Wales Bill

Chris Bryant Excerpts

Monday 31st March 2014 Commons Chamber

[Mr Jones]

Indeed. I think that everyone in the south Wales business community recognises that the M4 is indeed a foot on the windpipe of the economy and we are anxious to see it upgraded. The competence that we shall be giving the Assembly Government—in fact, we have already extended it to them—will enable them to proceed as quickly as possible with that essential upgrade.

[Chris Bryant (Rhondda) (Lab)]

While we are on infrastructure improvements, the Government here have much boasted that they will be electrifying the valleys lines. Every time they seemed to suggest that they would pay for it, but now it seems they are refusing, so who will actually be paying for the electrification of the valleys lines?

[Mr Jones]

We are skiing somewhat off piste, because that is not within the competence of this Bill, but there is clear correspondence between the Assembly Government and the Department for Transport on how the upgrade would be funded, and it is absolutely clear that the Welsh Government were paying for the upgrade of the valleys lines.

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[Mr Jones]

It should be entirely clear to the hon. Gentleman, because the Under-Secretary of State for Wales, my hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) took the trouble to write to the Chairman of the Grand Committee, the hon. Member for Gower (Martin Caton), on 10 February, setting out these matters in great detail. I know that a copy of that letter was sent to the hon. Gentleman, and he will know, having read it, that the provisions are as follows:

“In the first year of operation (and any transitional years) the block grant adjustment will equal the amount of tax revenue generated by the Welsh rate of income tax set at 10p. It is important to note the following:

This is the amount of income tax forfeited by the UK Government as a result of reducing the main rates of income tax by 10p in Wales. If the Welsh Government sets a rate of 10p then there will be no impact on their budget compared to current arrangements. By setting a rate of, for example, 11p or 9p the Welsh Government can increase or decrease its budget (respectively) compared to current arrangements, as the block grant adjustment will still be based on the 10p forfeited by the UK Government. That means that the higher or lower revenue resulting from a rate of 11p or 9p (rather than 10p) would not be netted off the block grant.”

[Chris Bryant]

Riveting.

[Mr Jones]

Well, the hon. Member for Pontypridd had not read this letter, so I am reading it out to him. It goes on:

“In subsequent years the initial deduction is indexed against movements in the UK NSND”—

that is, not savings, not dividends—

“income tax base. That means that if the UK NSND income tax base contracts by 2%, the block grant adjustment will decrease by 2%; if the tax base grows by 2%, the adjustment will increase by 2%.”

That should have been absolutely clear to the hon. Gentleman, but he clearly did not read the letter, so I am glad to have had this opportunity to acquaint him with its contents. It clearly contains the reassurance that he seeks.

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[Chris Bryant]

The Secretary of State has used the word “accountable” 14 times so far in his speech and has talked about how this Bill will make politicians in Wales more accountable, but it is going to mean that there will be fewer elections. Does that not make them less accountable?

[Mr Jones]

I would not have thought so. By the way, I am grateful to the hon. Gentleman for counting how many times I have used the word “accountable”. That now makes 15. I would have thought that he would be concerned to ensure that Assembly elections were not overshadowed by general elections, and that in my book makes for accountability.

[Mr Jones]

My hon. Friend was involved in that Bill, and he is of course entirely right.

[Chris Bryant]

The thing is, it is the former Minister who is not very joined up with his own memory. At the time, Labour voted for a four-year fixed-term Parliament in here, which would have meant a four-year fixed term for Wales as well. In that way, we would not have had to coincide and we would have had greater accountability. Let us have a general election now, shall we?

[Mr Jones]

As we have five-year terms for general elections, we take the view that we should also have five-year terms for Assembly elections.

The removal of the ban on dual candidacy restores the position to how it was in the Government of Wales Act 1998. I believe that the change is supported by all parties other than the Labour party, which introduced the ban in the first place. The ban on so called “double-jobbing” between the Assembly and this House addresses legitimate concerns about whether it is possible for someone adequately to represent constituents’ interests in two elected legislatures at the same time.

The legislation also implements several changes that have been specifically requested by the Welsh Government, including formally enshrining that name—the Welsh Government—in statute, as it has been common parlance for the Welsh Assembly Government to be so referred to for several years now.

