Wales Bill

Lord Anderson of Swansea Excerpts

Wednesday 15th October 2014 Lords Chamber

[Lord Anderson of Swansea (Lab)]

My Lords, my Amendment 59 has the same target as that of the amendment of the noble Lord, Lord Wigley, but approaches it in a different way. I ask that the tax reforms shall not come into force until a Welsh Government Minister has laid a report before the National Assembly containing a statement that the Welsh Government, with regard to the statement of funding policy, are content with the fairness of the allocation of funding arrangements from the UK Government to Wales. So this is effectively about fair funding, also known as the Barnett formula. I follow the noble Lord, Lord Wigley, in saying that in the current, somewhat depressed, economy, the gap has been narrowed. If there is positive economic development, that gap will be widened again.

The noble Lord, Lord Newby, asked us to be positive and not to be “moaning minnies”. I therefore turn to the front page of yesterday’s Western Mail, which quotes Shadow Welsh Secretary Owen Smith as saying after the discussions yesterday afternoon:

“I impressed on the Secretary of State the need for his Government to deliver fair funding for Wales”—

and here it is—

“and am pleased that he seemed prepared to address this issue”.

Well, if he is prepared to address it satisfactorily, I could sit down, I suppose. However, it is clearly a major issue in Wales.

Many years ago I sat at the feet of the noble Lord, Lord Morgan, who went on to become the vice-chancellor of Aberystwyth. He had come “al hoot” from Oxford and taught us poor undergraduates in Swansea new words such as “marginal”. He taught me about the great American labour leader Samuel Gompers, who was once asked, “What does American labour want?”. Some people expected him to suggest revolution or radical change. Samuel Gompers answered: “More”. If the grand public in north, south or mid-Wales were asked what they wanted, they would not enthuse about the proposed changes to landfill tax or income tax, or modified powers. They would say, “We want more”—because we are currently underfunded; the extent is uncertain, but we are certainly underfunded.

That was the position taken by the First Minister. I recall that immediately after the Scottish referendum he said something to the effect that Scotland has put the United Kingdom “through the grinder”—I think those were his words—and that the funding issue should now reappear: we should effectively shout more loudly. Scotland has been rewarded for it. Are we in Wales to continue to be taken for granted? We have played Mr Nice Guy and been ignored. Objectively, we have lost out financially.

Time is such that I will not detain the Committee, but I was impressed by an article by Alice Thomson in the Times of 24 September which—unusually, coming from a non-Welsh person—stated:

“While Scotland is being showered with largesse, Wales—failing and underfunded—has been pointedly ignored”.

She went on to give examples from Holtham:

“Last year under the Barnett formula, Scotland received £10,152 per head, while Wales, despite being much poorer, got £9,709. If Wales received the same levels of public spending per capita as Scotland, its public services would be boosted by £1.4 billion”.

Well, there may be argument about the exact amounts, but I cite what she says: Wales has been the orphan within the United Kingdom. She says:

“Wales is now barely acknowledged by politicians in Westminster … When I asked one English minister what the future held for Wales, he said: ‘Sheep and singing’”.

I hope that is not the attitude of other Ministers in this Government. I would ask noble Lords to read that article, which is very important.

It may well be that the shortfall could be remedied in other ways. I think it was the noble Lord, Lord Wigley, who mentioned a review of Severn Bridge funding. What is clear is that the Severn Bridge, with its substantial and increasing toll, is a major tax on Wales. There would be a big boost to the economy of Wales if that toll were to be removed. I would commend that to the Government. There may be other ways of making up that shortfall, but fair funding there should be.

I will end again on a positive note. I am encouraged by the way in which Owen Smith emerged from that conclave and said that he thought the Secretary of State was listening. Not just listening I hope, but ready to act.

--- Later in debate ---

Moved by

[Lord Anderson of Swansea]

57: Clause 29, page 31, line 18, leave out from end to “is” in line 25 and insert—
“(1A) Subject to the other provision made by this section, Parts 1, 2 and 3 come into force on such day as the National Assembly for Wales shall determine.
(1B) Parts 1, 2 and 3 may not come into force until the recommendations of a constitutional convention examining the distribution of power between Wales and the rest of the United Kingdom have been considered and voted upon by each House of Parliament.
( ) Subsection (1A)”

[Lord Anderson of Swansea]

My Lords, the last two amendments—and I hope I will not detain your Lordships too long—are in my name. They refer to the constitutional convention and the relevance of the Williams report: a report which is not mainly about the structure of local government but which contains important clauses on that. My contention would be that, just as we have looked at the relationship between the component parts of the United Kingdom, we should look also at the relationship between the Welsh Government and local government in Wales.

