complex subject—particularly in its first report, which is the basis for the Bill—deserve to be rewarded by the way we enact consequential legislation. Indeed, I believe that our starting point today should be to accept that the Silk commission worked very hard to reach a consensus involving much give and take, and that, as such, it presented a balanced report that should be accepted and taken forward as a package and not cherry-picked. I say that because all political parties had to compromise on their party programmes and a united, unanimous report was secured only on that basis. Naturally, my party, Plaid Cymru, would have liked to have gone very much further. We aspire to the maximum possible degree of independence for Wales within a framework of a united Europe with its free movement of people, goods and capital, which inevitably imposes some constraints on the degree of independence that any country has.
Unlike the Calman commission in Scotland, our Silk commission succeeded in getting all-party acceptance that there would have to be some compromise so as to get implemented at an early stage those changes that all parties saw as necessary in order to make the Assembly a more effective body and the Government of Wales more transparent and democratically answerable for their actions. That is why, even at this late stage in the Bill’s parliamentary journey, I urge that we look at whether we can implement the entirety of the Silk package. In that regard, I noted the point made by the noble Baroness, Lady Randerson.
Since the publication of the Bill, the Silk commission has brought forward its second report on the legislative powers to strengthen Wales, and in some ways it is difficult to differentiate between the two. Indeed, some have suggested that the reports are in the wrong order. An old saying that I found very apposite in the world of industry as much as in the world of government is that “form follows function”. The function of the National Assembly is dependent on the model of devolution—it would be somewhat different if Wales had a reserve-powers model such as that of Scotland and Northern Ireland—and inevitably that impacts on the transparency and accountability of the Assembly. The range of devolved portfolios will dictate the size of the budget, and the nature of those portfolios and the extent to which they lend themselves to policy variation in Wales compared with England will dictate the degree of budget flexibility that is needed. In addition, the degree of responsibility deemed appropriate for a Welsh Executive in largely non-legislative matters, such as economic stimulus management, will determine the balance between capital and revenue responsibilities.
I have deliberately tried to set my remarks in the context that I have for the very reason that we must formulate the financial powers needed to strengthen Wales with regard to the responsibilities of providing adequate enabling resources and ensuring proper answerability. In order to deliver the legislative, executive and administrative agenda that the Welsh Government will have as their responsibility, they need to be clear about the powers that they have. That of course is the agenda that the Welsh people expect to be arranged for their needs and expectations to be answered.
I believe that we shall have to make certain assumptions with regard to those non-financial matters as a basis on which we can reach meaningful conclusions regarding finance and the adequacy of the Bill. For example, the linkage between the budget and expenditure, and hence the resources needed, and the democratic need for the Government’s performance to be judged by the electorate requires both financial transparency and resource flexibility. I shall give a concrete example. If the NHS in England were privatised, as some politicians on the right advocate, and if the Welsh Government, having full legislative responsibility for the NHS in Wales, wanted to follow a different path, they would have to have a significantly different financial and fiscal freedom from the one they have at present for that to be a meaningful policy option.
I turn to some specific aspects of the Bill that will no doubt warrant our attention in Committee. In Part 1, I certainly welcome the removal of the restriction on dual candidacy and a return to the original settlement of the 1998 Act. It was, quite frankly, a piece of naked party-political jiggery-pokery by the Labour Government to have removed it, and they should be ashamed of themselves for having tinkered with the constitution for party-political advantage. I hope that we can have an assurance from the Labour Front Bench that never again will they resort to such unworthy action. If that assurance is not forthcoming, we should build into this Act a provision that any further change to the electoral system of the Assembly should be implemented at Westminster, if indeed it has to be done at Westminster, only if it carries a two-thirds endorsement by Assembly Members.
With regard to the Assembly’s election and membership, I am totally convinced that the Assembly cannot do an effective job with its new, enhanced powers since the 2011 referendum without a larger membership. That becomes an even greater requirement with the additional financial scrutiny that will emanate from the Bill. I believe that there need to be at least 100 Members to do an adequate job. Might I suggest that if we are not to have an STV model of election, which I favour, we should consider each of the current 40 Assembly constituencies having two Members for each seat, with one man and one woman elected in each, thereby largely overcoming the question of gender balance that has been a problem for some parties over the last few years? Primarily I believe that this is something that the Assembly itself might consider as any such initiative should come from Wales and not be imposed by Westminster. I hope that the Government might be amenable to giving the Assembly full powers over the electoral system.
I am, incidentally, aware that in the Commons Report stage, Labour proposed taking steps towards a reserve powers model, to which the noble Baroness, Lady Morgan, referred earlier, and I heartily endorse that. But inexplicably, it linked this to a delay in implementing Part 2 taxation powers, which I could not understand. I hope that when this matter comes to Committee we shall be able to consider the pressing need for Wales to have a Parliament based on the same reserve powers as underpins the Scottish Parliament and the Northern Ireland Assembly, without unnecessarily linking it to delaying the taxation powers.
With regard to the taxation powers in Part 2 of the Bill, they are very modest indeed—so much so that I personally had some doubt about whether they warranted a referendum. However, I accept that that was part of the Silk recommendation. In the spirit of accepting Silk as a package, and not cherry picking, I accept that that referendum may be necessary. But, for every small change in relation to the government of Wales, we cannot have referendum after referendum. The House of Commons is elected and this Chamber is appointed to do a job of work, and we have to take that responsibility. In that spirit I urge the Government to reconsider their rejection of the Silk proposal on tax rates being varied in each band, to which reference has already been made and signals given that we are moving in the right direction.
The Government’s insistence on having a straitjacket of lock-step provision in the Bill undermines, at a stroke, the flexibility of the Welsh Government to use the new tax-varying powers in a radical fashion. They could not, for example, reduce the top rate by 5p, say, to make Wales a more entrepreneurial-friendly place, at a modest cost in terms of forgone income without reducing the standard rate proportionately—a totally impossible and unsustainable action. The irony, as I have no doubt the government Front Bench are very much aware, is that in Scotland, where the Calman commission insisted, I believe, in having a lock-step model, the Government in their move towards a devo-max situation as part of buying off the yes vote in the Scottish referendum are now talking about scrapping the lock-step, as recommended by the Strathclyde commission, and indeed personally endorsed by the Prime Minister. I am grateful to the Minister for indicating that the Government will indeed look again at this, and there may be a possibility of doing something about it in Committee or on Report.