In responding to the Silk commission’s recommendations, the Government made it clear that we were unconvinced by the case for devolving air passenger duty to Wales, so the Bill makes no provision for that. Neither does it make provision for the full devolution of business rates. That is because, in terms of legislative competence, business rates fall within the devolved subject of local government finance and so we need make no further provision in this Bill. In order fully to devolve business rates, the Government are amending current funding arrangements so that the Welsh Government benefit directly from revenues raised by that tax in Wales.

Finally, as I said in my written statement to this House on 3 March, we do not see this Bill as an appropriate vehicle for implementing the recommendations made by the Silk commission in its second report. The commission’s second report raises crucial questions about the future governance of Wales within the United Kingdom, and it would not be right to rush into implementing its recommendations without careful assessment. It is essential that we take the time needed to get things right. Consequently, the Bill is focused on devolving the package of tax and borrowing powers to Wales recommended by the commission in its first report. Including a whole raft of other powers would merely serve to delay the Bill and jeopardise its enactment before the 2015 general election.

The Government believe that devolution should be used to give a competitive edge to Wales, and that powers devolved should be used to grow the Welsh economy and make Wales a more prosperous place. The Bill will deliver that. It will make devolved governance in Wales fairer, more accountable and better able to support economic growth. I hope, and I believe, that we can achieve a broad consensus in this House around this Bill, and make rapid progress. I commend the Bill to the House.

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[Owen Smith]

I put to the hon. Gentleman the impact assessment and the explanatory notes from his own Government. They make it clear that this is a partisan measure that will only benefit the minority parties in Wales, among which we count the Conservative party. That is what this is about.

[Chris Bryant]

Is it not particularly irritating that Leanne Wood can stand in Rhondda? She has done it before: she stood in 2001 for the parliamentary seat and lost very heavily. The people of Rhondda will, I am sure, return Leighton Andrews in the next Assembly elections, because he is the best Assembly Member in Wales. They cannot prevent Leanne Wood from being elected, however, because they have no means of affecting the order on the Plaid Cymru list. She gets two goes.

[Owen Smith]

Absolutely. The only thing I would contest in my hon. Friend’s intervention is the suggestion that Leighton Andrews is the best Assembly Member in Wales. That particular accolade goes, of course, to Mick Antoniw, the AM for Pontypridd.

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[Mrs Cheryl Gillan (Chesham and Amersham) (Con)]

Rising to my feet to participate in the debate gives me a heavy attack of déjà vu. I hope my words will be slightly less curmudgeonly than those of the hon. Member for Pontypridd (Owen Smith). I give this small and elegant Bill a warm welcome, because I believe it takes Wales forward. It does so in a small, incremental step, rather than in one of those steps that allows Wales to fall into a large hole and disappear without trace. The Government are looking after the interests of Wales and the people of Wales in the Bill. Long may that continue.

As many hon. Members know, for me, the Bill is part of unfinished business that stretches back not to when I was Secretary of State for Wales, but to my appointment as shadow Secretary of State. I pay unreserved tribute to Paul Silk and members of the Silk commission. The Calman commission did not attract the Scottish National party to sit alongside other members, but I was really pleased when Plaid Cymru accepted the invitation to join the Silk commission. The participation of all the parties involved in the governance of Wales in the Silk commission has made its results more credible. I believe it will contribute towards Wales remaining part of the Union, on which most Opposition Members agree with Government Members. I also believe that the commission will contribute to Wales having increasing self-determination in certain matters, which will be good for the people of Wales and for the devolved Administration.

The trend towards more local democracy must not be at the expense of effective governance. That brings me to a point that became apparent to me over the seven years in which I carried responsibility for Welsh policy in my party. In future, I believe that a confident Wales and a confident Westminster Government should not hesitate to contemplate not only the devolution of powers, but the return of areas of competence to the supra-national Parliament, if it is the wish of those areas or institutions. There is a valid and compelling case for that course of action. That was not apparent in the Silk commission report, but by way of example, it was expressed to me while in opposition and in government, particularly from the university sector—albeit often behind closed doors for fear of repercussions—that a body of opinion wanted the re-coupling of Welsh and English universities in the interests of Wales and of education in Wales.

As we have been reminded, the constitutional position in the Bill is that we are extending the Assembly’s term of office to five years. That is probably sensible given the circumstances, but, for me, the jury is out on five-year terms. I was persuaded by the First Minister that that was the way to go because the UK Parliament introduced a five-year term and we need to avoid a clash of an Assembly election with a general election. However, I question the wisdom of that. All hon. Members know how expensive democracy and elections are. I would have liked to have seen the cost savings that would have resulted from running those elections together and any effect on turnout. It does not matter which part of the UK people are in, there is no doubt that they are being turned off by democracy—we are seeing diminishing returns of voters going to the ballot box. Perhaps running those elections at the same time would have increased participation at the ballot box. It might also have been easier to explain the relationship between the Assembly and the UK Parliament.

