Scotland Bill

Earl of Caithness Excerpts

Wednesday 21st March 2012 Lords Chamber

[The Earl of Caithness]

I wonder whether my noble and learned friend can help me with the parliamentary procedure. We are discussing the referendums this afternoon. When are they going to be dealt with on Report? As my noble friend Lord Forsyth has just said, they were delayed at this stage. Is it likely that we will be discussing them on Monday? If so, those of us who have to travel to the far north of Scotland tomorrow will have precious little time to table amendments. It will give us at least a day or two longer to consider matters and read the Official Report if they are to be dealt with on Wednesday. It is crucial for us in how we conduct our business to know whether the referendum issue will be taken on Report on Monday or Wednesday.

[Lord Foulkes of Cumnock]

I understand the noble Lord’s frustration about the whole process and the way it has been dealt with. The noble Earl, Lord Caithness, makes a very good point, which others made earlier, about the time between Committee and Report. The noble Lord, Lord Forsyth, also made that point effectively.

I think we should absolve the noble and learned Lord, Lord Wallace of Tankerness, of blame in relation to this. He has been faced with great difficulties from a number of sources. I was going to include the noble Lord, Lord Forsyth as one of the people who created some difficulty for him, but I will just put that to one side for a minute. The noble Lord has had to labour with a Cabinet which has only recently begun to realise some of the implications of Scottish independence and what it might mean—to our defence policy and to a range of other things—if it were to go ahead. It has taken some time for it to realise the enormity of the possibility of Scotland seceding from the rest of the United Kingdom, and that is something that the noble and learned Lord, Lord Wallace, has had to deal with. He has also had to deal with a very difficult negotiating body in the Scottish Executive, and its leader in particular. Driving a bargain with it is not easy.

We should consider that earlier this week—and I hope I am not giving any secrets away—we may not have had even this letter and the Statement today if it had not been for the intervention of the noble and learned Lord, Lord Wallace of Tankerness. Admittedly, he was under pressure from the Opposition—both the Front and Back Benches—and no doubt from the noble Lord, Lord Forsyth, as well, but it is to his credit that he got us the Statement. Otherwise we would really have been dealing with it in the dark.

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[The Earl of Caithness]

My Lords, I support what has been said so far. The present situation, as is increasingly becoming clear, is untenable. It goes against the principle that I have been arguing all the way along. I am in agreement with the noble Lords, Lord Foulkes of Cumnock and Lord Steel of Aikwood. I believe that the only sensible way for the Scottish MSPs to be accountable is for them to be able to raise revenue as well as spend it. We are prohibiting that accountability and to me that is a very serious mistake which needs to be corrected at a later stage of the Bill. I think it is untenable for the future and unless we nip this in the bud now, it will be of increasing concern and will lead to a distortion of some of the benefits of devolution. It will become a real Achilles’ heel for people. Every time there is a change of allowances in one country that is different from another, we will have these consequences. Now that we know exactly what will happen, we have a real problem ahead of us.

[Lord Lyell]

Perhaps I may put a gloss on what my noble friend has said about these taxes. He refers to accountability. I make the point that in Clause 30 of the Bill, let alone anywhere else, there is no accountability to English, non-Scottish voters, who will be classified by the Bill as Scottish taxpayers. Where is the accountability? It is not there.

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There is an important distinction between a convention and a Section 30 order. A number of different orders can be promulgated under the Scotland Act 1998. Indeed, there is a schedule with headings (a) to (j)—possibly more—that state the procedures and processes in respect of each order. I know that noble Lords have had debates in the Moses Room on Section 104 orders, which very often relate to when the Scottish Parliament is unable to give full expression to its legislative proposals because they may well have non-controversial implications for matters or bodies that are reserved. After working with the United Kingdom Government, it is possible to bring forward an order that can then give full effect to such proposals. We recently considered such an order with regard to social housing. There are a number of examples. These are matters of law, and a Section 30 order is used to transfer or make changes to Schedule 4 to the Scotland Act. Schedule 5 sets out the specific issues that are reserved under that Act. A Section 30 order requires the consent of the House of Commons, the House of Lords and the Scottish Parliament. It is not a convention. If the Scottish Parliament withholds its consent, a Section 30 order cannot pass. That is why it has legal effect in a way that the Sewel convention does not.