I welcome the provisions of new Section 116C to be inserted in the Wales Act, allowing new devolved taxes. Some work needs to be done in the Assembly to see how that can best be used. I shall now say a word about the workings of the borrowing powers, which appear in Clauses 20 and 21 of the Bill. I understand that until a further referendum is held the Assembly’s borrowing powers will be capped at £500 million, which frankly is chickenfeed, and totally inadequate to deal with Wales’s economic problems. This is insufficient even to fund the M4 improvements around Newport, which will cost more than £900 million.
Will the remainder of that capital have to be funded from the already truncated capital budget of the National Assembly, leaving virtually nothing for any other capital projects—hospitals, schools, roads, sea defences—needed around the rest of Wales? It seems, quite frankly, as if the Welsh Government’s hands are being tied by Westminster in order to deliver London’s objectives and priorities, not the balanced capital programme needed by Wales. The Assembly should have an accumulated borrowing capacity of £2 billion over and above the M4 costs and we should address that question in Committee.
I have dealt with what is included in the Bill but I cannot let it pass without noting what is not included. In its introduction, on page 3, the Silk report comments that:
“Consideration of the Holtham Commission’s proposals for funding reform in Wales … was excluded from our terms of reference. These issues are being taken forward through a separate bilateral process between the UK and Welsh Governments”.
That is the elephant which cannot speak its name in today’s debate but whose shadow makes a sham of pretending that this Bill deals with the central financial question facing the Welsh Government—that is, the persistent, chronic underfunding as a result of the mindless, myopic adherence to an outdated and discredited Barnett formula, which has left Wales, since 1999, with a cumulative shortfall of £6 billion in its finances. This has led to the underfunding of the NHS, schools and local government in Wales, and neither party of government has had the courage to put that right.
In recommendation 12, Silk stated that if the UK Government were to agree to devolve corporation tax to both Scotland and Northern Ireland, the same powers should be given to Wales. Will the Minister confirm that if corporation tax is indeed devolved to Scotland, it will also be devolved to Wales? If so, why is there no order-making mechanism within the Bill to avoid having to get yet further primary legislation to handle the matter?
The real inadequacy of the Bill will become glaringly obvious after Scotland’s independence referendum in September. If Scotland votes yes—as I and my party hope—the relationships of the residual United Kingdom will have to be fundamentally reassessed. Even if Scotland votes no, partly as a result of the blandishments offered by the parties in Scotland to head off a potential yes vote, those commitments will need to be incorporated into the election manifestos of the UK parties, otherwise we could well see a bitter backlash in Scotland, with perhaps 20 or 30 SNP MPs holding the balance in the new Parliament.
That has a significant implication for Wales and for the adequacy of this Bill. The Bill we are debating today may well be seen, by the time we get to Committee, as a vehicle that must grow into an enabling Act relevant to the post-referendum world we shall then inhabit. It is in that context that I support a Second Reading.
Lord Roberts of Llandudno (LD)
My Lords, it is quite thrilling to hear the unanimity of those who have spoken, and our support for the Bill. We should show our appreciation of those who went before us and who fought on these issues, such as the noble Lord, Lord Prys-Davies, and the late Lord Richard Livsey, who were here for the last major debate on Welsh government. Perhaps we can send Gwilym Prys-Davies—he is still alive, you know—our regards at this time. There are others one cannot name.
I was going to spend a long time arguing that we should increase the number of Assembly Members from 60 to 80. I do not need to do that; the case has already been made. What we have to do now—and here I shall come into conflict with one of my colleagues—is to decide how we are going to reach that figure of 80. In Scotland, of course, we have the single transferable vote for local government. I have fought for this all my life. I do not know whether I would win the argument in this House, but certainly I might try it. At the moment, we have 40 constituencies, each electing one Member by first past the post. The remaining 20 are in five regions and, in order to get some proportionality, we have the sharing of the vote there, which seems to work quite fairly—as fairly as anything we could devise at present. One suggestion was that there should be two-Member constituencies. Let me give one or two examples.
The noble Lord, Lord Rowlands, of course, represented Merthyr Tydfil, which used to be a two-Member constituency. The Tories never stood a chance there. It was always Liberal, and elected Keir Hardie. It never gave the minor party any chance at all. It had gone, of course, by 1929. The only one I can cite at the moment is Blackburn. In 1929 Blackburn was a two-Member constituency. Both socialists were elected and they polled 37,000 and 35,000 votes, but the Liberal and the Conservative polled 35,000 and 34,500 votes. It was winner takes all. To have that sort of arrangement would not be democratic or representative at all. We get it in local government sometimes. We get two-member wards and three-member wards and it is usually the same party that takes all the seats. I do not think that that is going to be acceptable to this House or to the people of Wales.
Lord Wigley
When I spoke earlier noble Lords may recall that I, too, had a preference for STV as a system, but I put forward the idea of two Members to each constituency—in the context not of an 80-Member Assembly but of a larger Assembly where there would still be a list, a presence that would bring proportionality or at least something approaching it.
Lord Roberts of Llandudno
I very much look forward to having the debate when we come to that amendment in Committee. I am sure that noble Lords see the argument that simply having two-member wards or two-Member constituencies would deny us fair representation.
We come then to the question which has been debated here, which says that a candidate cannot stand for a constituency seat as well as for a list seat. Delighted I am—that is a good Welsh way of saying it—that we are going to make it legal for a Member to stand for a regional seat, a list seat, as well as for a constituency seat. I do not quite agree with what the noble Lord, Lord Rowlands, said, that we simply do that so that those who are defeated at one level are successful at another level. Candidates are generally chosen for their profile and how they are able to contribute to the work of the Assembly if elected. What is wrong with trying to enable your most outstanding candidates to be elected on a first past the post system or a regional list system? We want the best people in the Assembly, and that is made easier by this recognition of dual candidacy.
