Scottish Parliament (Hansard, 24 July 1997)

HL Deb 24 July 1997 vol 581 cc1526-44 1526

§ 4.18 p.m.

§ The Parliamentary Under-Secretary of State, Scottish Office (Lord Sewel)
My Lords, with the leave of the House, I shall repeat a Statement on the Government's proposals for a Scottish parliament which is being made in another place by my right honourable friend the Secretary of State for Scotland. The Statement is as follows:
"With permission, Madam Speaker, I should like to make a Statement about our plans for the Scottish parliament. Copies of this Statement and the White Paper are now available in the Vote Office.
"On 1st May, the people of Scotland—like the people of the United Kingdom as a whole—voted for our manifesto and the comprehensive programme of constitutional change. At its heart was our commitment to create a Scottish parliament and a Welsh assembly giving the people of Scotland and Wales more control over their own affairs within the United Kingdom.
"Our aim is to make government more open, more accessible and more accountable to the people whom we serve, and to give the United Kingdom a modern constitution fit for the 21st century.
"The Government are losing no time in turning these commitments into reality. On Tuesday, my right honourable friend the Secretary of State for Wales published his plans for devolution to Wales. Today I am laying before the House the detailed proposals for the Scottish parliament.
"Like many others in this House and beyond, I have campaigned long and hard for a Scottish parliament over the years. Few occasions in my long parliamentary career have given me as much pleasure as coming here today to present our firm proposals for that Scottish parliament.
"In my time I have seen many devolution schemes. I genuinely believe this is the best; and right for Scotland. We have renewed, modernised and improved on the plans agreed with the broad coalition of Scottish interests in the Scottish Constitutional Convention. It will provide a new, stable settlement which will serve Scotland and the United Kingdom well in the years to come.
1527 "Let me outline what we propose. The Scottish parliament will have the power to make the law of Scotland in devolved areas. Entrusting Scotland with control over her own domestic affairs will better allow the people of Scotland to benefit from and contribute to the unity of the United Kingdom. The Scottish parliament will hold to account an executive headed by a First Minister which will operate in a way similar to the United Kingdom Government. Together, the Scottish parliament and executive will be responsible for the wide range of domestic matters which affect everyone living in Scotland, including: health; education and training; local government; housing; social work; economic development; transport; the law and home affairs; the environment, including the natural and built heritage; agriculture, fisheries and forestry; and sport and the arts. The details are there in the White Paper.
"A key aspect of the Scottish parliament's role will be to create and maintain an effective oversight of other Scottish bodies, the health service and particularly local government. We expect the Scottish parliament and executive to complement and not encroach upon democratically elected local government.
"Let me tell the House why this is an advance on any scheme that has gone before and why I believe not only the time is right but the scheme is right. The parliament will have extensive law-making powers. Unlike 1978, the full range of the Scottish Office's functions will be devolved. This will provide the opportunity to make a real difference in the areas that matter. The legislation will define reserved matters, not devolved matters, and the Scottish parliament will be able to exercise its law-making powers in all areas which are not specifically reserved to Westminster. The relationships between the Scottish executive, the UK Government and the Crown will provide clarity and stability for the future. The parliament will have the discipline and responsibility of defined financial powers. The Scottish executive will be closely involved with the UK Government in European decision-making.
"Throughout the White Paper our guiding principle is to trust the Scottish people to make the right decisions on their own behalf. The detailed procedures, the working arrangements and the practical issues relating to the governance of Scotland will properly be left to the parliament and the executive, answerable as they will be to the Scottish electorate.
"The UK Parliament is and will remain sovereign in all matters: but as part of our resolve to modernise the constitution, Westminster will be choosing to exercise that sovereignty by devolving legislative responsibility to the Scottish parliament without diminishing its own powers. Those matters more appropriately dealt with on a UK basis will remain at Westminster. They will include the constitution of the United Kingdom; foreign policy; defence and national security; the stability of the United Kingdom's fiscal, economic and monetary system; common markets for 1528 UK goods and services; employment legislation; some health issues, including abortion; social security matters; and most aspects of transport safety and regulation.
"After devolution, Scotland's MPs will continue to play a full and constructive role in the proceedings of this House. This is right both for Scotland and for the United Kingdom because devolution is about strengthening the United Kingdom.
"The distribution of seats is regularly reviewed by the Parliamentary Boundary Commissions which follows criteria defined in statute. At present, special statutory provisions stipulate a minimum number of Scottish seats. This has led to Members for constituencies in Scotland representing, on average, fewer constituents than Members in other parts of the United Kingdom.
"Our devolution proposals mean that, in practice, Westminster will no longer be the forum for scrutinising much of Scotland's domestic legislation. This brings into sharper focus the imbalance in the current arrangements. The Government have decided that the requirement for a minimum number of Scottish seats should no longer apply. Primary legislation will be needed. This will be put in place before the next full Boundary Commission review.