On the constitutional convention, there seems to be an increasing consensus that we need to look at the British constitution in the round. I fear that the response of the Minister would be: if you are so keen on your constitutional convention, why not put it in the manifesto for the next election when it can be debated? But that was Monday’s argument—since when, as we say, an amendment has been moved.

As an assiduous reader of the Western Mail I notice that, on the front page of yesterday’s paper, the Secretary of State, no less, is quoted as saying:

“Up to now, we’ve been saying, ‘Well, these are just matters for the individual parties and their manifestos at the next election’, but actually I think we can do better than that”.

Clearly, the noble Baroness appeared not to be on message on Monday; perhaps she will be a bit more on message today when she comes to respond.

So there is an increasing consensus. I hear the argument from time to time that to suggest a constitutional convention is no more than a device for delay and for kicking the matter into the long grass. The answer is that promises were made to Scotland—and some might argue that never has so much response been made by parties in the United Kingdom to one maverick opinion poll. When the Sunday Times YouGov poll suggested that there was a majority for independence, there was a certain panic among all parties, resulting in a response that may now be regretted at leisure.

The promises made to Scotland are clear and should be honoured, but they can be implemented on their own grounds. However, there are implications for the rest of the United Kingdom and, in my judgment, for the constitution—and I think that the Liberal Democrats have broadly been the leaders in this field. Clearly, the quasi-federal constitution needs to be viewed with all the difficulties that may arise. We need to have concern across the board, including in relation to your Lordships’ House. If there is to be a new regionalism, it should be reflected in the way that this House is elected, directly or indirectly—possibly, as in France, using the notables from local authorities. I think that the electorate of the French Senate is roughly 80,000. These are the people who are in the localities, the regional assemblies and the local authorities, and they come together having been elected indirectly to work together in the Senate. Your Lordships’ House should not be excluded from this consideration.

I think it was Alastair Campbell who said, “We don’t do religion”. That may or may not be the case but in the United Kingdom we don’t do constitutions—except for other people. We are pretty keen on delivering constitutions to colonial powers from high to low but we are not so good at doing it for ourselves. I have spoken to many groups from the Commonwealth Parliamentary Association and have been tempted to use the phrase “the Mother of Parliaments”, but clearly things are creaking in our own constitutional structures at the moment. Perhaps the 45% vote for independence in Scotland is a means of alerting us to the fact that the status quo cannot continue.

I recall Lord Weatherill, who was both a distinguished Speaker of the other place and the Convenor of the Cross-Bench Peers in this House, telling me a little story. He worked in the family firm of tailors and on his first day there was an old Jewish tailor to monitor him. One of the senior people came to the old Jewish tailor and said they wanted a suit made. He said, “Do you want it quick or do you want it good?”. There is an element of that in terms of constitutions. After all, we have agonised over changes for so long, going from precedent to precedent with a little tweak here and a little tweak there.

Now there must surely be a case for a group to make an initial analysis by looking at foreign examples and then for the elected representatives, so far as they are able, to take a considered view. It may be a federal system. Even within a federal system or a quasi-federal system one can have a range of very different powers. We know that in the different autonomía of Spain, for example, it is federalism à la carte. An autonomía such as Valencia has relatively limited powers, whereas Galicia and Catalonia have far more extensive powers—all within the same system. There is no reason why, according to demand, there should not be asymmetric devolution.

The key question is: are we happy to continue with constitutional tinkering or do we feel that we have reached the point where we need to look at the whole constitution from this place and the other place. I recall that one of the major cogent arguments used when we were discussing the future of this House was that there was no attempt to place it in the context of the relationship between this House and the House of Commons. We need to look at the devolved assemblies, and we also need to look at local authorities.

If we are not happy to continue tinkering, it is clearly right that we should now recognise that after the Scottish referendum we are in a new context, and that the status quo has proved insufficient. I recall that when the three party leaders made a vow, they came together quite properly. If they accept the case for a constitutional convention that is good although perhaps not quick, what is now stopping them? Is there not a reason for them to now make a similar vow on a consensual basis that this country deserves a constitutional convention?

I turn now to my second point, on which I shall be quite brief, which is the question of the Williams report. I submit that it would be wrong to ignore the position within Wales: that is, the relationship between the Assembly and the local authority. I recall that during the initial debates on devolution in the 1970s the Welsh Office, as it was then called, totally ignored local government. It was only at a fairly late stage of the debate that it was recognised and brought within the discussion that there were substantial implications for local government.