In Wales, most of us vote for five different authorities: Europe, Westminster, Cardiff, the unitary authority and our community council. Are we voting too often? I am not going to deny anybody, but could we not merge the votes for, say, the community council and Europe, so that we do not go to the polls five times when we could have just the same democratic influence by going less often? I would even approve of elected local health authorities. I do not suggest that they be elected on another day, but that they could be linked so that we can make the most of these election days.
I now turn to finance and how the funding of elections and of constituency campaigns needs to be looked at in Wales. On the membership of parties, I do not have figures for Wales alone, but only those for the United Kingdom. In 1990 the Conservative Party claimed a million members. In 2011 it had 130,000 members. Membership has crashed, and not only there. In 1990 Labour claimed 311,000 members and this year it claimed 193,000 members. The Liberal Democrats had 77,000 members and now we have 49,000 members.
Diminishing membership means that fewer people are able to have more influence than before. The mass membership has gone. I remember being invited to speak to a women’s afternoon meeting—it was not Liberal, it was Conservative—and 300 people were going to be there. We do not have that now. You would have had fundraising with Christmas fairs, whist drives and regular party branch meetings, which brought in the money. Who pays now for the expenses of our candidates at elections? Where does their party funding come from?
The coalition agreement has a statement in it which refers to,
“reforming party funding in order to remove big money from politics”.
We need a thorough review of party funds. I have here the names of the top donors for one quarter of 2014. I will not read those names but one contributed £1.5 million to the Conservative Party—in one quarter. Two others contributed £500,000 each to the Scottish National Party while the unions, of course, contributed very generously to the Labour Party. Now, he who pays the piper pipes the tune, so we should look at this. Especially in a Welsh Assembly, who pays and where is the influence?
The turnout in Welsh Assembly elections has never been 50%. In 1999 it was 46.4%, in 2003 38%, in 2007 43%, and in 2011 41%. The decreasing turnout over the past 50 years at all elections is a dangerous signal indeed because it means that with small branch and party memberships, and those people who are generous in their party contributions, an unhealthy influence is possible. I have presented a Voter Registration Bill, which I hope will be debated in the coming Session. In February 1974, 70% of 18 to 24 year-olds voted in the general election but, of the 5.6 million young people in the UK at present, only half are registered to vote and of that number only 24% are certain to vote. Why is that? It is because millions of citizens, especially young people, see politics as boring, out of touch, elitist, corrupt, complicated and unrepresentative. Such a small number of people are holding the reins of power now but it does not have to be that way. Our democracy can, and should, be something that everyone understands and has a stake in.
The Bill which I have presented is aimed especially at teenagers, encouraging them to register to vote and encouraging electoral registration staff to work with schools to ensure that every possible student is registered to vote. Northern Ireland already leads on this, where it is a schools initiative. As I will propose in the Bill, Wales needs this new way of registration to encourage all our young people, as well as everybody else who is eligible to vote, to cast their votes. The Welsh Assembly must belong to the people, not to a small number of them. It must be seen to be responsive to the people, not to small political parties or wealthy individuals. We have an awful lot to discuss on the coming Bill and I look forward very much to bringing these suggestions forward.
Lord Howarth of Newport (Lab)
My Lords, in a democracy, decisions ought to be taken at the level closest to the people whose lives they affect. The principle of subsidiarity is right, the moral and emotional case for devolution is powerful, and I support the Bill. But how to design a model of devolution in practice is far from straightforward. Politics is about reconciling and balancing different interests. How much devolution, and what kind of devolution, is in the interests of Wales and is in the interests of the United Kingdom? A wisely designed model of devolution—the holy grail—would strengthen both.
The first requirement is that the model of devolution should be clear, which is why I agree with many noble Lords who have spoken that it is now time for Wales to have devolution on the reserved powers model, not on the conferred powers model which leads to disputes in the courts and creates profound uncertainty. Silk was clear about this but the Bill, disappointingly, fails to address it. In this regard, Wales should be placed on the same footing as Scotland and Northern Ireland.
As my right honourable friend Peter Hain once remarked, devolution is not an event but a process, and the people of Wales have now made up their mind, after much initial hesitation, that they like devolution. They are glad that they have it and, as the noble Lord, Lord Elystan-Morgan, said, they have advanced up the curve of expectation and confidence. Wales is not Scotland, but if the people of Wales want no less devolution than is allowed to the people of Scotland, they should have it. But of course that raises the question: what do the Scots themselves want? And, as we consider these matters, what is in the interests of England, which is a thought all too commonly absent in debates on devolution? How can devolution strengthen the United Kingdom in the interests of all? Vague and open-ended promises of devo-max made by political leaders in the run-up to the Scottish referendum do not seem to be a responsible or satisfactory way to proceed. How is all this going to end?
Most of the wider constitutional issues that were considered in Silk Part II have been deferred to the other side of the Scottish referendum on 18 September. But perhaps after that, people will start to suggest that they ought to be deferred beyond a possible referendum on the United Kingdom’s membership of Europe. The noble Lord, Lord Wigley, stressed the importance to Wales of membership of the European Union. It is never the right moment to decide what the next stage of devolution should be but it is good that the Government are proceeding in the Bill. We should proceed where there is sufficient consensus both within Wales and across the political parties in the United Kingdom.
Although the constitutional issues have been largely deferred, there are provisions in the Bill on elections. The Bill would bring back dual candidacy: the right of a candidate to stand both in the constituency election under first past the post and on the regional list. As my noble friend Lord Rowlands has just recollected, the origin of these mixed elections was the recognition by the Labour Government in 1997 and 1998 that a Welsh Assembly elected solely by first past the post would, given the political patterns of Wales, be Labour-dominated for as far as the eye could see. It was Aneurin Bevan who remarked that “the purpose of getting power is to be able to give it away”, but that magnanimity is all too rare in politicians. It was found, however, in Ron Davies, the Secretary of State for Wales at that time, who believed that it was right to create a Welsh Assembly that would be in some sense ecumenical.