[The Earl of Caithness]

My Lords, on that point, will the Minister confirm that my noble friend the Duke of Montrose was right to say that we cannot amend a Section 30 order here and that we have to either reject or accept it?

[Lord Wallace Tankerness]

It is generally the case for all orders that they cannot be amended. However, in earlier exchanges, the noble Lord, Lord Foulkes, asked whether there might even be a draft order. Actually, it was the noble Lord, Lord Sewel. My apologies —it seemed to happen so recently. He raised the possibility of a draft Section 30 order. I indicated then that if it related to the important issue of the referendum, we could take the opportunity of the debates that we are, I hope, about to have to get the reflections of your Lordships on these matters.

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[Lord Forsyth of Drumlean]

Yes, I just wondered who dictated it. I am sure it is the noble Lord’s own work; it is just that it is such a change of position in such a short time. We have discussed this ad nauseam and it is perfectly clear that there is agreement in this House that there should be one question and that the referendum should be conducted by the Electoral Commission and no one else.

I like the question that is in the amendment moved by the noble Lord, Lord Foulkes, but I am perfectly content for that question to be determined by the Electoral Commission. That is where we may end up. My preference would be for it to be decided by the Government, but I can see how that would create difficulties. The important point is that this whole process needs to be regulated by the Electoral Commission and needs to be conducted under the rules that have been established in statute for the conduct of referenda. I am very happy not to move my amendment and not to spend any more time talking about referenda in the context of this Bill, because this Bill is clearly not going to be used as the vehicle.

My noble and learned friend has been brilliant in his negotiations with Mr Alex Salmond, but I am not absolutely persuaded that Mr Alex Salmond is going to agree to a Section 30 procedure that meets all the criteria. The point that was made by the noble Lord, Lord Williamson, really needs to be taken into account. We do not want any shilly-shallying or giving way on these important points of substance. This is very important.

Mr Salmond does not want to have a referendum on independence because he knows that he will lose, and I am anxious that my noble and learned friend may be optimistic about reaching agreement. However, given his track record, he may well be able to reach agreement: in which case, fine. If he is not able to reach agreement, we will have to have a referendum Bill in the next Session of Parliament that delivers these things. I regret that, because unless there is agreement between the Front Benches to take this through the House reasonably speedily we will have another six or seven months of arguing about process, about the question and about who should run it, whereas I want the debate to be about what happens to Scotland’s young people, the jobless, our businesses, our defence, people’s pensions, and our country as a United Kingdom.

If we are going to go down this track, I very much hope that the negotiations will not be particularly extended. I believe in competition but, honestly, competition between consultation papers is a bit rich. The Scottish Government’s consultation finishes in May. If this is the route that we are going to go down, let us hope that, at a reasonably early stage in the new Session of Parliament, either we will have reached agreement with the Scottish Government on using Section 30 or the Government will have brought forward a Bill that is taken through both Houses speedily and delivers the opportunity for a decision to be made. I would have preferred it if we had used this Bill to achieve that because we could have got on with it, but given the Government’s Statement and the fact that we have to deal with all amendments by next Wednesday, it is perfectly apparent that that is not going to happen. I am content not to press my amendment.

[The Earl of Caithness]

My Lords, I have put my name to the amendments tabled by the noble Lord, Lord Foulkes, and my noble friend Lord Forsyth. As my noble friend Lord Forsyth has just said, these amendments went down last year, long before the UK Government sent out their consultation paper, let alone the Scottish Government bothering to send out theirs.

I am not in the least bit fearful of a referendum in Scotland but I am worried about the consequences. The break-up of the United Kingdom at the behest of a minority, which might prejudice the majority, is something of great concern. As the noble Lord, Lord Foulkes, has said, it has huge implications for the rest of the United Kingdom. I am told that when Czechoslovakia divided in 1992, some 30 treaties and 12,000 legal agreements were required. There is going to be a huge amount of work resulting from a decision to have an independent Scotland, if that is the one that is taken.