[Chris Bryant]

I am grateful to the right hon. Lady for giving way because I rather agree with her. Voters would probably prefer to have two elections on the same day. That would make far more sense—I have argued for it since 2010. Historically, general elections have tended to be every four years, even when we had seven-year terms, because either a Government had run out of steam or it felt right to move on and have an election. We are now moving everything towards five-year terms. My anxiety is that that is less democracy and less accountability.

[Mrs Gillan]

The hon. Gentleman makes a good point—it is unusual for us to agree on anything, as he will attest —but we need to examine the matter before we set everything finally in concrete. Those on both Front Benches and anybody involved in the business of government should keep an open mind. Rather than saying, “It will be five or seven years for ever,” we should agree to revisit the matter at some stage. Constitutional arrangements are important, but the engagement of the electorate is perhaps one of the most important aspects of democracy.

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[David T. C. Davies]

Obviously, I am speaking as an individual Back Bencher; it was hard to get any agreement on certain of these issues from the Welsh Affairs Committee. Let me make it clear that I am not speaking for anyone in the Conservative party either—I am entirely on my own on this one, and probably always will be.

I would like to see one improvement that can be made to this Bill. If we consider the powers the Welsh Assembly has already been given, we can see that it has not done terribly well. We have had the sight of the Welsh Minister for Education and Skills apologising, on Boxing day, I believe it was, for the lamentable state of education. As someone who has been through the state school system there, and who has three children in that system, I feel that very strongly. Nor have we seen a good performance from our national health service. Large numbers of people in cross-border areas such as Monmouthshire are desperate to be treated by the coalition Government-run NHS in England. We have even had the spectacle of a Labour Member of Parliament being banned from going before the Health and Social Care Committee in the Welsh Assembly because she was likely to tell a few home truths that members of that Committee did not want to hear. There has thus been a failure even to carry out the proper scrutiny role.

What I would like to see from this Bill is the opportunity not to take powers away from the Welsh Assembly, but to recognise that where there are problems, individuals ought to be given the choice. Somebody in Wales who is ill and wishes to be treated in England should have the right to access the NHS in England, with the cost of treatment being deducted from the block grant. Similarly, if someone in England was happy to wait twice as long as they needed to and be treated in Wales, they could be treated in Wales, with the cost of their treatment being added to the block grant. That would be an excellent way for us to maintain the commitment to devolution while allowing everyone to enjoy the benefits of a national health service.

[Chris Bryant]

The hon. Gentleman thinks it would be much better to move to a federal system. My problem is that that denies the history of all the different parts of the United Kingdom: the whole of Ireland was a kingdom until the partition and so on; Scotland had a completely different legal system even when the Crowns were joined together; and Wales never had a separate legal situation. Asymmetric devolution is actually the most sensible way of progressing.

[David T. C. Davies]

That is a reasonable intervention from the hon. Gentleman. I respond simply by saying that a federal approach is not a perfect solution, but it is probably the least worst solution, and it is better than waking up in 20 years and finding that we have fully fledged independence. Wales has had a slightly separate legal system; I believe that Henry VIII allowed Wales a measure of independence, except for Monmouthshire, which was brought into the Oxford assizes—we do not need to go into that now.

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[Mr Hain]

That intervention interests me. Is the hon. Gentleman saying that whoever stands for whichever party, even if they are deeply opposed by the particular constituents whom they seek to represent, cannot be challenged because they are standing on a party label?

[Chris Bryant]

Is not the point also that Wales is not the only place in the world that has a top-up system to enable diversity within the legislature, but it will be the only place in the world where that practice of standing both on the list and for the first-past-post seat is used?

[Mr Hain]

I bow to my hon. Friend’s superior experience and knowledge. I think that the system applies in Scotland.

[Chris Bryant]

It does in Scotland, but I mean outside the United Kingdom.

[Mr Hain]

It may well be the case that it exists outside the United Kingdom.

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[Mr Harper]

My hon. Friend makes a good point. Notwithstanding that point, the hon. Lady’s Front-Bench colleague, the hon. Member for Pontypridd (Owen Smith), committed at the Dispatch Box to reversing the provision, if I heard him correctly. Her admonition against frequent change should be aimed at him as much as the Secretary of State.