It is of course right that the parties should contest elections under both systems but I strongly believe that it is inappropriate that individual candidates should be able to run simultaneously under both systems. That being permissible, we got the absurd situation in the Clwyd West election in which all four first past the post candidates were elected. That can hardly have encouraged political engagement. Why bother to vote at all if everybody gets in? The noble Lord, Lord Bourne, observed that the people of Wales were not confused about this. No, I do not think that they were confused but simply that they were shocked, and the abuse got worse because those who had been elected on the regional list system then used publicly provided funds to set up constituency offices to establish a power base in the constituencies which they were targeting.
The noble Lord, Lord Wigley, said that the Labour Party’s objection to the restitution of this state of affairs is—and I wrote down what he said—naked party-political jiggery-pokery. I was going to refrain from mentioning in my remarks the scandal of Leanne Wood’s leaked memorandum to Plaid Cymru candidates in 2003 but, provoked by the noble Lord, I think it right to remind the House of it because not all noble Lords may be familiar with what she said in her missive to them. She said:
“We need to be thinking much more creatively as to how we … use staff budgets”—
those are budgets provided by the taxpayer—
“for furthering the aims of the party”.
She went on:
“Regional AMs are in a unique position. They are paid to work full-time in politics and have considerable budgets at their disposal. They need not be constrained by constituency casework and events, and can be more choosy about their engagements, only attending events which further the party’s cause. This can be achieved by following one simple golden rule: On receipt of every invitation, ask ‘How can my attendance at this event further the aims of Plaid Cymru?’ If the answer is ‘very little’ or ‘not at all’, then a pro forma letter of decline should be in order”.
This is a scandal that in the annals of political scandal should be in red letters and I hope that it makes even the noble Lord, Lord Wigley, blush. It is now a further scandal that the political parties which are the minority parties in Wales are using the majority that the coalition provides for them in Parliament at Westminster to take powers to resume these abuses. They are shameless about it and what they are doing will be seen for what it is. I agree with other noble Lords—my noble friend Lord Rowlands among them—that the Welsh Assembly and the people of Wales should decide their own electoral arrangements.
Lord Wigley
I noted the way in which the noble Lord nipped out quickly to get a copy, quoting from an earlier debate. The question I want to put is this. Would he apply the same change to Scotland now, given the political arithmetic there?
Baroness Randerson
I am specifically making it clear that the Government do not have a position on the reserved powers model. As the Silk report recommended, this is something for manifesto positions from the different parties. However, my party is in favour of the reserved powers model. That does not make it a government position, and it certainly is not something that can be created now. However much one might wish to do so, we cannot write the kind of complex legislation needed for a reserved powers model of devolution for Wales. If we tried to do so at that speed, we would be in danger of ending up with second-rate legislation, which the people of Wales do not deserve.
I move on to the point made by the noble Lord, Lord Wigley, on corporation tax. I remind the House that the Silk commission said that if corporation tax were devolved to Scotland and Northern Ireland it should also be devolved to Wales. There are no current plans to devolve to Scotland and Northern Ireland. However, the Bill contains the power to devolve further taxes to Wales by order. I would like noble Lords to note that. The noble Lord, Lord Anderson, raised the same issue about the power to devolve further taxes. A good example would be the aggregates levy once the EU Commission has completed its investigations. That provision is in the Bill as it stands.
The noble Lord, Lord Howarth of Newport, and others, raised the issue of borrowing powers and why they are not higher. I should point out that there are two capital borrowing limits: the annual limit and the overall limit. The overall limit in Scotland is £2.2 billion, which is supported by around £5 billion of annual devolved tax revenue. Using the same ratio, the overall limit in Wales would have been only £100 million. I ask noble Lords to bear that in mind when they ask for Wales to be treated like Scotland. We accepted that £100 million was inadequate so we increased it to £500 million specifically to enable M4 improvements to be undertaken, although there are no restrictions in law on how that could be spent. Obviously this is a power in perpetuity which the Welsh Government could exert for other things.
Lord Wigley
I asked a specific question on that. If the cost of the M4 relief road around Newport is £930 million, or so, and the limit on the borrowing, prior to having a referendum that would enable more to be levered in, is £500 million, does the balance—the £438 million, or whatever the figure is—have to come out of the capital budget of the National Assembly, and does that mean that all the other projects that are being funded by that are lost?
Baroness Randerson
How the Welsh Government raise the additional money is, of course, entirely at their discretion. It could come directly from their capital budget or they could have a partnership with the private sector to ensure that additional funding is available for them.
Wales: Economy
Lord Wigley Excerpts(10 years, 8 months ago)
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Lord Wigley (PC)
My Lords, I thank the noble Baroness, Lady Morgan of Ely, for facilitating this debate. I share many of her concerns, particularly those regarding European Union uncertainty. However, I admit that I do not recognise other aspects of the Wales that she describes.
The economy of Wales is still, sadly, the poor relation of the UK. Back in the 1960s Wales had a GDP standing at 92% of the UK average. The GVA per head, today’s measure, has Wales down at 72.3% of the UK—the lowest of any nation or region in the UK. London has a GVA of more than £37,000 per year, Wales under £16,000 per year. This decline is a devastating indictment of the failure of public policy over that period.
Before any noble Lord rushes in to castigate our National Assembly and the Welsh Government, I will point out that much of this decline occurred before 1999 and most of the economic tools are in the hands of the UK Government. Under successive Governments this decline has sadly continued. Incidentally, many of us in Wales are indeed getting sick to the back teeth of some Tory politicians, and the right-wing London media in particular, constantly talking Wales down. The truth is that the polarisation between the haves and have-nots among the UK nations and regions has worsened over recent years. The most recent years for 2012 show the GVA of south-east England increasing by 2.5% and that of Wales, as has been mentioned, by only 1.6%. So the gap is still widening.