I hear what noble Lords have been saying about this being a matter for Scotland, and indeed it is, but it is such a big matter that the referendum in Scotland should then be followed by a referendum in the UK. There are huge implications for the rest of the UK; for example, in Brussels, where our ability to get a blocking minority at the Council of Ministers will be altered because the number of votes that we have will be reduced. I spoke about this in an earlier debate. It might very well threaten our permanent seat at the United Nations.

There are a lot of reasons why it is so important that the United Kingdom is kept together, which, if it is broken by a minority, will have huge implications. That is why I have put forward my Amendment 89, which says that the referendum in Scotland should be advisory and could be implemented only if it was agreed in the rest of the United Kingdom. We are sleepwalking into a whole lot of issues that have not been discussed, the implications of which nobody fully understands, and which the vast majority of the United Kingdom will not have a say on.

My Amendment 90 is an amendment to Amendment 88 and says that if the vote in a referendum held in Scotland is for a separate Scotland—I do not say “independent Scotland” because Scotland is about as independent a country as you can get—but that if the people of Orkney and Shetland vote to remain in the United Kingdom, they should be allowed to do so.

The obvious argument in favour of that is the argument that has been expounded about Scotland, which I have just spoken about. Here we have a minority of people in the United Kingdom saying “We want to become separate” or “We could want to become separate”. The rest of the United Kingdom has to accept that, as the noble Lord, Lord Reid, thinks is right. I am saying that if Orkney and Shetland decide that they want to stay in the United Kingdom—although that is not the only alternative for them—their wish should be granted.

When this amendment was put down, it raised a lot of concern from the usual rent-a-quote SNP MSPs who jumped up and down and said, “This is Westminster dictating to us in the far north”. No it is not; it is merely giving a chance for democracy. There is a fear in the far north of the centralisation that has taken place in Edinburgh.

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[Lord O'Neill of Clackmannan]

Does the noble Earl anticipate there being a polling station on Rockall and the like? We are dealing with matters of rather greater significance than these flights of geographical fancy.

[The Earl of Caithness]

My Lords, I do not anticipate a police station—

[Lord O'Neill of Clackmannan]

A polling station.

[The Earl of Caithness]

In fact, I do not anticipate people living there. But what is important are the oil exploration rights around Rockall, which have huge implications. What I want to ask my noble and learned friend is what takes preference. Is it Her Majesty’s instructions to raise a union flag and it is taken for the union, or is it an Act of Parliament which gives administrative rights so that the island of Rockall is part of Scotland? That ought to be decided. I would say to the noble Lord, Lord O’Neill, that these are the sorts of issues that we need to be clear about when it comes to the referendum. If oil is found within the waters of Rockall, let us have a clear mandate as to who owns it and who is going to have responsibility for those areas, and indeed defend them against attack, perhaps by terrorists, if the oil is developed.

My last amendment in this group is to Amendment 94C, another amendment tabled by the noble Lord, Lord Foulkes of Cumnock. It concerns the second question about the fiscal autonomy of Scotland, for which I know he did not get much support. I want to ask my noble and learned friend what the situation would be should Scotland vote to become a separate country from the United Kingdom. My amendment provides that Scotland should no longer be allowed to use the British pound sterling. I do not see how Scotland could use the same currency as England if it did not have a common Government. That has been the problem with the euro. My noble friend Lord Forsyth has argued strongly that we should not join the euro. Attempts have been made by many politicians, including the present Chief Secretary to the Treasury, to get us to become part of the euro and much more integrated. However, the decision not to become part of the euro has clearly been vindicated. In the event of Scotland becoming a separate country and not having the same Government, it would be quite detrimental both to the remainder of the United Kingdom and to Scotland to have the same currency. It has not worked in the past and it will not work in the future. I would like my noble and learned friend to confirm that Scotland would not be allowed to use the British pound sterling.

That would not be something sensational for Scotland to do because in the days of King David I, somewhere between 1140 and 1150, the weights and measures and the currency of Scotland were based by Act of Parliament in Caithness. It was decreed that there should be a common and even weight for the pondus Cathaniae, so it would be quite simple for Scotland to go back to that.

