Wales Bill

Chris Evans Excerpts

Tuesday 14th June 2016 Commons Chamber

[Chris Evans (Islwyn) (Lab/Co-op)]

It is a pleasure to have the opportunity to speak, Madam Deputy Speaker.

The Bill is the latest in a long line of Wales Bills to be presented to the House since the establishment of the Welsh Assembly. Part 1 of the Silk commission resulted in the Wales Act 2014, while part 2 has resulted in the Bill before us today, aside from its elements that were covered by the famous, great St David’s day agreement, which I am sure schoolchildren will discuss for the next 50 years.

The Bill represents the latest part of a long saga of political tinkering around the edges of devolution in Wales that has been a constant theme in political circles since the establishment of the National Assembly. Devolution has brought with it the possibility that Wales can make its own choices and go its own way, with its own Government elected by the people of Wales. The Welsh Government are entrusted by the people of Wales to act in their interest, and I am confident they have done so, in so far as they can under the current constitutional settlement. However, I believe that vast swathes of Wales have been turned off by the constant political debate over the constitutional arrangements. It almost seems as though the argument is, “Once we have the powers to Wales, all the problems in Wales will be solved.” That is a simplistic view of a complicated situation. What we need is certainty in a Welsh constitutional settlement that will last for longer than a few short years, or until we have the next commission funded by the Government.

This Bill is much better than the draft Bill. Like many Members, I had problems with the necessity test. To me, that was a simple case of a lack of understanding of devolution. It treated Wales as a Commonwealth outpost, with the Secretary of State doubling up as the governor-general. I am delighted, as many others will be, that the Bill removes provisions for a further referendum on income tax powers. I for one am looking forward to 23 June and the end of another referendum.

Until we settle this matter of constitutional certainty once and for all, considerable time—and, yes, political opportunity—will be spent arguing the merits of further constitutional change. As someone who came into politics to change the world, I do not want to waste the next five years, as we have the past 15, debating the dry subject of constitutional reform. That subject not only turns off the political commentariat, but costs money.

When the Silk commission was set up, the then Secretary of State for Wales gave it a budget of “around £1 million”. Overall, the Wales Office spent £1.3 million on the Silk commission between 2011-12 and 2014-15. If we do not show ambition with this Bill and leave more to be argued and debated for years to come, what will be the cost? How many more commissions will we need to create? A freedom of information request to the Wales Office found that the 2011 referendum on powers to the National Assembly was expected to cost upwards of £8.2 million. How many more referendums will we need to go through, and at what expense, before we reach a final constitutional settlement?

The real question and the real test of any Wales Bill, or any Bill that comes before us, is this: what in this Bill will speak to the people of Wales and address their day-to-day concerns? Although support for further powers for Wales is strong, with 43% of respondents to the BBC/ICM St David’s day poll this year saying that the National Assembly should have more powers, and only one in three people saying things should stay as they are, the issue does not really enter the daily lives of my constituents. I cannot recall a single instance in the past few years when a constituent has written to me about the Welsh constitutional settlement. Indeed, when I was knocking doors just a month ago, not a single person spoke to me about the Wales Bill, the Silk commission or the Williams and Smith commissions. All these people have entered the lexicon of the commentariat who go absolutely mad for constitutional reform, but to the people on the streets, they mean absolutely nothing.

Having read the Bill, I think it is little wonder that people are switched off when the issues discussed are of so little relevance to their lives. The dry subject of constitutional reform might float the boat of commentators and politicians in this place and in Cardiff Bay, but it is simply not something that people talk to me about on the doorstep. The prospect of Wales switching from a conferred to a reserved powers model might have excited some, and the necessity test might have caused a row here and in Cardiff Bay, but I have to say that people on Blackwood high street in my constituency who are trying to feed a family on a shoestring budget, who are signing on in the jobcentre as they have still not been able to find a job, or who are desperately trying to find ways of making do after their disability payments have been slashed care very little about the Wales Bill.