The main factor in the GDP or GVA disparity a generation ago was the low activity rates in Wales. Wales was then some 6% behind the UK average. This has changed over recent years and that is to be welcomed. Wales now has an employment rate of 71%, closing in on the UK’s level of 72.3%, yet, sadly, the youth unemployment figures, if one looks at the past three years, not just the past year, have risen five-fold in Wales. That is not acceptable.
In Wales, the inactivity rate has decreased to 23.7%—again, something to be welcomed—lower than the north-east, the north-west and the East Midlands of England and of Northern Ireland, yet still our GVA figures are low. The explanation is the poor quality of so many of the new jobs in Wales. Too many are at the rock bottom of wage levels and many are part-time, zero-hour contracts. This is as much a problem in rural Wales as it is in the old industrial valleys. The two worst blackspots in terms of average wages being below living wage levels of £7.65 an hour are Dwyfor Meirion in north-west Wales, with 39.9% of its workers below a living wage level, and the Rhondda at 39.7% below a living wage level.
Lord Bourne of Aberystwyth
My Lords, against that background we have perhaps all been overcritical of politicians here, so does the noble Lord welcome the fact that the Secretary of State is hosting a job summit in west Wales, talking to local government and local employers to see what the Wales Office can do to help?
Lord Wigley
I welcome initiatives taken by anyone to improve the situation in Wales. To that extent, it is not a party political question; it is a crisis facing all the people of Wales, particularly those on low incomes.
In total, 23% of Welsh workers are below the living wage level. Surely all working people in Wales should receive a living wage. We need to generate jobs paying top-level salaries and wages, not just at the bottom, and public policy must be geared to achieve that. To my mind, one of the worst decisions in recent years was that of Rhodri Morgan to abolish the Welsh Development Agency. I very much regret that that was supported by all parties in the National Assembly, including my own, and including by the noble Lord, Lord Bourne. Even if the WDA cannot be re-established, the Government of Wales should look seriously at the proposal put forward last month by Plaid Cymru, and endorsed by the Federation of Small Businesses, to establish a private sector-led body to identify investment opportunities for EU funds. There is a real danger of EU strategic funds being squandered by successive Governments on projects that do not produce self-regenerative economic growth.
There is a pressing need for much higher capital investment projects, and in that context I include Wylfa—very much so—the M4 link road and the electrification in the south of Wales but also through to Holyhead. Given the Assembly’s limited borrowing powers at present, it is to be welcomed that there is a development in the legislation coming before Parliament but it will be years before it is fully developed if we have to wait for yet another referendum for it to be approved. It is ridiculous that the limited tax-varying powers in the Government of Wales Bill should need a referendum. Why can the Government not take such decisions without running for a plebiscite cover on the most trivial change? If the Government justify themselves on the basis that the Silk recommendations called for that, why ignore the Silk proposal to break free of the lockstep constraint on those tax changes? We also need a public sector development bank in Wales, as they have in Germany, to support small businesses that are neglected by the high street banks.
To secure economic recovery, Wales needs a business-friendly Government with a commitment to the specific needs of Wales, who are not driven either by a statist bureaucratic dead hand or by the perennial prerequisite of protecting the City of London at every turn. The domination of the UK economy by London has gone on for too long. For the sake of Wales, and indeed many regions of England, we need new thinking on that matter, and we need it urgently.
Wales: Silk Report
Lord Wigley Excerpts(10 years, 11 months ago)
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Lord Wigley (PC)
My Lords, I join noble Lords in mourning the loss of the late Wyn, Lord Roberts, of whom I had an earlier opportunity to speak in the Chamber. I very much thank the noble Lord, Lord Bourne, for facilitating this short debate and also pay tribute to his work on the Silk commission and that of other commissioners, including Plaid Cymru’s Dr Eurfyl ap Gwilym and, particularly, Paul Silk himself.
I am sure that the noble Lord, Lord Bourne, would agree that among the most remarkable aspects of the Silk commission was that, first, unlike Scotland, it was drawn up with terms of reference to which all four parties in Wales signed up and, secondly, its first report secured the support of all commission members. I am sure that the noble Lord would confirm that such agreement was achieved by some give and take and that the report was presented as a balanced package, not one to be cherry-picked. I regret very much that the Government, driven as they are by the Scottish agenda, could not accept the package in its entirety.
I regret that for two substantive reasons. First, by insisting on a lock-step on income tax, the Government denied the Assembly the significant degree of policy flexibility it might have otherwise enjoyed, and with it the possibility of creating a far-reaching investment programme that could stimulate the Welsh economy. Goodness knows that we need that. Business rate flexibility and stamp duty land tax are certainly worth having but are not in themselves enough. Secondly, by acting in this way, the UK Government have let the Welsh Prime Minister off the hook. Carwyn Jones has waxed eloquent this week on how the Tories and their Lib Dem backers squandered the opportunity provided by Silk. It has been enough of an excuse for Mr Jones to step away from a referendum, for what is the point of having a referendum on income tax powers that are unusable?
Had the Silk report been adopted in its entirety, with all the parties represented on the commission on board, it would have been impossible for Labour or any other party to wriggle out of having a referendum. A yes vote could have been secured again, as happened in the 2011 referendum when all four parties were united. I pay tribute to the noble Lord, Lord Bourne, in that context. That yes vote would have started making Wales’s Government truly answerable to the people of Wales in having to justify their expenditure and stewardship of Welsh taxpayers’ money. I cannot understand the Government taking this course of action which at one stroke negates everything they purport to advocate in terms of democratic answerability in Wales. Has Alex Salmond’s shadow really got them on the run to that extent?
I also respectfully disagree with the noble Lord, Lord Thomas of Gresford, and do not join him in talking Wales down in terms of the National Health Service. Goodness knows that there are people working hard enough and with great commitment in the health service in Wales, and they deserve our thanks. Of course, some bad decisions have been made by the Welsh Government, as by the Westminster Government. The noble Lord quoted a highly unfortunate situation in the NHS in Wales this week. One of the worst blind alleys that the Assembly pursued with regard to the health service was the creation of 22 local health boards, but I suspect that the noble Lord’s party supported it in doing that. The truth is that Barnett underfunding deprived the Assembly of some £5 billion since its establishment, and health and education in Wales have been underfunded as a result.