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[Lord Browne of Ladyton]

Clearly it could be done by the Summer Recess, and that would be my preference. It would be contradictory to issue a consultation document and argue for the resolution of this issue as soon as reasonably practicable and then put practical blocks on that being done because we cannot get through the process here. We in this Parliament have all had experience of dealing with things in an emergency. In the context of Northern Ireland, for example, in order to maintain momentum in the peace process or to respond to circumstances, we have taken legislation through each House in one day. So if there is a will there is a way, and there ought to be a will because this is the most important question that the people of Scotland have ever been asked—or at least since 1707—and, as we have heard repeatedly from noble Lords, it has serious implications for other parts of the United Kingdom. People have lots of investment in this. The Government should treat this as a priority and find a way forward. We have stuck to a timetable that is associated with the consultation that the Scottish Government have issued, and to respect them we must observe that timetable. Beyond that, though, we need to move as quickly as possible.

With regard to the noble Earl’s three or four amendments, I think we were all interested in the history lesson that we had about the islands of Orkney and Shetland, the observations about Rockall and indeed the argument about a complementary referendum for the United Kingdom after the Scottish people have had their say, if they determine to leave the United Kingdom. Like other attempts to amend the Bill, the complementary referendum falls down on the next question, which is: if the Scottish people decide to leave and the rest of the United Kingdom wants to keep them, how do you keep them in the United Kingdom? Unless you were going to ask that question, why would you hold the complementary referendum? I listened to my noble friend Lord Reid explaining the necessity for dealing with these issues in series. Many of us who have been in this debate consistently had got to that point a while ago. I read in some of the responses to the consultation attempts to explain this by analogy, but the best analogy that I have heard for this is that if you are a member of a club and you choose to leave, that is a decision for you, but if you are a member of a club and you want to change the rules, that is a decision for all the members of the club. That seems to be common sense. The analogy belongs to Sir Malcolm Rifkind, by the way; maybe he got it from someone else, but he said it to me and I thought, “That’s exactly the position”.

Consulting all the other members of the club about changing the rules, if that is what we choose to do in future, will be a complicated and difficult process because there is a lot to be done if we enact the Bill. First of all, we have to work out the exact implications of what we have already devolved to the Scottish Parliament. We have learnt a lot in this Committee about Clause 28, which is quite substantial devolution. We have to persuade those people who are good at making up phrases to describe what they want and what it means—they had their opportunity with Calman to come forward and explain what all that meant, and precious few of them appeared—and then find some mechanism beyond the separate party mechanisms of finding an inclusive, all-party process of measuring whether all this is in the best interests of Scotland and the rest of the United Kingdom. Then perhaps we can decide how we are going to ask for approval from the people of the country for that deal if we come to some recommendation. That, however, is a process for another day; it cannot be done in the context of this Bill.

I shall deal with the noble Earl’s other two amendments about the islands. My suspicion was that what lay behind those amendments was oil, which was perhaps doing a disservice to the noble Earl as I listened to him explaining the history of the islands and his knowledge of the island of Rockall and how it was claimed for the United Kingdom. He was quite candid about the issue towards the end of his remarks. I say to him that if that is the intention of any person in relation the Bill, that is not a game that people on these Benches will play. The challenge that we face is to persuade the people of Scotland to stay in the United Kingdom for good, positive future reasons. If we cannot meet that challenge, I will be no part of telling the voters of Scotland that if they vote for independence the UK will take away their oil. Starting down that line would be utterly counterproductive.

I must caution the noble Earl. Whatever the underlying motivation may be for these amendments—respecting the wishes of the people of the high north with regard to the United Kingdom, or the history of the island of Rockall, which is much more chequered and less specific than it first appeared—now that he has linked this issue to oil, I ask him please not to repeat these arguments in Scotland, as they will damage our ability to keep the union together.

[The Earl of Caithness]

That was not my argument. I was responding to an intervention by the noble Lord, Lord O’Neill. My argument was not about oil. That was not my intention at all, particularly with regard to the Orkney and Shetland amendments. As for Rockall, I just wanted to know what the legal position is.

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[Lord Steel of Aikwood]

My Lords, I think this amendment has been overtaken by events. The Minister has made it clear that the referendum will be administered by the Electoral Commission and, therefore, there is no need for me to labour the point. That is very important. The First Minister of Scotland still has to recognise one thing: as he has a particular objective in mind in holding the referendum, he is not the right person to declare what the question should be. Any member of the public would accept that that proposition is correct. You cannot say, “The people must determine this, but I will tell them how to determine it”. In my Amendment 93 to the noble Lord’s Amendment 91, I have suggested that it should be by agreement and that the Scottish Parliament should be consulted and be party to how the question is drafted.