The one element of the Bill that will have a direct impact on my constituents is the devolution of some—not all—income tax powers to the Assembly. I have long been an advocate of regional taxation. I genuinely believe that the challenges we face in Wales are different from the ones faced here in London, which is an economic powerhouse, and from those in the north, in Scotland and in other regions. However, as we pull ourselves to pieces over whether we can devolve income tax or have a referendum, we should reflect that this means nothing if we look at the Scottish model. The Scottish Parliament has never raised income tax or used the powers given to it in 1999. It seems an absolute moot point.

The fact of the matter is that we are an economy that is heavily based on the public sector, rather like in Northern Ireland and the north-east. If we are allowed to start reducing income tax rates, we may start attracting ever greater numbers of entrepreneurs and wealth creators to the Welsh economy. It is a contradiction in terms that Northern Ireland, which has high public sector unemployment and fewer businesses and entrepreneurs than it should—very much like Wales—should be allowed to slash its own corporation tax in the hope of attracting more businesses, as its neighbour in the south has done, while Wales cannot.

Why is it good for Northern Ireland to have the power to alter corporation tax when Wales does not? Although it is true that Northern Ireland has a land border with the Republic of Ireland, which has notoriously low corporation tax rates, Ireland is still only a short distance from Wales, so we are competing with it. We are a small island race. We can get to Ireland and back in one day, yet we are not allowed to compete. Northern Ireland is allowed to reduce its corporation tax, attracting massive business to come in and create jobs, while we are to be fed with the scraps. Yet again, it seems that Wales is being forced into the role of the poor cousin. Do we want a powerhouse economy, moving forward and attracting high-tech, high-skilled jobs, or we do we want to continue to be reliant on the public sector and grants from the European Union? Regardless of how the referendum goes in a couple of weeks’ time, that is no future for the people of Wales.

Wales is a country with access to cutting-edge technologies and a skilled work force. General Dynamics in Oakdale in my constituency, and BAE Systems in Glascoed, in the constituency of my hon. Friend the Member for Torfaen (Nick Thomas-Symonds), underline this fact. They attract some of the finest minds from our universities, but how can we attract more good people unless the Government are given the lever of corporation tax to encourage more large businesses to come to Wales, bringing jobs with them, and the lever of income tax so that people can have more money in their pockets to spend in our local economies, such as on the high streets that I mentioned earlier? I believe that that is the way forward.

As for the rest of the Bill, it seems that, again, there is a working group of officials from the Wales Office, the Ministry of Justice, the Welsh Government and the office of the Lord Chief Justice to monitor the prospect of a Welsh jurisdiction. That, surely, is legislating for legislation’s sake. The joint legal jurisdiction in England and Wales has been maintained for just under 500 years, and I believe that tinkering around the edges of that could cause more problems than it would solve. We must either commit ourselves to a wholesale split and devolution of policing and justice, or retain the union of the England and Wales legal jurisdiction.

Those are the questions that we should be asking in the Bill, but we are not asking them. Again, we are just tinkering around the edges. We shall be back here again in two or three years’ time with another Wales Bill, which will cause more constitutional uncertainty and more arguments in which people are simply not interested. The message, in my view, should be that the Bill could have been so much more. It could have settled, once and for all, the constitutional argument in Wales. It could have allowed constitutional arguments to be put aside, with a line drawn under them, so that we could get on with the things that really concern people: health, education and transport. Those are the bread-and-butter issues that affect families and constituencies across Wales.

The Bill represents yet more tinkering and yet more argument. It must be realised at some point that what we discuss in this place when we talk about the constitutional settlement is far removed from what concerns people in Wales. I support the Bill, but I am extremely disappointed, because it could have been so much more—it could have brought about the ambition that we need in Wales.

--- Later in debate ---

[Craig Williams]

I thank my hon. Friend for making one of his classic interventions. I touched on this when I spoke about the heart and head. I disagree fundamentally with a lot of what the Welsh Labour Government do, but I support the institution of the Welsh Assembly, and I want to strengthen it and one day return a Welsh Conservative Government who have the levers and powers to get on and do the job.

I will touch on bus regulations a little later. I refer Members to my declaration of interests: I served on the board of a major bus company for many years, and I welcome the bus regulations we are giving to the Assembly, because of the importance of issues such as integrated transport.