Lord Thomas of Gresford
I am sorry to take up the noble Lord’s time, but is that not the point? As soon as the NHS and education are under attack, what do they blame? It is the Barnett formula for failing to provide funds. We need accountability in this.
Lord Wigley
Of course we need accountability. That is why we do not need the lock-step, so that we get the tax linked in. I agree with the noble Lord on that. The fact is that if there was adequate funding, we would not have had some of the cutbacks that have been necessary in the health service in Wales.
The questions I wish to put to the Minister are these. First, could an income tax-sharing model be adopted before reform of the Barnett formula? Secondly, will the borrowing powers set out in the draft Bill include the old WDA borrowing powers, or is that a separate amount? Thirdly, is the M4 relief road dependent on getting these borrowing powers? Fourthly, how much of the £500 million borrowing limit will be available before a referendum? Fifthly, does the revenue stream from the minor taxes—the land tax and the aggregate levy—constitute enough to support the £500 million borrowing capacity? Lastly, the draft measure says that a yes vote in a referendum would allow the Secretary of State to raise the borrowing limit, but raise it by how much?
If I may put one key question to the Labour Front Bench, as Carwyn Jones has said that he will not hold a referendum until the Barnett formula has been replaced or radically amended, will the Labour Party give a copper-bottomed commitment that if it forms the next Government at Westminster after the 2015 election, it will reform or scrap Barnett as a matter of urgency?
The Parliamentary Under-Secretary of State, Wales Office (Baroness Randerson) (LD)
I thank all noble Lords who have participated in this debate. I start by joining the noble Lord, Lord Bourne, and others, in the tributes to Lord Roberts of Conwy. I had known him over many years, and he provided me with an inspirational example in the way that he fulfilled his role in the Wales Office. In particular, his love of the Welsh language ensured that changes were made at the time that have strengthened the language and its position in society.
I thank the noble Lord, Lord Bourne, for securing the debate today on the very important opportunities for Wales presented by the recommendations made by the Silk commission in its Part 1 report. I also paid tribute to the hard work of the Silk commission that went into the report, and I note the important role that the noble Lord played in that process. I have listened carefully to noble Lords in the Chamber and I am pleased that the Government’s response to the Silk commission’s recommendations has been broadly welcomed by several noble Lords, as has the draft Wales Bill, which, we must remember, implements the vast majority of its key recommendations, and which is currently undergoing pre-legislative scrutiny in the other place.
The Government believe that the devolution of tax and borrowing powers should be used to help to generate jobs and growth in the Welsh economy; to give Wales a competitive edge; and to make Wales a more prosperous place. Our response to the Silk commission and the powers we will transfer to Cardiff Bay, take forward these principles. The Welsh economy has lagged behind other parts of the UK for far too long—a point made by the noble Lord, Lord Anderson—and we intend to give the Welsh Government and the National Assembly for Wales the tools to change that.
Just as importantly, implementing the Silk commission’s recommendations will also make the devolved institutions in Wales more accountable to the people who elect them. We fully agree with the commission’s key recommendation: that the funding model of a block grant and some devolved taxes best meets sound principles for funding the Welsh Government, and that part of their budget should be funded from devolved taxation under their control. Since devolution, the Assembly and the Welsh Government have been accountable only for how they spend taxpayers’ money—a point made by the noble Baroness, Lady Humphreys. They will now become more accountable for how they raise it.
The Government demonstrated our commitment to these reforms by publishing the draft Wales Bill before the Christmas recess, only one month after we announced our response to the Silk 1 recommendations. We wanted pre-legislative scrutiny of this important legislation to take place in this Session of Parliament, and I am pleased to say that the Welsh Affairs Select Committee already has that scrutiny well under way. Subject to successful parliamentary passage of the legislation, I hope the new tax and borrowing powers to be devolved well before the next Assembly elections in May 2016.
I want an early referendum called as soon as possible after the legislation is passed, and I will be campaigning for a yes vote. I hope that the First Minister will be joining me.
In response to the points made about the ability to vary income tax in each band by the noble Lords, Lord Bourne and Lord Wigley, and the noble Baroness, Lady Humphreys, among others, we believe that the so-called lock-step system of income tax devolution that we have set out in the draft Wales Bill is the right system for Wales. The system applies in Scotland and was agreed with the Scottish Government, with a single devolved rate for all bands. We believe that it would work equally well in Wales. It delivers on two key principles that underpin the Government’s approach to devolving income tax. It ensures that the UK maintains a progressive tax system. As the noble Baroness, Lady Morgan, said just now, it prevents a damaging race to the bottom on higher-rate taxes, one where the tax rate increases as the income of an individual increases.
The income tax structure is a key mechanism to redistribute wealth across the whole of the UK, which is why we believe it is properly set at a UK level. That point was made clearly and firmly by the Calman commission in respect of its recommendations on Scotland. That point transcends both Scotland and Wales and applies to both countries. The lock step ensures that the gap between income tax rate is consistent across the UK; that devolved government works comfortably within the parameters of the UK; and that fiscal devolution does not benefit one part of the UK at the expense of another. This could occur if the Welsh Government were to set substantially lower rates for higher and additional taxpayers without having to change the basic rate.
Devolving income tax would give the Welsh Government a crucial lever that they could use to reduce taxes across the board in Wales to put money back into the pockets of people in Wales who are working hard and deserve to hold on to more of the money that they have earned. It will create new incentives for growth and jobs and rekindle the spirit of entrepreneurialism. If the people of Wales decide in a referendum in favour of income tax devolution, the Welsh Government would become responsible for almost half of the income tax generated in Wales, making it more accountable while giving them flexibility over levels of tax and spending. An important issue is, crucially, that devolution of income tax would give the Welsh Government access to a significantly larger revenue stream to finance borrowing. So it is far from being a power that cannot be used.