"Other statutory requirements such as the need to give due weight to geographical considerations and local ties will continue to apply. The actual number of seats allocated to Scotland will be for the Boundary Commission to recommend exercising its judgment in accordance with the criteria laid down.
"There will continue to be a Secretary of State for Scotland who will work with the new Scottish parliament and represent Scottish interests within the United Kingdom Government.
"The staff of the Scottish executive will continue to be part of a unified Home Civil Service. The Scottish executive and the UK Government will work closely together at ministerial and official level. The stability of the system is of the utmost importance. The White Paper sets out detailed arrangements for these working relationships; and for resolving any disagreements.
"The people of Scotland will continue to benefit from the influence which the United Kingdom has as a major state within the European Union. Relations with the EU will remain the responsibility of the UK Government, with the Scottish executive making an effective and appropriate contribution to UK decision-making on Europe. Ministers in the Scottish executive will have an opportunity to participate in relevant meetings of the Council of Ministers and in appropriate cases could speak for the United Kingdom.
"There will be a Scottish representative office in Brussels; this will complement the role of UKREP and will allow the Scottish executive to operate more effectively in Europe. The Scottish executive will have an obligation to implement EU legislation on devolved matters. Our proposals are very much in line with developments across the European Union.
1529 "The financial framework for the Scottish parliament will be based on the present "block and formula" arrangements for the Scottish Office, known as the Barnett formula, adapted to match the range of the Scottish executive's future responsibilities and to maintain and improve transparency and accountability. This will give the Scottish parliament the ability and freedom to approve spending decisions which are fully in accordance with Scottish needs and priorities.
"As an integral part of these financial arrangements, the control of local government expenditure, non-domestic rates and other local taxation will also be devolved to the Scottish parliament, with appropriate safeguards to protect all UK taxpayers. The Government's objective is to ensure that Scotland's spending decisions are taken in Scotland in the light of Scottish circumstances.
"Subject to the outcome of the referendum, the Scottish parliament will be given power to increase or decrease the basic rate of income tax set by the UK Parliament by up to 3p. The parliament will have a guaranteed right to raise or to forgo up to £450 million (index-linked) irrespective of changes to the UK income tax structure. Liability will be determined by residence in Scotland, according to Inland Revenue rules. The tax-varying power will not apply to income from savings and dividends. The Inland Revenue will administer any tax variation, with the Scottish parliament meeting the administrative costs.
"Let me now turn to the arrangements for the Scottish parliament itself. The Scottish parliament will consist of 129 members, 73 directly elected on a constituency basis, plus 56 additional members (seven from each of the current eight European parliamentary constituencies) allocated to ensure that the overall result more directly reflects the share of votes cast for each party. Eligibility to vote will be based on residency.
"In the late 1970s there was, without doubt, a fear that a Scottish parliament would be dominated by one point of view. The fear was that minorities, geographical or political, would be less than fairly represented. The changes in the electoral system now proposed have ended that possibility. The composition of the parliament will fairly reflect opinion throughout Scotland.
"The Government want to see people who represent the widest possible range of interests coming forward for election to the Scottish parliament. The aim must be equal opportunities for all—women, members of ethnic minority groups and disabled people. The selection of candidates is of course a matter for individual political parties, but others hopefully will follow our lead in encouraging women representatives.
"The Government are determined to have a parliament building worthy of the new century and ready to provide working conditions which will encourage open and accessible government. It is for that reason that a number of possible sites in Edinburgh, including the old Royal High School, are under consideration.
1530 "Subject to the passage of the referendums Bill, the people of Scotland will make their historic choice in the referendum on 11th September. Theirs is the judgment that matters. I believe that they will endorse our proposals. As soon as possible following that referendum result we shall introduce the legislation to establish a Scottish parliament. Once that legislation has been enacted we can look forward to elections in the first half of 1999. The Government's target is for the Scottish parliament to assume its full responsibilities in January in the year 2000. That indeed will be a new parliament for the new millennium.
"Now is the time for Scotland to choose. Twelve weeks ago Labour was elected on a promise to deliver a parliament for Scotland. This White Paper fulfils that promise. We have delivered. All the essentials are here—modernised and improved for the next century. This settlement offers an effective voice for Scotland. It recognises Scotland's distinctive identity and the strong ties which bind us together as one United Kingdom. Reform and renewal will give strength to an enduring partnership.
"I know, none better, the strength of feeling and the intensity of argument there has been on this subject over the years. Constitutional change requires good will. I believe there will be a broad welcome for our proposals which will reach out across party lines and across the range of our communities. It is my belief that it will be so. I commend the White Paper to the House."