I do not want to jump around the issues too much, but the hon. Member for Islwyn (Chris Evans) mentioned corporation tax, and there is always something else to get. Now business rates are with the Assembly. In terms of the Cardiff city deal and getting high-value companies from London to Cardiff, we have discretion over business rates, and we can do exciting things with them. Rather than talk about more powers again, we should encourage the hon. Gentleman’s colleagues in the Assembly to put a visionary bid together with the powers they already have, if we manage to get this Bill through with income tax included.

[Chris Evans]

I was talking about the fact that we need certainty now in the constitutional settlement. I would be happy to see corporation tax devolved in the Bill, in the hope we will not be revisiting this, as we have done over the last couple of years. The reason I mentioned corporation tax is the example of the Republic of Ireland, which has been very successful in getting some large companies to headquarter there.

[Craig Williams]

I accept that point, but I hope the hon. Gentleman sees where I am coming from. Complacency sinks in when we give the Assembly more powers. It thinks, “Right, we’ve got them, and rather than think about what to do with them, we’ll think about what we want to ask for next.” What could be done with corporation tax and what can already be done with business rates is a good example of that.

I want to talk a little about the capital side of this. The more revenue streams and accountability we are able to give the Welsh Government, the more capital they can borrow, so the more capital they can put into infrastructure projects off their own bat, and we can judge them on the success of that. The Commonwealth games bid will require some capital. More revenue streams, and more accountability and transparency in being able to raise money, would mean that we could make a Commonwealth games bid in Wales. We could put more into the south Wales metro, too, and top up the Cardiff city deal. At the moment, the Welsh Government come to Westminster to access borrowing powers—the old Welsh Development Agency powers, for example—but this Bill tidies things up: it enables the Welsh Government to get on and hopefully deliver for the people of Wales. If they do not, we can more appropriately judge their failure or success.

I have touched on the worrying parts of the RIFW scandal and how I see that as an example of a lazy approach and attitude within the Welsh Government and Welsh Assembly more broadly, but I want to move on to the single legal jurisdiction question for Wales. I believe that a single legal jurisdiction of England and Wales has served us well and should be maintained. Although we acknowledge that the Assembly is now going to make a greater body of law, and I commend this Bill for tackling what has been a very thorny issue, I agree that the disruption and cost of establishing a separate legal jurisdiction is not justified at this time. A separate jurisdiction would create upheaval and huge cost for no good reason.

Another issue that has been modified owing to the scrutiny of the draft Bill is the formal recognition in this Bill of a body of Welsh law made by the Welsh Assembly and Welsh Ministers—or Welsh Secretaries, as I should now call them. This change reflects the importance placed on this matter during the revision process in the past few months. Most of the debate on a distinct or separate jurisdiction revolved around the necessity test, and I am hoping that the Bill in its present form will have lanced that boil. I am sure that we will hear more about that from Plaid Cymru Members later. The Welsh Affairs Committee, on which I am proud to serve, concluded that the necessity test was wrong and recommended that it be replaced. I therefore welcome the Secretary of State’s approach to this issue.

The body of Welsh law continues to grow. I have made the point in the Welsh Grand Committee and the Select Committee that the Assembly is making Welsh laws and a body of Welsh laws exists, and that the Assembly should have the security and confidence to stand up and say that, rather than constantly looking for reassurance from Westminster that it can have its own body of laws. We can now build our legal infrastructure around the body of Welsh laws, but we would risk economic and commercial damage if a separate jurisdiction were pursued. We would risk a flight of talent, given that Cardiff has strong professional legal services. We would also face problems with our universities. The University of Aberystwyth is in the constituency of the hon. Member for Ceredigion (Mr Williams), and I would not want to put it or any other Welsh university in a position of having to debate whether to teach English or Welsh law to international students. That might be a difficult one for the dean of law at Aberystwyth. For all those reasons, I support the Government’s belief in maintaining a shared legal jurisdiction, and I welcome the work being undertaken by representatives of the Lord Chief Justice’s office.