Even if the Welsh Government decided not to vary income tax rates, it would still provide a base for borrowing as well as a base for accountability. However, as the noble Lord, Lord Anderson, pointed out, you have to win the referendum first. I am surprised that the noble Lord can envisage only a situation where the Welsh Government would wish to increase tax if income tax were to be devolved. Under the Government’s proposal it would be just as feasible for the Welsh Government to reduce rates of income tax—for example, by half a pence or one pence in the pound. The noble Lord and the noble Baroness, Lady Morgan, both reflect the view, which is all too prevalent in the Labour Party, that taxes could only be altered by increasing them and not by decreasing them.
Lord Wigley
My Lords, the Minister has mentioned three times now the wish, which she clearly reflects, to reduce income tax and reduce the revenue the Assembly would have. What services is she going to cut to facilitate that?
Baroness Randerson
The noble Lord does not take account of the well known economic mechanism that reduced taxes create more money in people’s pockets, which stimulates the economy, which in turn causes more taxation to be collected. That is a basic point of economics that the Government are pressing.
Much time has been devoted to income tax, but we should not forget stamp duty land tax, which was referred to by the noble Lord, Lord Thomas, which will give us a chance to reshape the housing market in Wales in a way which is much more appropriate for Wales.
Further, we must not overlook business rates. The full devolution of business rates can be implemented almost immediately and without legislation, a crucial point which will enable the Welsh Government to get on with stimulating, for example, the establishment of new SMEs.
The noble Lord, Lord Bourne, asked about the future of the aggregates levy proposal. We have promised that we will review that once the situation in Europe is clear. On air passenger duty, we are not convinced that this will do any more than shift passengers from one airport to another. The situation in Northern Ireland is different: it is the only part of the UK that has a land border with another European country. That is the key difference.
Several noble Lords referred to Barnett reform, including the noble Lords, Lord Elystan-Morgan, Lord Bourne and Lord Thomas. The issue of fair funding is set out in the following way. The arrangements that we agreed with the Welsh Government, set out in our joint statement in October 2012, established a process to review the relative levels of funding for Wales and England in advance of each spending review. That process worked well at the spending review last year. It provides a firm basis for the devolution of income tax, should that be the outcome of the referendum. Convergence is not occurring at this moment; indeed, divergence is occurring, and funding levels are well within the parameters recommended as fair in the Holtham commission’s report, contrary to what the noble Baroness, Lady Morgan, said. If convergence is forecast to resume, we have committed to discuss it with the Welsh Government and to address it in a fair and affordable manner.
I thank noble Lords for their contributions. This Government have delivered for Wales on devolution and will go on doing so. Devolved Governments will be fairer and more accountable and will be able to create a stronger Welsh economy as a result of these proposals. It will be a giant step forward in the development of devolution. This Government are ambitious for Wales and are planning to give the Welsh Government the tools to do the job to stimulate the economy. It is up to the Welsh Government to use those tools effectively.
Wales: Cost of Living
Lord Wigley Excerpts(11 years ago)
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Lord Wigley (PC)
My Lords, I am very grateful. I will take one minute flat and truncate my comments. I thank the noble Baroness, Lady Morgan, for facilitating this debate.
I will make three points. First, earlier, we heard about the Government’s plans to cut energy bills. However, it appears that they will do little to help off-grid consumers, of whom there are many in rural Wales. My party, Plaid Cymru, wants to see the establishment of a not-for-distributable-profits company, Energy Wales, which could buy gas and electricity on the wholesale market, pass on savings to consumers and invest in services. Dwr Cymru provides a viable model for that.
Secondly, I draw attention to the 51% increase in excess winter deaths in Wales compared with the UK-wide figure of 29%. Last year’s figures showed Wales increasing from 1,260 to 1,900. Hardship can lead not only to misery but to death. People in rural communities in particular are suffering. That is why I want to see winter fuel payments made earlier in the year to off-grid pensioners so that they can buy gas at a lower price.
Thirdly, I will not trespass into Barnett, but I will point out that if the total public spending per capita in Wales was at the same level as that of Scotland in 2012-13, Wales would have received a staggering additional £1.6 billion—more than £500 per person. I hope that Labour will commit, during the 2015 election campaign, to putting that right.
Wales: Commission on Devolution in Wales
Lord Wigley Excerpts(11 years, 1 month ago)
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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.
Wales: Financial Powers
Lord Wigley Excerpts(11 years, 1 month ago)
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Lord Wigley
To ask Her Majesty’s Government what plans they have to give additional financial powers to the National Assembly for Wales.
The Parliamentary Under-Secretary of State, Wales Office (Baroness Randerson) (LD)
My Lords, the Government announced on Friday that they will implement the key recommendations made by the Silk commission in its first report and will enable the Welsh Government to use their existing limited borrowing powers to improve the M4 motorway as soon as possible. I will issue a Written Statement on this to your Lordships’ House this afternoon.
Lord Wigley (PC)
My Lords, I hope that this Question standing on the Order Paper helped to expedite the long-awaited response from the Prime Minister, which I welcome as far as it goes. Will the Minister confirm that she and the Government accept that the Silk report presented a balanced package, and that cherry picking that package would unravel it? Will she therefore state by when the other 20 or so recommendations that were not covered on Friday will be announced? Will they be in the Statement that she will make this afternoon? In particular, will she give an assurance that the legislation necessary to enact all the commitments that were made on Friday will be on the statute book before the next general election?
Baroness Randerson
I thank the noble Lord for his Question. Undoubtedly the continued interest in this issue from all sides of the House and well beyond it will have had an influence on ensuring that we had a positive response to the Silk commission’s first report. The Silk commission made 33 recommendations but the announcement on Friday did not go into detail on many of those. A full response to the Silk report will be issued in the next couple of months so that we will be able to deal with this by the end of the year. The intention is that a draft Wales Bill will incorporate Silk recommendations that the Government have accepted, where legislation is necessary. The Government intend to pursue that, if possible, in the fourth Session of this Parliament.