§ My Lords, that concludes the Statement.

§ 4.36 p.m.

§ Lord Mackay of Ardbrecknish
My Lords, I start by thanking the Minister for repeating the Statement. I also thank him for giving me reasonable time to digest both the Statement and the White Paper. Although I am not the fastest reader on earth, I have managed to skip through the White Paper.
I am afraid that I cannot share the pleasure of the Secretary of State for Scotland in listening to the Statement that has just been repeated by the Minister. Rather than a day for rejoicing, I believe that this is a day of great sadness for our 300 year-old Union. I fear that this marks the beginning of what Tam Dalyell describes in his book as the end of Britain.
Every page and paragraph severs strand by strand the links that bind us in this island, just like a knife cutting through a mooring rope in order to cast a ship adrift. The knife takes out each strand until the whole is broken and the link is severed. Rather than provide a new stable settlement which will serve Scotland and the United Kingdom well in the years to come. I fear that it will lead to instability, friction and disruption and that Scotland's influence will be lessened here at Westminster and down Whitehall.
For example, how will all of the detailed discussions that those of us who have been in government know about—all the letters, minutes and meetings that take place in and between government departments, especially those whose responsibilities are to be 1531 devolved to the Scottish assembly—take account of Scottish interests? Will the Whitehall paperchase (if I may so describe it) include the Scottish executive in its Civil Service? If so, how can confidentiality be secured, especially if the Scottish executive does not like what it sees? Whether the same or different parties are in charge, I cannot believe that these papers will be circulated outside the UK Government and their ministries. I cannot therefore believe that Scotland's interests will be other than diminished within the Government of the United Kingdom. It is the relationship between London and Edinburgh that is at the very heart of the difficulties that I foresee.
I believe that Europe is a good example. In chapter 5 the Government recognise the problems of Europe and discuss the formulation of policy and co-operation. At the end of paragraph 5.4 they state: This will require, of course, mutual respect for the confidentiality of those discussions and adherence to the resultant UK line, without which it would be impossible to maintain such close working relationships". I do not believe that one can ask a parliament and executive answerable separately to their people to maintain and adhere to a UK line if they do not agree with that line. We all know that we have to do that within one government. Often we have to argue with our colleagues. Sometimes we lose and we then have to accept collective responsibility. I cannot for the life of me see how that collective responsibility can be widened to include the Scottish executive. Perhaps the Minister can tell me whether he has a secret answer to that.
It is said that the role of Scottish Ministers and officials in Europe will be to support and advance the single UK negotiating line which they have played a part in developing. In a previous existence I came to know a little about fishing and the common fisheries policy. Very often extremely difficult balances must be achieved between the interests of fishing communities in different parts of the United Kingdom. Sometimes Ministers have to return to Scotland to explain to the Scottish Fishermen's Federation why they have come up with the compromise that they have. It will be extremely difficult to ask a Minister responsible to an Edinburgh parliament to adhere to a UK line which is being attacked by Scottish fishermen for being too generous to the fishermen of the south west of England or Northern Ireland. It is interesting that, I understand, in Spain these matters are not delegated. The Spanish Government hold the reins and negotiate in Brussels. The Government should think again about matters such as fishing.
Will the Minister assure me that a person who is not a member of the UK Government can represent the UK at the Council of Ministers? Have the Government checked that out? Will they need to change any of the Acts relating to the Treaty of Rome or the Maastricht Treaty?
I turn to Scottish legislation. I presume, from the absence of any mention of it, that there is to be no role for this House in Scottish legislation. So I presume that the Minister will be the last in a long and distinguished line of Scottish Office Ministers in this Chamber. The Government themselves accept the need for a revising 1532 Chamber. They may not like the composition of this one, but my understanding is that they do not dispute the need for a revising Chamber. Not in Scotland, it would appear: no revising chamber there. Are the Government convinced that that is a sensible way to proceed?
If any secondary legislation arises from UK legislation which needs the attention of the Scottish parliament, will that go to the parliament or here? In the absence of the noble Earl, Lord Russell, perhaps I may ask whether the parliament will be able to alter secondary legislation which is sent to it by the other place, or will it, like this Chamber, be under convention not to make alterations in secondary legislation?
Paragraph 3.38 in the Welsh White Paper is an interesting one. It suggests that the assembly will be able to consider and debate legislation which is being considered at Westminster. Although I had a good deal of time, I have not noticed a similar provision in the Scottish document. Am I therefore right to conclude that the Welsh assembly might be asked for its view on, say, the Social Security Bill now before the other place, but that the Scottish parliament will not be asked to comment? Is that right? The Scottish parliament will have no right to comment, although the Welsh assembly will.
In case the Minister says that the Scottish parliament will have a right to comment, let us take Clause 68 of that same Bill, which brings one-parent benefit down to the same rate as that for other parents. I can foresee the Scottish parliament not being happy about that. What happens when it is not happy and it complains about UK legislation? We need some answers on that.
In addition to fishing, which I have already mentioned, the Minister is the UK forestry Minister. I presume from reading the White Paper and seeing that forestry is to be devolved that the Forestry Commission will now be split. That is a great pity. The Minister shakes his head. Does that mean that English and Welsh forestry will be the responsibility of the Scottish parliament? The Minister is shaking his head about that as well. Will he clarify the position, because I—if I may say so—cannot see the wood for the trees in this one. If it is to be separated, which English Minister will take it over?
Paragraph 3.3 deals with some of the matters which are not to be devolved. We shall have to consider carefully those which are listed under: Certain other matters presently subject to UK or GB regulation or operation". I ask with some interest why certain things such as abortion, human fertilisation and embryology are not to be trusted to the Scottish parliament. I am certain that Cardinal Winning will not be keen about that. I can understand some of the reasons, but if the general proposition is that that parliament can be trusted, why cannot it be trusted with that important legislation as well?
I turn to finance, which is largely in Chapter 7. Paragraph 7.2 clearly states: Scotland will continue to benefit from its appropriate share of UK public expenditure". 1533 Paragraph 7.6 talks about block arrangements. A few weeks ago we had a Statement about a fundamental expenditure review. Under questioning from me, we discovered that that was to include the Scottish Office. That review is to be the basis of the public expenditure survey in year three. Years one and two are already determined. They were laid down by us when we were in government. I was told that the Barnett formula will be in place for the next two years, but that thereafter it will not be. So I shall be interested in knowing what will happen to that Scottish block after the fundamental expenditure review, and what commitments the Government are prepared to give about that.
I notice that paragraph 7.12 states clearly that it is income tax only. I trust on that basis that the Government will not overturn the amendment your Lordships insisted upon earlier in the week.