There is clearly a temptation for Cardiff Bay to hold on to what it has. However, I am encouraged by the response of the leader and, indeed, all the parties in the Assembly. Although the Williams commission hoped that there would be action by Easter of this year, we know that on 1 July the overview on broad public service recommendations was addressed, and on 8 July the local government reorganisation was addressed with a general White Paper. Now we are promised that on 28 November there will be a voluntary merger of local authorities. On 28 February there will be a White Paper setting out the process for merging councils that do not want to merge. There is already a timetable in process.

I will not labour the point that there is no ideal local government structure in Wales. I recall that many years ago when I was the Member for Monmouth there were certainly at least a dozen local authorities: rural district councils, urban district councils and town councils. That was done away with in the Walker reforms, with counties and districts. Clearly, it was right that the counties had responsibility for education and social services, but the divisions were not easily made.

We have now had further elements of reform. City regions are being considered. However, perhaps the failures over food safety are very good examples of the fact that, for certain areas of expertise, local authorities need to be able to employ experts in the field. I end on the plea that we do not forget local government. There appears to be a consensus within the Assembly on implementing the recommendations of the Williams commission, and the timetable is such that these could well be implemented before the provisions of the Wales Bill become law. I beg to move.

[Lord Thomas of Gresford (LD)]

My Lords, it is such a delight to hear from the noble Lord, Lord Anderson, who had a somewhat feckless youth when he was passionately anti-devolution. Clearly, somewhere between Monmouth and Swansea he was struck with the true light of liberal principle. As I understand his speech, he now supports not merely Liberal Democrat policy but also what was, in his feckless youth, Liberal policy.

[Lord Anderson of Swansea]

My position then was as it is now. Devolution within a unitary system is flawed in many respects, including the fact that there is no end position, whereas a federal or quasi-federal system with a constitutional court to adjudicate on the differences between the component parts is logical. We were embarking in the 1970s on a strange new journey and perhaps it was Mrs Thatcher, with her own form of centralisation, who was the major recruiting sergeant for me on that.

[Lord Thomas of Gresford]

The noble Lord, Lord Anderson, has disappointed me slightly with this recantation of what he said earlier, but never mind. I am entirely with him that we need a constitutional convention and that we should be looking for the abolition of the House of Lords and some form of federal, directly elected or proportionately elected Chamber that could consider the situation as a whole, perhaps with a Supreme Court charged with the sort of duties that attach to the Supreme Court in the United States. That is not, however, any reason for holding up the provisions of this Bill, which are urgent. The Bill needs to go through because Wales cannot wait for a future nirvana when we have got it all together, it is all very logical and all the problems are at an end. We cannot keep the Bill waiting for that moment.

--- Later in debate ---

[Lord Anderson of Swansea]

My Lords, the Minister vastly overstates her case by claiming that this Bill would lead to a truly accountable Welsh Government. If we look at this objectively, it is pretty small beer. It is a Wales (Miscellaneous Provisions) Bill. It was framed in a very different context from that which we have now, after the Scottish referendum. I assure her that the purpose of these two amendments—

[Baroness Randerson]

Is the noble Lord saying that a Bill that provides fiscal accountability for the very first time for the Welsh Assembly and Welsh Government is not a big step forward? Is he saying that the provision of borrowing powers for the first time for them is not also a big step forward? Does he not accept that the devolution settlement has been sadly lacking up to now because there has not been that proper accountability and that this is a vital development?

[Lord Anderson of Swansea]

I hear what the Minister says about accountability but given the relatively small changes and the small amount of money involved in these taxes which are to be transferred, I doubt that one can properly say that there is real accountability. There is considerable scepticism in the Assembly in relation to the tax powers, which may be stillborn in any event. Yes, I accept that borrowing powers are a major innovation in the Bill but these borrowing powers, albeit in diluted form, are available to local authorities in Wales in any event so why not to the National Assembly?

On the general point she made, my purpose in having this formula of,

“may not come into force until”,

was clearly only to provoke a debate. It was not intended as a freeze or delaying device. I accept that after the result of the Scottish referendum we cannot return to business as usual. Finally, I also accept the point made by my noble friend Lord Howarth that there are great problems in the concept of a constitutional convention. Even if we have the so-called constitutional experts, no doubt there will be minority opinions—as there have been on similar issues. It may be extremely difficult to find—as we saw in respect of reform of your Lordships’ House—any reasonable consensus following that.

Having provoked the debate that I set out to provoke by using the formula that, I say again, was not intended to freeze in any way the progress of the Wales (Miscellaneous Provisions) Bill, I will withdraw the amendment.

Amendment 57 withdrawn.