Wales Bill

Glyn Davies Excerpts

Tuesday 24th June 2014 Commons Chamber

[Owen Smith]

That is a tendentious and off-piste point, and I do not intend to busy the Chamber by bothering to respond to it.

We are still suspicious of the Government’s motives, not least because the leader of the Conservative party in Wales, Andrew R.T. Davies, has said explicitly that he wants to cut taxes for the wealthiest people in Wales. That is what we suspect that the Tory party would do if, heaven forfend, it were ever to assume power in Wales. We also still have suspicions that the Government are not really serious about doing this for Wales; in truth, we feel that it is more evidence that Wales is of interest to them only as a stick with which to try to beat the wider Labour party. We have heard this on health, on housing, and on education. Again, their perspective is to try to drive wedges into gaps that do not exist.

If the Government were serious about this, they would have undertaken some of the work that they have done in Scotland. When we last met here to debate this Bill on 6 May, we were anticipating a report by the Government—in fact, it was late by then—on the costs of implementing a similar scheme in Scotland. It did not come out on 30 March, as promised, but on 6 May—on the day, slightly unfortunately, of our debate. The report is entitled “Second Annual Report on the Implementation and Operation of Part 3 (Financial Provisions) of the Scotland Act 2012”. It contains welcome news, because it concludes that the total cost for Scotland will not be the £40 million to £45 million originally anticipated, but a mere £35 million to £40 million. That is what it will cost not Her Majesty’s Government but the Scottish Government to implement a separate Scottish tax regime.

One would have thought that if the Government were serious about implementing this, the cost to Wales should be measured, but the Treasury and the Wales Office have undertaken no such analysis. That is particularly troubling because of the point made by my hon. Friend the Member for Alyn and Deeside (Mark Tami), who is no longer in his seat. There is more complexity in implementing this scheme in Wales because of the greater population density on the border between England and Wales—on either side of Offa’s Dyke, or the line between life and death, as the Prime Minister refers to it. Just 4% of the Scottish population and 0.5% of the English population live within 25 miles of the Scottish border, whereas 48% of the Welsh population and fully 10% of the English population live within 25 miles of the Welsh border.

In Scotland, such measures would potentially affect just 450,000 people who travel back and forth across the border, whereas in Wales the number is likely to be closer to 6.5 million. The implementation costs for Wales are therefore likely to be greater, if not the volume of communication that the Government will have to undertake. Were they serious about this, we might have heard some analysis from them today, but we have heard not a jot.

[Glyn Davies (Montgomeryshire) (Con)]

I would like some clarity about the Opposition’s position. We are being told that they will vote in favour of the Bill, which is very good news, but the whole discussion on income tax devolution to Wales suggests that they are completely against it. There will inevitably be differences—we know that the border areas are more difficult in Wales than in Scotland—but the Opposition’s entire rhetoric suggests that they are against the devolution of financial accountability to Wales.

[Owen Smith]

I say again that we will support these measures. We will not press amendments 10 and 11 to a vote because we see value in greater accountability and, in particular, in the borrowing powers that are associated with income tax and other taxes. Nevertheless, there are all sorts of reasonable questions to be asked about the impact on the hon. Gentleman’s constituents and mine. The Government are being remiss, if not incompetent, in failing to deal with those questions and failing to come to this House with a proper explanation of what they think the impact will be, as opposed to using the issue merely as a stick with which to beat Labour.

--- Later in debate ---

[Glyn Davies]

I am grateful for being called to speak on an issue that is of great personal interest. As well as being the Member of Parliament for the Welsh seat of Montgomeryshire, I served for eight years representing Mid and West Wales as a regional Member of the National Assembly for Wales. My dominant interests since becoming a Member of Parliament have been Welsh politics, the Welsh economy, Welsh public services and, indeed, the relationship between Cardiff Bay and Westminster as they deal with the devolution process, which will continue for many more years. The nature of such a process is that one does not reach an end stage, a point to which I shall return.

I do not think this a dry debate at all. Constitutional debates tend not to be ones about which we joke and laugh, but as someone who is deeply embedded in Welsh politics, I find a debate about a Bill concerning the future governance of my country hugely interesting, and I have enjoyed the various aspects of it.