§ Lord Sewel
My Lords, you have not got it yet.

§ Lord Mackay of Ardbrecknish
My Lords, I shall turn now to the number of MPs, which is one of the little surprises in this document, although it was not too much of a surprise because it was leaked all over the Scottish press this morning. We read what we see in the document. Is there any truth that 58 is to be the number? Will the Minister tell me? After all, that was the heavy Scottish Office briefing. Perhaps I may remind him what George Robertson, then the Shadow Secretary of State, said in January 1996: I think that if 72 is the right number now, then it is the right number after devolution". What has changed, apart from the fact that poor George Robertson was sacked from his Scottish Office brief and sent to defence? What I find interesting is that that is an acknowledgement of the West Lothian question—a question whose existence has been steadfastly refuted over the past 20 years. If it is an acknowledgment, that is good. It is not an answer, because the remaining 58 Scottish MPs will still have the same dilemma: how can they vote on matters that affect England when they have no votes over similar matters which affect their own constituents to whom they are responsible? What does the Minister have to say about that? He can no longer say that it is not a problem, and that it no longer exists, because paragraph 4.5 makes it clear that the Government think that it does exist and that it is a problem.
As to the role of the Secretary of State for Scotland, to whom will he be answerable—the UK Government and Parliament or the Scottish government and parliament? Or will he be a message boy between the two? Will he be bound by the collective responsibility of the UK Parliament? To revert again to the Welsh White Paper, I noticed in that document that the Welsh Secretary will be allowed to attend and speak in the Welsh assembly. Will the same be true of the Secretary of State for Scotland? Does that mean that he will have to go there and answer for what that parliament may think are the sins of the Westminster Parliament?
I turn to the polling system in Annex C. The Welsh White Paper sets out the polling system rather better than this one does. It is rather clearer. It is helpful to see 1534 the way through. I have not had time to study this, but I think that it is different. I suspect that it ends up with the same answer. I shall be wondering to myself later today why there is a difference. What is a bit odd is that the Government, having decided that we should never again use European electoral seats to elect European MPs, will base the electoral system on European seats. In all logic, before we come to a Bill, if that is what we come to eventually, the Government should look at another way of dealing with the problem and not keep in being seats which no longer have any relevance because we will not have such a thing as European parliamentary seats.
Paragraph C.4 worried me a bit: The Government intend to legislate for the registration of political parties". I am not keen on governments registering political parties. I can see why they need to do it, but we will need to look with a great deal of care and caution at the protections that will exist against a government deciding, because they do not like a party—we may all not like that party—they will refuse to register it. We have to look at that.
On page 5 of the Statement the Secretary of State says: The UK Parliament is and will remain sovereign in all matters". That is a bit better than Mr. Tony Blair's statement that, "sovereignty rests with me"; but it is a statement of the truth. Can the Minister say how that squares with the Secretary of State's signing of the "claim of rights" which said that sovereignty rests with the Scottish people? It seems to me that it cannot rest with both: it is one or the other. Can the Minister say which?
I have always felt that this proposal represented a slippery slope. I have always been upheld in that view by the fact that the Scottish National Party is very keen to support devolutionary proposals. In fact, the Government are very keen to get that party on board on the "Yes, yes". Therefore, the SNP will campaign for a "Yes, yes", wanting to drive the UK apart, while the Government, in their campaign for a "Yes, yes", will say that they do not want to drive the UK apart. The lion may well lie down with the lamb in biblical terms, but I am not sure that a unionist can lie down with a separatist.
I know that the Minister and his right honourable friend the Secretary of State, Mr. Donald Dewar, are men of honour. I know that they genuinely believe that if they do not go down this devolution road the Union will break up. I do not agree with that view. I believe that we are on far safer ground where we are at present, with Unionists among us, holding the arrangement of one United Kingdom Parliament. I believe that it would strengthen the Union if we were all to do so. The very fact that the SNP has actually gone backwards since it won 11 seats in 1974 illustrates that its threat is not nearly so great as the Minister and his party seem to fear.
1535 As I said, I know that the Government believe that what they are doing here will strengthen the Union. If this proposal comes into being, I earnestly hope that they are right. However, if I may say so in the Scots tongue, "I hae ma doots".