Equally, I disagree with the noble Lord—although I think a moment ago he almost resiled from certain wording—that we should lay down the question. I missed the earlier debate for which I apologise, but the noble Lord, Lord St John, and I had a longstanding appointment with the Prime Minister of Zimbabwe, Mr Morgan Tsvangirai. If you think we have problems in our coalition, you should hear his. I missed the substantive debate on the referendum earlier.

I think it is also important that the people of Scotland are beginning to get scunnered—if I may use a good Scottish word—by the endless argument from politicians, academics and economists about the process and what might or might not happen if Scotland became independent. This cannot go on for another three years. It is ridiculous.

Therefore the part of the amendment that I support is the suggestion that the time should be now. If not immediately, then certainly as soon as possible, we should get this issue out of the way. As soon as we get clear of the independence referendum, we can start, as the Prime Minister has said, serious discussion about how we can add to the devolution package, and that is very sensible.

We have got the Electoral Commission in the frame, so there is no need to press that. Choosing the question should also be a matter for the Electoral Commission, and I agree with the noble Lord, Lord McConnell, who has made this point before, that rather than having a yes or no and putting some people in a negative position, there should be two propositions from which people choose either to remain in the United Kingdom or to go independent.

If that is done, and done quickly, then we can get this issue out of the way and the Scottish Government should concentrate on what they were elected to do, which is to deal with the issues affecting Scotland at the moment: bad housing, unemployment, and the need for more investment in industry. These are the things people want. They do not want three years of argument about a referendum. They want to see a Government tackling the issues, both in Scotland by the Scottish Government, and in the United Kingdom by the UK Government. The sooner we get back to that realistic level of politics, the better.

[The Earl of Caithness]

My Lords, my Amendment 94E takes what my noble friend Lord Steel said a little bit further, and asks that the Electoral Commission set the question. It is quite clear that nothing the UK Government propose is going to be accepted by the Scottish Government, and nothing that the Scottish Government propose will be accepted by the UK Government.

Why not cut the politicians out? Let us ask the Electoral Commission not only to set the questions but to arrange all the counting, transferring the number of votes into a proper result that is based, exactly the same way the referendums were in 1979 and 1997, on each local authority area, rather than just Scotland. We would know that there would be a clear question—or questions, if we go down the route proposed by the noble Lord, Lord McConnell—but also that each area voted and how they voted, and that it was a fair process.

Taken out of the hands of politicians, it will not only be more acceptable to the people of Scotland, but in view of our earlier discussions, I think it would be more acceptable to the rest of the UK, who would feel that an independent authority is doing this rather than politicians.

[Lord Selsdon]

My Lords, I will speak to Amendment 96, if I am in order. I feel that because of my voice, I should give a brief introduction. My name is Malcolm McEacharn Mitchell-Thomson, and I carry the burden of being Lord Selsdon, which is actually registered in Scotland. I am also a Scottish Baronet. But on the business of one’s past and the Scottish relationship, I ask: who is a Scot, and where or what is a Scot?

As noble Lords know, 5 million Scots live in Scotland, 400,000 or more live in England, and 40 million around the world. If we are to move towards having a referendum, I for one would like to be able to vote for the first time in my life—because by accident of birth, I have never had a vote—in a referendum. I have reason to believe there are many others in the world who will claim they are Scots who would like to be consulted in one form or another. This is why I tabled my amendment on Burns Night, and it was well received by many of the Burns associations.

It is a very difficult matter. If we do not consult, many people who are not in Scotland will feel that they have been ignored. My amendment draws attention to us. In this House, by accident or by recent legislation, we are deemed to be resident, ordinarily resident and domiciled in the United Kingdom. What happens to us if the referendum goes through and there is devolution? Are we still domiciled in the United Kingdom? Domiciled is an interesting concept. As an ex-banker, I know that there is no way I can be anything other than domiciled in Scotland. The reason is that, as your Lordships know, you take the domicile of your father at birth, which is your domicile of origin. Unless you physically and emotionally make a move to change that domicile to a domicile of choice, your domicile remains your domicile of origin. It passes through the male line if you do not change it. Therefore, there could be more people outside Scotland who have the right to vote than there are in Scotland.