I declare my enthusiastic support for the Bill, which is a significant step forward in the devolution process, although there are aspects with which I do not agree. Perhaps I am in a very small minority, but I should refer to those differences alongside my general support for the Bill, to put my opinions on the record for the benefit of anyone in my constituency and indeed the rest of Wales who might want to know what they are.

I have listened to some of the debate; I missed some of it owing to meetings. My general impression is that Labour’s position in particular is confused. Clearly, Members on this side of the House are pleased that Labour will be supporting the Bill—that is a positive move—but the contributions of many Labour Members suggest that they just do not accept the principle underlying the devolution of tax to the Welsh Assembly. Some of their language has sounded more as though they oppose the Bill than support of it.

The Plaid Cymru contributions have been churlish—that is the word that I would use. During this Parliament it was a Conservative Secretary of State who introduced, with very great determination, the Bill that created law-making powers in Wales. I do not believe that it would have been introduced if it had not been a Conservative Secretary of State; I think that a Labour Secretary of State would probably have chickened out. It was a Conservative Secretary of State who established the Silk commission. It has done very good work and, like several other Members, I commend it for that work. It is a Conservative Secretary of State who has introduced this Bill. I perfectly accept that it does not go as far as Plaid Cymru Members may want—one would not expect that—and, indeed, there are differing views on the detail of the Bill in all parties, but nobody can disagree that granting tax-raising powers to the National Assembly for Wales, and the borrowing powers that go with them, is anything but a huge constitutional step forward. On that basis, it might have been at least fair of Plaid Cymru to congratulate the Conservative party on taking us down the road, not as far as it would want, but certainly in a positive direction.

[Mr Llwyd]

The hon. Gentleman said that he had been in and out of the debate, and I accept that—so have I. My colleagues were generous about various parts of the Bill, but nevertheless there are parts about which we are concerned, and that is the nature of politics. Do not call us churlish because we find fault in some way with the Bill. That is just politics, is it not?

[Glyn Davies]

I thank my friend for that; he has been a friend for a long time. It is reassuring that he has decided to intervene and say how supportive he is of what the Conservative Government have delivered in the past few years. I shall read today’s debate in Hansard to pick out all those individual bits that he speaks so enthusiastically about.

There are several elements to the Bill, the most important one by a long way being the tax-raising powers and the commensurate borrowing powers that go with them. There will be continuing debate on that. It may well feature in the manifestos of the various parties leading up to the next general election, and I think it will be revisited in the next Parliament. That is natural in constitutional issues when there is a process. I think there will be a next step to this process, which I look forward to being a part of after the next general election.

Another issue that has caused a lot of excitement is dual candidacy. If there was any political intent to gerrymander, it was on the part of the Labour party when it introduced the ban. No independent body in Wales, including the Electoral Commission, thinks that it is any way partisan to scrap the ban on dual candidacy. It was brought in by the Labour Government in this place with the support of Labour in Cardiff, with the view that it would benefit the Labour party in Wales, and it is truly ironic that it did not. The Opposition should welcome what is a right and proper constitutional change brought in by this Government.

I am not in favour of a referendum; generally speaking, I do not like them. Political parties should tell the people what they intend to do and if the people vote for them at a general election, they can carry that out without a referendum. I accept that I am in a minority in relation to a referendum on tax-raising powers in Wales. The Silk commission recommended it and there was a referendum in Scotland. Apart from this one contribution on this issue, I will have to sneak back into my box rather quietly on that one.

I am also not in favour of a five-year term, and again I might be in a minority. I generally think that four-year terms are right for Parliaments. We have a five-year term here, and I realise that there is a lot of support for a five-year term for the National Assembly. Again, that is another little box that I will have to crawl back into, because that might be a minority view.

But let us not forget what the Bill will do if, as I hope it will, it receives its Third Reading today. This Westminster Parliament is granting to the National Assembly for Wales the power to raise taxes—financial accountability, so that in future a Welsh Government will be accountable to the people whom they represent. There is further to go, but there is an important principle: that a Bill put forward by a Conservative Secretary of State is making a significant contribution to the process of devolution in Wales.