[Chris Bryant]

Will the hon. Gentleman give way?

[Mr Harper]

I will give way one last time before moving on to tax powers.

[Chris Bryant]

I knew that the hon. Gentleman would never be able to turn me down. Most countries in Europe have a fixed constitution, which means that they cannot play around with their electoral arrangements. In recent years we have changed the date of the Assembly elections and the local elections, and then we had to change them again because we had already changed the Assembly elections. The voters of this country must surely feel that we play around with the electoral system far too much.

[Mr Harper]

That does not fit my recollection. Let me think about the change of date for the Assembly election. It was carefully thought through. We consulted the leaders of the parties in the Assembly; I recall that I found out the views of the presiding officers before we amended the Fixed-term Parliaments Bill.

The hon. Gentleman might not agree with the system, but all the parties in the Welsh Assembly agreed to it. The change was made for what was argued to be a sensible reason—to prevent the two elections from coinciding, so that the important issues facing the people of Wales would be properly debated rather than being overshadowed by other issues facing the people of the whole United Kingdom. My right hon. Friend the Member for Chesham and Amersham put the alternative view that the elections should be held on the same day, and the hon. Gentleman has put forward the same view today. However, having separate election dates seems to me perfectly sensible, and that was the view taken by the Government and this Parliament.

[Chris Bryant]

The thing is that we never shorten the mandate; we always lengthen it. Now local authorities in Wales will end up having five years—possibly six—and that will be the second time they have had five years during my time as an MP in Wales. The Assembly is also going on to five years. It feels as if the political class is constantly saying, “Let’s give ourselves a little more time.” That undermines the democratic sense of British politics.

[Mr Harper]

I have listened carefully to both the hon. Gentleman’s points and the one made by the shadow Secretary of State. It seems to me that they were both taking the brave point of view—presumably, it was a commitment from the shadow Secretary of State—that if the Labour party were, God forbid, to win the next election, it would amend the Fixed-term Parliaments Act and reduce the fixed term to four years. I am not sure whether the shadow Secretary of State has consulted his party leader about that, although I hope he has, for his sake. That seemed to be a clear commitment from him. If the Labour party wins the election, we will see whether it reduces its time in office. I know that the hon. Member for Rhondda (Chris Bryant) says that his party voted for a shorter term when in opposition, but I am pretty confident—I said this at the Dispatch Box, I think—that if his party returns to government, it is highly unlikely that it will vote to shorten its term of office. I might be proved wrong, but I doubt it.

I welcome in general the Bill’s proposals on the devolution of tax powers for the clear reason of accountability. As someone with a constituency on the border, I think it wrong that the Welsh Assembly Government, like the Scottish Government, can spend money on enticing business across the border, but are not accountable for raising the money that they use to do that. Proposals to devolve some of the taxes are sensible; it makes absolute sense for there to be more accountability.

On the issue of capital borrowing, I should say that I am sorry that the hon. Member for Swansea East (Mrs James) is not in the Chamber any more. Let me elaborate a little on my short intervention on her. I looked at the “Wales Bill: Financial Empowerment and Accountability” paper that the Government laid before the House. It is a strange plot, to use the word of the hon. Member for Swansea West (Geraint Davies), that is published and laid before Parliament; I thought plots were conducted in secret, but obviously things have changed.

The paper seems clear: it sets the statutory capital borrowing limit at £500 million. That is linked to the £200 million or so of revenue that is initially being devolved. The limit is higher than if it had been set solely by reference to the same tax borrowing ratio that applies to Scotland. In Scotland, there is a £5 billion responsibility for tax revenues, but only a £2.2 billion capital borrowing limit. If my right hon. Friend the Secretary of State had used the same limit in Wales, there would have been a £100 million capital borrowing limit instead of a £500 million one.

My right hon. Friend has met the challenge to show his workings, which were in the paper presented to the House and available to all Members before this debate. He has clearly set out how the Government reached the £500 million limit. As my hon. Friend the Select Committee Chairman said, the limit was increased to £500 million to allow the Welsh Government to proceed with improvements to the M4, should they choose to, in advance of that element of income tax being devolved. The Government judged that such borrowing was affordable for both the Welsh Government and in relation to the UK’s overall position. That seems a sensible position, which has been transparently laid out in the paper.