I personally am hooked there—line and sinker. I have not got rid of any property in Scotland. You have to cut off all your links and sell your properties and perhaps resign from your clubs. I have the advantage or disadvantage of having a lair. When you reach the age of 50, you receive from some smart Writer to the Signet a brown envelope containing your lair certificate. I did not know that a lair was a plot. I did not know also that as my family is international—my great grandfather was Provost of Edinburgh and my great-great-grandfather was the first Lord Mayor of Melbourne; my family fled Scotland to earn some money and were the biggest coal people in Canada, so I am spread and twisted across the world—I have two lairs, although there is only one of me. Furthermore, the McEacharn family has a mausoleum in Galloway. When I visited it, I was asked to make a contribution, although the stipend was originally drawn up at the turn of the century. The agreement was that we would effectively allow them to keep the motor mower and gardening equipment in there because there was plenty of room and we no longer had the same number of children as we had had in the past.

My point is simple. However the referendum is constructed, there should be some consultation among the Scottish community around the world to see what their views are. I believe that they are unionist at heart. It is not difficult to identify them because through the Burns society you can identify any Scot in the world, including those who like to pretend that they are Scots. One of the greatest benefits of Scotland is that relationship: the power and influence of Scots throughout the world. It is a Foreign Office that costs them money. It is also a relationship that brings interchanges, and one is pleased at the moment that there are more students coming to Scotland than there were. The dogs have not yet arrived, but more people wish to come there. So Scotland can prosper. It is not a question of coastline or anything like that; it is a question of attitude. Will the Government find some consultation formula that will allow us to consult Scots worldwide?

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[Lord Wallace of Tankerness]

From the reaction that the noble Baroness has had to that comment, it is clearly one that resonates across the House. I do not pretend that I have an answer to it, but she asked me to reflect on it and we certainly shall. I am not sure if it is practical but she makes an important point well, and it strikes a chord in the House.

I was going to make the point that I in no way underestimate the importance of the franchise, but it does not disqualify people from participation in the debate or the referendum. When the real debate comes, I sincerely hope that we will get contributions from other parts of the UK that have a view to express about how much they value our United Kingdom. I very much hope that Scots from the diaspora will express their views—maybe some that I do not agree with, but I am sure there will be many that I do—about how valuable over many years they and their families have found Scotland being part of the UK.

We believe that we should try to ensure consistency and transparency, which is why we have indicated our preference for a franchise based on the present one for the Scottish Parliament and local government. We will continue to seek agreement on that basis. With those assurances, I invite the noble Lord to withdraw his amendment.

[The Earl of Caithness]

My Lords, I am grateful for what the Minister said in reply to my amendment, which a number of noble Lords supported. I just wonder whether his mind is totally closed on the issue of allowing the Electoral Commission to set the question. A lot of us are still quite concerned about a Section 30 fudge on which we will have no say except a possible debate. A question could be negotiated behind closed doors in order to satisfy the Scottish Government, rather like the agreement over the past few days to which we were not party. We would have the same situation with a Section 30 order, and we would then have a question that we were not totally content with. Perhaps to avoid that situation, the Electoral Commission might be allowed to set the question. I know that the Minister had reservations about that but I hope that his mind is still open to being persuaded at a future time.

[Lord Wallace of Tankerness]

I hear what my noble friend says, but I ask him to reflect him on two points. First, it is my understanding that the Electoral Commission would not necessarily welcome that. Secondly, with regard to the point I was making about the franchise: if one seeks to do something different, what are the rules regarding the relationship between the Electoral Commission and the question under the Political Parties, Elections and Referendums Act 2000? If you try to do something different for a Scottish independence referendum, you could immediately open yourself up to a charge of trying to rig or manipulate it. The advantages of consistency in this area are important.

I am told that the Electoral Commission has not, and does not wish to, set a question as its role is properly to review the question and publish that review, which is important. I do not countenance any situation where the commission would not be engaged, nor where its view on a question would not be made public.