[Paul Murphy]

It is a great privilege to speak on Third Reading of a Bill that my hon. Friend the Member for Pontypridd (Owen Smith) indicated we will not oppose, for a variety of reasons. The Secretary of State referred to this as a milestone Bill. I have sat through 26 years of Welsh Bills, and I have to say that I do not think this is a milestone. There are some good parts to it, but a real milestone was the Bill introduced by the Labour Government after the 1997 general elections, which set up the Welsh Assembly.

The hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) suggested in a previous debate that the Westminster parties, by which I assume he meant the Conservatives, Labour and the Liberal Democrats—he is actually a member of a Westminster party, as we meet here in Westminster, rather than Dudley or anywhere else—were obstructive when dealing with devolution matters. Had he said that in 1978, he would have been absolutely right. I was treasurer of the “No Assembly” campaign in Wales and deeply opposed devolution in the late ’70s, but I changed my mind, and for a variety of reasons, including all those years of Conservative government. He and his Plaid Cymru colleagues must reflect on this: no Labour Government would have meant no Assembly and no Welsh Government. Obviously we were helped by the pro-devolution parties—the Liberal Democrats and his party.

The hon. Member for Montgomeryshire (Glyn Davies) suggested that a Labour Secretary of State might have “chickened out” of extending the Assembly’s powers. I see no evidence for that, having been a Secretary of State for Wales twice. I certainly would not have chickened out. Indeed, when this Bill was introduced I enthusiastically supported the previous Secretary of State, who I thought showed great courage in introducing it as a Conservative, and I agreed with her.

[Glyn Davies]

I would like to reassure the right hon. Gentleman that I do not think the Labour party would have chickened out had he been Secretary of State.

[Paul Murphy]

I am grateful to the hon. Gentleman for that.

The devolution of extra powers was supported overwhelmingly by the people of Wales in the referendum, including in my constituency, which, having been one of the most sceptical and anti-devolution constituencies in the whole of Wales, changed its mind. I think that there has been a sea shift in how people perceive devolution. People understand it more, although not completely. We heard earlier about the Welsh television surveys indicating that many people did not know who ran the health service, for example. There will still be some of that, but there has been a change none the less.

To that extent, I welcome aspects of the Bill. The change to the name “Welsh Government” might seem trivial to many people, but it is significant. I think that the fixed terms, the ban on dual membership and other aspects of the Bill are greatly to be welcomed. Even though we disagree on how the business of taxation should be introduced in Wales, the fact that the Government have introduced the idea that we should deal with it is significant. All parties now agree on that, even if we disagree on the method and mechanism by which it will be introduced. However, there are parts of the Bill, including dual candidacy, on which we fundamentally disagree with the Government. There are substantial disagreements, but there are also agreements.

The Bill will now go to the other place, and I think that there is an opportunity for their lordships to improve it. I will refer to just two issues. One relates to reserved powers, which I spoke about earlier. I think that the Scottish referendum—I hope that there will be a no vote—will be followed by extra powers for the Scottish Parliament and that that will be replicated in our Assembly in Cardiff. I hope that the Government will rethink that.

More immediately significant is the issue of borrowing. I think that we are being short-changed in Wales as a result of this Bill. I agree wholeheartedly with the Government that the Welsh Government should be able to borrow, as the Northern Ireland Executive and the Scottish Government can, but I have still heard no reasonable answer to the question that all of us on the Opposition Benches have posed. The borrowing principle was introduced in Edinburgh and Belfast without necessarily any reference to streams of income, even though Scotland theoretically has a stream of income and the Northern Ireland Assembly has dealt with rates for many years. There is a gaping hole there. I think that their lordships would be well advised to examine that issue in the Bill.

--- Later in debate ---

[Mr Mark Williams]

I could not possibly comment, but I will give way to him.

[Glyn Davies]

I would just like to say that the late, great Baron Hooson was a wonderful Member of Parliament who served Montgomeryshire and Wales with distinction for many, many decades; I do not want to be accused of being churlish.

[Mr Mark Williams]

My hon. Friend says that with great sincerity, and I know him to be a sincere man. I just wish to place on the record the fact that the process of devolution has been an achievement of politicians of all parties—Liberals, Conservatives, and friends from the nationalists and from the Labour party—over the years. That process of consensus has to continue if the process of devolution marches on.