Local Authorities (Contracting Out of Tax Billing, Collection and Enforcement Functions) (Amendment) (Wales) Order 2013
Lord Wigley Excerpts(11 years, 9 months ago)
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The Parliamentary Under-Secretary of State, Wales Office (Baroness Randerson)
My Lords, this order will allow local authorities in Wales to make arrangements for an external provider to undertake some of the new administrative functions created by the introduction of council tax reduction schemes from 1 April when council tax benefit is abolished. These changes are part of the Government’s wider policy of decentralisation.
I will provide a little more detail on the contracting out order. It will amend the Local Authorities (Contracting Out of Tax Billing, Collection and Enforcement Functions) Order 1996. Currently under the 1996 order, local authorities in Wales can contract out functions connected with the administration and collection of council tax—for example, the calculation of an individual’s council tax liability or the serving of demand notices. Local authorities in Wales can also currently contract out the operation of the council tax benefit system under the Contracting Out (Functions of Local Authorities: Income-Related Benefits Order) 2002 if they choose to do so—arrangements that will cease once council tax benefit is abolished.
While some of the new administrative functions related to the introduction of council tax reduction schemes are already covered by the 1996 contracting out order, such as the processing of applications, some are not. To ensure that local authorities in Wales have the freedom to contract out all the new administrative functions, this order amends the 1996 contracting out order for Wales to add the following new administrative functions: first, the issuing of council tax reduction decision letters; secondly, the payment of a reduction amount under certain circumstances where the billing authority is of the opinion that it would be appropriate; thirdly, the serving of a penalty notice in connection with an offence committed with a reduction; and, fourthly, the repayment of amount paid in connection with a penalty under a local scheme—a penalty that has been subsequently quashed.
Because the abolition of council tax benefit also means that local authorities in Wales will no longer be able to rely on their current investigatory and enforcement powers for social security benefits, Welsh Ministers are making regulations to provide local authorities with replacement powers to tackle fraud in relation to council tax reduction schemes. These regulations will introduce new penalties, the collection of which has also been included as a function that could be contracted out under the 2013 order. Local authorities that choose to contract out functions will be expected to monitor the services delivered by their contractors. We expect the decisions taken by the contractor to be of the same standard as that of a local authority officer and subject to the same levels of confidentiality and data protection.
Local taxpayers’ rights will not be affected by this legislation. The same rights of appeal to the local authority and to the Valuation Tribunal for Wales will remain. While this order does not expand on the current provisions for the administration of council tax reduction schemes, it will carry out an essential function by enabling local authorities in Wales to choose how to deliver their local schemes, whether by using internal resources, external providers or a mixture of both. It is important that we provide local authorities with the tools they need to deliver a cost-effective council tax system. I commend this order to the Committee.
Lord Wigley
Perhaps I may ask for clarification on a couple of points by the noble Baroness. First, am I right in saying that the interpretation of this order is the provision of greater powers of privatisation for local authorities if they choose to use them? Is that the implication—services that would otherwise be in-house in local authorities can be undertaken by private companies on their behalf?
Secondly, I refer to Article 2 on,
“Amendment of the Local Authorities (Contracting Out of Tax, Billing, Collection and Enforcement Functions) Order 1996”.
In subsection (2), there is reference to,
“the Detection of Fraud Regulations”.
Are these regulations that have already been made? Are they made by the Assembly or here? Is there already a statutory instrument in effect on that, or are we awaiting something to be confirmed?
Lord Rowlands
I wish to ask two questions. First, how much contracting out has been carried out since the 1996 order was introduced? What percentage of local authorities have already contracted out in this field? The Minister referred to my next point. One should perhaps be concerned that we are handing over information on the personal financial matters of individuals and families to a variety of different organisations which might have potential conflicts of interest as opposed to a local authority, which will not, because it is a statutory body. The Minister talked about safeguards and data protection but if you diversify and decentralise in the manner in which this order hopes and expects, how will the individual be safe in the knowledge that his or her finances cannot be abused in any way? At least when the local authority has this information, it is a statutory body and therefore is obviously accountable in every sense of the word. How will that accountability be enforced across a range of other organisations or companies that will be delivering these services?
Baroness Randerson
My Lords, I thank noble Lords for their questions and remarks this afternoon. In principle this order does not change the way that councils deal with council tax. To deal with the first point of the noble Lord, Lord Wigley, it has always been possible for councils to contract out billing, collection and enforcement. Councils have been able to appoint an external provider to undertake some administrative functions. This order simply enables this to continue under the new arrangements from 1 April when council tax benefit will no longer exist.
As always I will try my best to answer the questions that noble Lords have asked. The noble Lord, Lord Wigley, asked whether this would mean greater privatisation. This order does not extend the powers that the local authorities already have to contract out their administrative functions in relation to council tax. As I have said, it allows them to apply them to the new council tax reduction schemes that are no longer part of the social security benefit system.
Lord Wigley
The Explanatory Note says that the order provides additional functions by way of authorising contractors. In other words, it goes beyond what was there before. Otherwise, presumably, we would not need it.
Lord Wigley
I do not want to go on unduly about this but, as I understand it, the legislation that we are dealing with today, here, was not scrutinised in the Assembly because it did not fall within the Assembly’s powers. If I understand correctly what the noble Baroness is saying, part of it—the part dealing with the fraud—does fall within the Assembly’s powers. The only point that I would make is that this underlines the need to simplify all this; matters are either devolved or they are not. That would make life very much simpler for everybody.
Baroness Randerson
The noble Lord makes an interesting point. It is something that we have come across on a fairly regular basis, that responsibilities are split in a way that is sometimes not obvious and sometimes surprising.
I move on now to the points made by the noble Lord, Lord Rowlands, who asked if there is more contracting-out now. I simply point out that this has always happened—for example, currently only three of the 22 local authorities in Wales have in-house bailiffs. Contracting-out on billing and bailiff services is very common. But a great deal of work has been done by the Welsh Government and by individual local authorities to have codes of conduct and best practice examples to ensure that bailiff services are run by improving standards over the years. A great deal of progress has been made on those issues.