§ Lord Steel of Aikwood
My Lords, this is an historic day for Scotland and not a day for nitpicking. I believe that the White Paper will be widely welcomed and very thoroughly debated in Scotland; and, indeed, in this House, as well as the other place. We in this party have espoused the Scottish self-government cause over many decades and we are glad to have played some part in the fruition of the White Paper. The Statement made by the Secretary of State, and repeated in this House by the Minister, correctly pays tribute to the work of the Scottish Constitutional Convention. Indeed, the whole basis of the legislation rests on that work which was painstakingly carried out over some four or five years.
It is right that the Government claim in the Statement to have improved on the proposals of the Scottish Constitutional Convention. Perhaps I may give a particular welcome to the announcement in the White Paper that there will indeed be a reduction in the number of Scottish Members in the other place. That has always seemed to me to be totally correct. However, I have to say that we lost that argument in the convention and I am delighted that wisdom has finally dawned on the Government. They have agreed that, while it is not an answer to the West Lothian question, it is a mitigation of it to reduce the number of Scottish Members in Westminster so as to be on a par with those in England and Wales.
My one point of puzzlement on the latter is, why leave the actual number to be decided by the Boundary Commission. Surely that is a matter of political judgment. I see the noble Lord the Leader of the House shaking his head, but I remind him that we had a Royal Commission on the constitution in the 1970s. It came up with a specific recommendation in that respect. Therefore, why not found on that rather than leave it to the uncertainties of a non-political body to decide on the actual number? The principle should be that the number be reduced so that, now that we will have our own Parliament, Scottish Members at Westminster will no longer have smaller constituencies than those in England and Wales. That principle is one of political judgment. It is a new and welcome one from the Government's previously espoused position, as pointed out by the noble Lord, Lord Mackay.
Will the Minister confirm that there are other substantial differences between what is proposed this year and what was put to the Scottish people in the legislation of 1979? In particular, the proportional representation system is, to my mind, of crucial importance. I say that because if one studies the referendum results of 1979, one finds that there was great suspicion in the outlying areas of Scotland, including the area that I represented, about the proposals. As they stood in 1979, those proposals could have led to a minority among the population capturing a majority of the seats. It was a real fear that the Scottish 1536 parliament would be dominated, to put it bluntly, by a central Scotland Labour Party. Therefore, I pay tribute to the Labour Party. During the work of the convention, they recognised that that was a legitimate fear in Scotland and that has now been put right. It is a major advance on what was on offer in 1979.
A second advance which was not mentioned in the Statement—but one I am sure the Minister will confirm—is something that, again, will make a difference. I refer to the fact that in 1979 we argued for a third tier of government in Scotland, because we had two tiers of local government. From his own experience, the Minister will know that, because we now have a single tier of local government in Scotland, we are operating against a quite different background. We do not propose to have three tiers of government; indeed, there will in fact be two in Scotland—the national parliament in Edinburgh and a single tier of local authorities.
The third difference is the taxation powers. I was not present in the Chamber for the interesting debate which took place the other day on the issue. I hope that the Government will indeed reverse the amendment passed in another place and that they will leave the question of taxation powers as open as possible within the framework of the agreements in the White Paper.
There is one further point that I would like to draw to the attention of your Lordships' House; namely, that the White Paper is extremely liberal on the question of who is eligible to stand for this parliament. Members of your Lordships' House will be able to stand and that is something of great interest. However, so also will ministers of religion and priests. That is certainly of great interest to certain ministers of religion and priests in Scotland. We do not have a state established church in Scotland. Therefore, this is a welcome and new provision.
I also noticed that European Union citizens who are resident in Scotland will also be able to stand. That means that the noble Lord's Italian waiter, of whom we have heard so much in previous debates, will certainly have that possibility conferred upon him. Indeed, I should have thought that the noble Lord, Lord Mackay, would have given a particular welcome to that provision in view of his obsession with that particular gentleman.
I have one particular suggestion to make to the Government. As they say that they plan to hold the elections in Scotland in the first half of 1999, it seems to me that it would make administrative and financial sense to try to hold these elections on the same day as the European elections which fall due in June of 1999.
On the question of parliamentary premises, I counsel the Government against the dangers of grandiose extravagance. The Scottish people will not want to see a new architectural exhibition in the search for some new building. The public paid for the conversion of the Old Royal High School to a parliamentary chamber back in the late 1970s. I quite accept that it is not adequate on its own as regards the provision of parliamentary offices, but I suggest that a look should be taken at the old Scottish Office across the road. Indeed, it would be 1537 cheaper to bore a tunnel between the two than to construct a new building. I recommend that as a possible solution to the Government.
One very important point of principle in the White Paper is that we are to legislate to define "reserve matters" for Westminster and not the other way around. I regard that as a very important point of departure because it means that the Scottish parliament will have a momentum of its own. "Reserve matters" will be specifically allocated to Westminster and the Scottish parliament will be left to get on with every other aspect of life. I believe that to be correct.
I do not share the gloomy view expressed by the noble Lord, Lord Mackay, as regards the possibility of constant unhappiness and dissention over European Union discussions. I look forward to a second visit from the President of the Catalan Government during the referendum campaign when he will visit Scotland. I believe that he will be able to enlighten people like the noble Lord, Lord Mackay, as to what actually happens at present in a successful devolved parliament which has benefited greatly from its direct relations with the European Union.
The noble Lord, Lord Mackay, seemed to think that the Scottish parliament would, on occasions, be unhappy. I dare say that it will be; indeed, sometimes this Parliament is unhappy. The idea that this White Paper, or any legislation, can guarantee a state of perpetual bliss in the Parliament of Edinburgh is nonsensical. I believe that we shall see a state of sensible, creative political tension between Edinburgh and London which will be greatly to the benefit of the people of Scotland in particular but also to the people of the United Kingdom as a whole.

