Wales Bill

Glyn Davies Excerpts

Wednesday 10th December 2014 Commons Chamber

[Owen Smith]

My hon. Friend reinforces my point. We know that the Welsh economy has historic weaknesses because of the decline in heavy industry, and its distance from London and the powerhouse of the south-east. Those are well understood, but they are not reflected in the debate that we are having, which is largely politically motivated.

Some in Wales argue that we do not need a referendum to decide this matter, but we think that the Welsh people should have a debate and ultimately take the decision on what would be a radical change. The debate cannot be driven by the Tory party’s desire to insulate itself against the charge that it has reduced Welsh budgets by 10%, which it has; or by the need to support the Tory objective of reducing public spending to levels we have not seen since the 1930s, as was manifest last week; or even by the wish to sustain a partisan argument of English votes for English laws. All three of those rationales feature as part of the Government’s motivation for this debate, and we are disappointed that they have not provided any real response to these questions throughout the passage of the Bill.

It will now be for the Welsh Labour Government to consider what is best for the Welsh people. I have no doubt that they will do so using Welsh Labour values and thinking about the benefits for the Welsh people, as well as about how we deliver equality and improvements to the lot of working people across the UK.

[Glyn Davies (Montgomeryshire) (Con)]

I am grateful for the opportunity to speak on the occasion of the Bill’s return from the House of Lords in much improved form, if I may say so. In general, I welcome the Bill although I am concerned about some elements. Perhaps it is a Welsh trait that we can never completely agree on things, and I want to touch on one issue where I am not in agreement.

What I welcome in particular is the new reality of the Conservative and Liberal Democrat coalition shaping the process and future of devolution and driving forward, leaving—if I may say so to the shadow Secretary of State—Labour languishing in its wake. He may describe that as a U-turn, but that is the reality today. I want to make just one important point, which is very much a personal view. I disagree with one specific aspect of the Bill, but I would like to emphasise my overall support: it is a very good and welcome Bill.

I would like to put my point in context by painting some background to my personal journey in the devolution debate. I was not in favour of the form of devolution on offer in the referendum on 18 September 1997. It seemed to me to be creating a permanently unstable constitutional settlement. A settlement is the last thing it was. I attended the count in Llandrindod Wells leisure centre, watching the TV coverage as the decision of the voters of Wales came through and they decided in favour of establishing a national assembly for Wales. I drove home knowing that there was no going back. The people had spoken, albeit by a tiny margin of 0.6%. We were now facing an entirely new question: how would devolution work in practice? I concluded immediately that the new Welsh Assembly would eventually become a law-making, tax-raising Parliament based in Wales. That has influenced my thinking on the issue ever since. I did not want to be dragged, kicking and screaming, and trying to refight the 1997 devolution referendum. I preferred to get ahead of the curve and identify where we were going to get to, and move towards that in a positive and smooth way. That was not a change of mind, but a recognition of a new reality.

[Jonathan Evans]

My hon. Friend, through his service in the Assembly, has been one of the individuals who has encapsulated the position adopted by the Conservative party. Although the party battled against establishing the Assembly in the first place, and although the margin was only 4,000 in a million, nobody could claim other than that my hon. Friend and the party in Wales have not been dragged back to the previous debate, but have moved forward and sought to make a success of the devolution settlement.

[Glyn Davies]

Nowhere has that been more obvious than in the contribution from those on the Front Bench when we started today’s debate.

The Government of Wales Act 2006, introduced by the Labour party, moved things forward quite a lot, as did the 2011 referendum in relation to tax-raising powers. The Wales Bill takes us further down the road to what I consider to be the inevitable conclusion, but not far enough for me on tax levying responsibility. I will be blunt about my view: it is a mistake that the Bill requires a referendum before devolving responsibility for levying part of income tax collection to the Welsh Government. That is properly an issue for a general election. The Welsh Government are not financially accountable to the people of Wales until they are responsible for levying a degree of income tax. It is also my personal view that financial accountability through responsibility for income tax is so fundamental to a proper, grown-up National Assembly for Wales and Welsh Government that we should not devolve extra responsibility until this principle is accepted—no financial accountability, no new powers.

The First Minister, and perhaps Labour Members here on the Opposition Benches, do not want financial accountability. How convenient it is to bask in the credit of every spend that the people of Wales approve of and blame the UK Government for every difficult decision needed to bring order to the United Kingdom’s finances. We see the First Minister in Wales scrabbling around for any reason he can come up with to avoid committing to a referendum. First, it was lockstep, which is removed by the Bill. Then it was the Barnett deficit, until it became clear that it is a rather smaller Barnett deficit than we thought. I hear now that air passenger duty might be another reason, and if that is resolved, there will be another one. The reality is that Welsh Labour in Cardiff is desperate to avoid financial accountability. It does not want to be properly financially accountable to the Welsh people.

[Mr Elfyn Llwyd (Dwyfor Meirionnydd) (PC)]

I am following the hon. Gentleman’s argument and thinking about what the Labour spokesman said. When the Silk proposals were being discussed, the First Minister of Wales was adamant he did not want air passenger duty devolved, but suddenly he has woken up and is desperately keen on it. It depends what day of the week we are in.

[Glyn Davies]

I would be more encouraged if I thought the day of the week was the reason. I think it is a desperate attempt to find one more hurdle to prevent us from moving towards financial accountability.

During the passage of the Bill, I accepted it would include a commitment to a referendum on devolution of income tax levying powers. It was a recommendation of the all-party Silk commission, and in 1997 there was a referendum on this issue in Scotland. In my view, however, the Silk commission was wrong, and weak in its recommendation on this point. Devolving income tax powers is not as big a change as is being made out, and it is entirely appropriate that it be decided at a general election; it does not need a referendum. If a Welsh Labour Government acted irresponsibly, which they might well do, they would quickly be turfed out of office. It is much easier to sit in blissful impotence, complaining.

I would like to see manifesto commitments by my party, the Liberal Democrats and Plaid Cymru to revisit this issue, perhaps in a Wales Bill early next Parliament and before the Assembly elections in 2016, and to devolve income tax. We should put an end to Labour’s easy ride in Wales and make the Welsh Government properly fiscally accountable to the Welsh people. Only then will devolution grow up and reach its inevitable, logical conclusion.

[Jonathan Edwards]

It is a pleasure to make a short contribution to this debate, primarily to welcome these Lords amendments, which mirror amendments that were tabled by Plaid Cymru when the Bill passed through the Commons and which conveniently the three Westminster parties voted against at the time—they say a week is a long time in politics, but we are only a few months down the line and there has been a complete change of position. In that regard, I congratulate the new Secretary of State on being far more progressive than his predecessor.

--- Later in debate ---

[Alun Cairns]

I am not sure where this is going, but I accept that the engagement of young people is exceptionally important. The purpose of this Lords amendment is to devolve the power for the referendum to the Welsh Assembly, and it can therefore make judgments accordingly.

[Glyn Davies]

I questioned the need for a referendum. Although we accept that it is part of the Bill, does the Minister think there may be a possibility at some future stage of getting to a position where we can proceed with this income tax raising power, despite Labour’s opposition, by including it in a general election manifesto and not having a referendum?

[Alun Cairns]

I am grateful to my hon. Friend for that, and I pay tribute to him for his speech. The debate on devolution is moving quickly and the referendum in Scotland has changed the debate across the whole of the UK. It is up to each political party to make its judgment. It is almost certain that there will be a Wales Bill in the next Parliament, whoever is in government. There will be an opportunity for him to make the case at that stage, and for each political party to make the case leading up to the election and include an element relating to that in its manifesto.