Wales: Commission on Devolution in Wales

Lord Touhig Excerpts

Monday 18th November 2013 Lords Chamber

[Lord Thomas of Gresford (LD)]

My Lords—

[Lord Touhig (Lab)]

My Lords—

[Earl Attlee]

My Lords, we have not had a Lib Dem spokesman yet.

[Baroness Randerson]

I thank my noble friend for raising two new issues, the first relating to the question for the referendum. The Government’s response on this has laid great emphasis on how well we believe arrangements worked for the previous referendum on full legislative powers. In that case, the matter was very much in the hands of the Welsh Government and Welsh Assembly in consultation with the UK Government. However, there was a very important role for the Electoral Commission, whose advice was taken and was pivotal. I hope that the Welsh Government will lead the call for a referendum and that the situation in Wales will enable them to lead that call relatively soon. It is important that the Welsh Government feel that they are in a position strongly to call for a referendum, because the UK Government believe that the joint statement of October 2012 meant that there was agreement between the two Governments on the way in which future funding for Wales would be dealt with.

[Lord Touhig]

My Lords, the document accompanying the Statement states:

“The precise levels of capital borrowing will … depend on the outcome of the income tax referendum”.

Twenty years ago when I chaired Gwent finance committee, I borrowed £37 million from the European Investment Bank and paid it back on time. If a county council had such borrowing powers 20 years ago, why cannot the Welsh Government now be trusted to borrow to invest according to their own assessment of their ability to service that debt, rather than wait upon a referendum?

[Baroness Randerson]

The noble Lord makes an excellent point; I, too, was a councillor a long time ago. We should bear in the mind that councils raise a significant amount of funding via what we nowadays call council tax. Therefore, their level of borrowing depends on their level of tax receipts. The UK Treasury is proposing exactly the same model for the Welsh Government.