§ Lord Sewel
My Lords, it is rather difficult to reply in detail to the catalogue of what were not so much questions as accusations made by the noble Lord, Lord Mackay of Ardbrecknish. I have the feeling that basically his position is that if we proceed with legislation on the basis of the White Paper, we run the risk that civilisation as we know it will come to an end. I do not think that. I believe that his fears are based on a faulty analysis and his argument is flawed. In the White Paper, we have a coherent, clear and comprehensive way forward. But, above all, it is a way forward which is fair and balanced, stable and enduring. Those are extremely important objectives which we should seek to achieve.
That was one reason that we revisited the question of the number of Scottish MPs in the UK Parliament. We wanted to remove once and for all any lingering belief that somehow, the settlement itself would not be fair. It was in order to remove that doubt, to deal with that problem, that we took the view that it was right and proper to come forward with a fair and balanced proposal affecting the number of Scottish MPs at Westminster.
The noble Lord, Lord Mackay of Ardbrecknish, wondered what would happen if a Scottish parliament were unhappy about a matter which had been reserved to the Westminster Parliament. It is very simple. The 1538 Scottish parliament can debate any matter reserved to Westminster but cannot legislate on it. That is the point. It can debate what it likes, but on a reserved matter legislative competence rests with Westminster. Therefore, there is a clear difference of role and function which leads to clarity and stability.
The noble Lord also drew attention, as I expect will a number of other noble Lords during the course of the eventual Bill, to the fact that we do not propose anything like a second chamber. What we propose and what everybody who has been involved in the debate on a new parliament for Scotland has been advocating for the best part of 20 years is that a Scottish parliament should innovate and try to adopt new and modern procedures. Above all, it should address itself to what is seen as being some of the fundamental weaknesses of the legislative process. It should increase the amount of pre-legislative scrutiny. It should have a strong committee system, with an emphasis on pre-legislative scrutiny, and that removes the need for a formal second chamber. That can be worked into the processes.
The noble Lord, Lord Mackay of Ardbrecknish, referred to the Forestry Commission. That is a nice one and is simple to deal with. Legislative power and competence are devolved, so a Scottish parliament would be legislatively responsible for forestry. But clearly it is open to that body to make such administrative arrangements as it thinks appropriate. Those administrative arrangements could well mean the maintenance of a GB structure such as the way in which the Forestry Commission operates in any event. It may be that the noble Lord fails to recognise the difference between devolving legislative competence, on the one hand, and from that position to have the ability to make strong and effective GB or even UK administrative arrangements, on the other. They are not incompatible. They are often very sensible indeed.
I turn to the comments made by the noble Lord, Lord Steel of Aikwood. I recognise all that he said about the way in which the Government have moved and, I think, improved these proposals, certainly from those made in 1978. One important additional factor is that it will be remembered that in 1978 the Secretary of State for Scotland was to have considerable overriding powers. They now disappear and are not part of the procedures at all.
Yes, we have proceeded. We have given the new parliament stronger powers and a wider range of powers. Universities and higher education was not included in 1978. On the electoral system, we have moved to recognise the need to have an electoral system which makes the parliament inclusive rather than exclusive so that all the parts of Scotland can identify and accept ownership of the parliament.

§ 5.6 p.m.

Lord Campbell of Croy
My Lords, the Statement indicates that the Government, in my opinion, are taking grave risks in relation to stability not only for the new proposed body but also for the workings, structures and systems of the United Kingdom.
1539 I have one particular point to raise. Almost all the functions to be allocated to the new body, including all those mentioned in the Statement, are already devolved as a result of massive administrative devolution to the Secretary of State for Scotland and his Ministers and to the Scottish Office. I should point out, as it was a long time ago, that I had the onerous duty of being in the appointment of Secretary of State for Scotland from 1970 to 1974. Indeed, no Secretary of State for Scotland before me is still alive.
Will any of the present Scottish Office functions remain with the Scottish Office? Will the Secretary of State still have any of his present functions? The noble Lord, Lord Sewel, mentioned higher education. Of course, that was transferred to Scotland about four years ago. Other functions which have been transferred in the past 20 years to Scotland—and there have been others—are now naturally included but were not included and in 1978 higher education was then with the Department of Education.
My noble friend Lord Mackay of Ardbrecknish made some penetrating comments. Your Lordships will be glad to hear that I shall not make any further comments now but I shall reserve what I have to say further about this for the debate on Wednesday.

§ Lord Sewel
My Lords, I think perhaps unintentionally the noble Lord, Lord Campbell of Croy, has actually made the case for devolution. He pointed out quite rightly that there has been substantial administrative devolution to Scotland. We are addressing the democratic deficit which administrative devolution creates. We are matching that administrative devolution with legislative devolution and democratic accountability within Scotland. That is the whole argument. Administrative devolution is not enough.

§ Lady Saltoun of Abernethy
My Lords, there is one small thing I am not quite clear about—among others—that is, will the Scottish parliament be able to vote for independence or to increase its own powers in other areas?

§ Lord Sewel
My Lords, I am happy to reply to that question directly. As independence is a matter for the constitution of the United Kingdom, it is a reserve matter. The parliament could vote to express an opinion but it would have no consequence at all in legislative terms. It cannot extend its own powers; the powers are devolved from the Westminster Parliament.

§ Baroness Ramsay of Cartvale
My Lords, it was with great pleasure that I heard the Statement which my noble friend the Minister repeated in this House today. I look forward to discussing at greater length the contents of the White Paper which is clearly a document of considerable constitutional and historic importance. At this point I merely ask my noble friend the Minister whether he can expand just a little on how Scotland's voice will be heard in Europe. I ask that question in quite a different spirit from the questions on Europe put by the noble Lord, Lord Mackay of Ardbrecknish. 1540 I wish in particular to know how the measures proposed compare to the proposals from the Scottish Constitutional Convention on this question.

§ Lord Sewel
My Lords, we have addressed the problem of relations with the European Union in chapter 5 of the White Paper. We recognise—we make no bones about it—that relations with Europe are the responsibility of the United Kingdom Parliament and Government. That is the starting off point. Having said that, we have made it absolutely clear that we are doing everything possible to ensure that Scotland's voice will be heard and will be heard effectively in Europe. I refer my noble friend Lady Ramsay of Cartvale to specific points in the White Paper. It states, The UK Government wishes to involve the Scottish Executive as directly and as fully as possible in the Government's decision making on EU matters. It is part of the Government's intention that Scottish Executive Ministers and officials should be fully involved in discussions within the UK Government about the formulation of the UK's policy position on all issues which touch on devolved matters … The Government also propose that Ministers and officials of the Scottish Executive should have a role to play in relevant Council meetings and other negotiations with our EU partners … The Scottish Parliament will be able to scrutinise EU legislative proposals to ensure that Scotland's interests are properly reflected". We are determined that Scotland will be properly represented in Europe. We envisage that there will be a Scottish representative office in Europe. We shall build upon the regional framework which is developing in Europe to make sure there is an effective Scottish presence in Europe and that Scotland effectively contributes to the UK line in Europe.

§ Baroness Carnegy of Lour
My Lords, the Statement states with regard to finance, The tax-varying power will not apply to income from savings and dividends". Does that mean that it will apply to everything else? Will it apply to all other income? The Statement continues, The Inland Revenue will administer any tax variation, with the Scottish parliament meeting the administrative costs". Can the Minister give us any idea at all of the order of the administrative costs?

§ Lord Sewel
My Lords, the income tax power will apply to all income that is subject to income tax except savings and dividend income. On the administrative cost of raising income tax, there is at chapter—

§ Lord Strathclyde
7.19.

§ Lord Sewel
My Lords, I am most grateful to the Opposition Chief Whip for that. The White Paper states, Their setting up costs are estimated to be around £50m (which could be phased) and running costs at around £6–£15m". That refers to collection through PAYE which will generate additional cash for employers. Costs will fall upon the parliament in changing and administering the 1541 new tax system—the modification to the tax system—and there will, of course, be a compliance cost for employers.

§ Lord Mackie of Benshie
My Lords, I have been advocating a Scottish parliament longer than anyone else in this House. I started to do so in the election of 1950. I am delighted that this has come about at long last. I am astonished at how good the White Paper is. I did not think the Government could be so generous. I remember that the noble Lord, Lord Mackay, also advocated a Scottish parliament at one time. I am amazed that he does not praise the generosity with which the Government will throw away at least a dozen seats in Scotland and will introduce PR, which will give us a fair chance of a fair parliament in Scotland.
The White Paper is enormously promising. Of course there are difficulties, but in congratulating the Government on the White Paper which delights me, I ask them how they propose to apply the sensible provision in chapter 4.15 which might solve many of the problems referred to by the noble Lord, Lord Mackay of Ardbrecknish. Paragraph 4.15 states, The Scottish Executive and the UK Government may from time to time take different views … There will therefore he procedures for identifying and resolving". That is a sensible measure. Will the Minister say a little more about that?

§ Lord Sewel
My Lords, I thank the noble Lord, Lord Mackie of Benshie, for what he has said about the White Paper. I repeat that our guiding principle in working towards the White Paper and its publication and the policies that it contains has been to establish a fair, stable and enduring settlement. In some areas that may work against the immediate interests of my party but that is a price worth paying.
The noble Lord asked about the dispute procedures on vires. That matter would be dealt with during the progress of legislation through the Scottish parliament. It would be for the presiding officer to reach a view on the competence of any piece of legislation, whether or not it fell within the competence of the Scottish parliament. However, it would be open to the UK Government to seek to challenge the vires of an Act of the Scottish parliament. If that could not be resolved by agreement, it would be resolved through the Judicial Committee of the Privy Council.

§ Lord Merlyn-Rees
My Lords, I refer to next steps. Legislation in this field and in the case of Welsh devolution will not necessarily be easy. Could not a series of research papers be produced which would not reflect government policy but provide ideas on how these various matters may be dealt with? It is worth looking at the Act concerning the government of Ireland which went through this Parliament in the 1920s. How did that Act deal with issues concerning Members of Parliament elected for this Parliament and Members of Parliament elected for the devolved administration? In my early days in the other place there were Unionist Members of Parliament from Northern Ireland voting on matters which affected the United Kingdom, although 1542 they had pronounced powers relating to devolution in Northern Ireland. The excellent ideas of the noble Viscount, Lord Whitelaw, for power sharing in the Province—they came to naught for other reasons—should be considered. All the papers relating to that are available. The rolling devolution of the noble Lord, Lord Prior, should be looked at.
Lastly, let us consider how Northern Ireland encompasses the European aspect. Northern Ireland has offices in Brussels, New York and London. The question of what to do about Europe is not new. I see people shaking their heads. It is answered for Northern Ireland; why not for Scotland?

§ Lord Sewel
My Lords, the noble Lord makes a number of powerful points. Some of us have been reading research papers, and even writing the odd research paper, on this issue for some long time. Some of us are even familiar with the precise details of the Government of Ireland Act 1920.
The valuable point that the noble Lord makes is to draw our attention to the Ulster situation. During the period of the Stormont Government, Westminster Members of Parliament from Ulster came to Westminster and voted on a full range of issues. There was never any questioning of that. We have never dealt with the problem of regional legislatures in the United Kingdom by adopting a two-tier membership approach, an in-out approach. Parliament has consistently set its face against that move. It is unworkable, and we have shown how we seek to move forward on the basis of a fair and just settlement.

Lord Renton
My Lords, will the Minister answer the question of my noble friend Lord Campbell of Croy about the ultimate responsibility of the Secretary of State to the United Kingdom Government and Parliament? Will he also tell us what is to happen when there is a conflict of interest between the United Kingdom Government and the Scottish executive and parliament on a European Union matter? The White Paper does not answer that question.

§ Lord Sewel
My Lords, I apologise if I did not answer the question of the noble Lord, Lord Campbell of Croy. Let me make clear that the ultimate responsibility for the Secretary of State for Scotland will be to the Westminster Parliament. It is unlikely that he will be a member of the Scottish parliament. He is a Member of the UK Government and will be a Member of this Parliament. He is responsible and accountable to the UK Parliament.

Lord Campbell of Croy
My Lords, that was not quite my question. I asked what functions that he now retains through the Scottish Office will he retain, if any?

§ Lord Sewel
My Lords, the areas of domestic policy that the noble Lord identified will pass to the Scottish parliament. Those functions will no longer stand to be exercised by the Secretary of State for Scotland.
1543 One of the clear responsibilities of the Secretary of State for Scotland in these devolved arrangements will be to represent Scotland's interest in the reserved matters: to make sure that Scotland's voice is heard across the important range of reserved matters which remain at Westminster. Secondly, he can make an effective contribution by acting—I believe that the noble Lord, Lord Crickhowell, amused us in an earlier debate with his use of the word "conduit"—as a means of communication. Heaven's above, my Lords, we are a mature democracy. We must recognise that a Scottish parliament and a UK Parliament may have differences of views. As we are mature politicians in a mature democracy, one of the important contributions that the Secretary of State could make is to act as an effective line of communication between those two governments.
There was a second point which escapes me.

Lord Renton
My Lords, who is to have the last word when there is a conflict of interest between the UK Government and the Scottish executive in parliament on a European Union proposal?

§ Lord Sewel
My Lords, we are absolutely clear on that in the White Paper. It is the fact that there will be an agreed UK line; and in the end it is the responsibility of the UK Government to represent the United Kingdom in Europe.

§ Lord Howie of Troon
My Lords, is my noble friend aware that I welcome the White Paper with great pleasure, apart from some uneasiness about which he knows concerning the proposed electorate for the referendum? I leave that aside.
I wish to question the Minister on the unicameral nature of the proposed assembly. He says that scrutiny will be done largely through pre-legislative committees. It may be more complicated than that. But is it not a weakness that in the proposal the scrutiny and legislation will be carried out by the same people? Under the Westminster system the legislation, and the scrutiny of it, are undertaken by two different sets of people, with two different sets of expertise? Is the noble Lord quite sure that the proposal is better than the bicameral nature of the Westminster Parliament?

§ Lord Sewel
My Lords, I am grateful to my noble friend for his endorsement of the White Paper. The noble Lord makes a valid point, but I do not think that it is persuasive. The point can equally well be made that in a unicameral system one can set up scrutiny committees which have that specific role. Therefore the same people are not scrutinising the legislation. There is a difference of function built into the committee structure of the parliament.
My noble friend Lady Ramsay of Cartvale is the expert in this area, but I am aware that there are some extremely interesting and effective examples of how Scandinavian parliaments build a scrutinizing 1544 mechanism into the structure of unicameral parliaments. That is a matter that the new parliament will wish to examine, and perhaps adopt.

§ The Earl of Lauderdale
My Lords, perhaps I may—

§ The Lord Privy Seal (Lord Richard)
My Lords, I am sorry. This matter arose the other day. I am afraid that the 20-minute period is mandatory. There is nothing that I can do about it.

§ Lord Strathclyde
My Lords, I understand that the 20 minutes of Back-Bench time has now been completed. However, before the next business commences, will the noble Lord, Lord Sewel, follow the example set yesterday by his noble friend Lord Williams of Mostyn? Will he write to noble Lords who asked questions which have been unanswered and make sure that those answers are in their hands before Tuesday and that copies are placed in the Library? That will be extremely helpful for the debate on Wednesday.

§ Lord Sewel
My Lords, I am happy to give a general undertaking of that nature. However, I have to make the reservation that I shall do my best to ensure that they are available by Tuesday night.