Germany (Hansard, 29 January 1992)

§ 12. Mr. Darling
To ask the Secretary of State for Scotland if he will make a statement on his visit to Germany.

§ Mr. Lang
I had a successful visit to Bavaria in September last year when I led a trade mission organised by Scottish Financial Enterprise. The mission has assisted in establishing stronger financial and commercial links between Scotland and that part of Germany.

§ Mr. Darling
Does the Secretary of State accept that one of the reasons for Germany's outstanding economic success is its decentralised form of government? Does he not also accept that Scotland would gain by having its own Parliament with control over key decisions while at the same time using the clout of United Kingdom partnership in a Europe dominated by large countries? The Secretary of State's policy of doing nothing and of stagnation, and the nationalist policy of taking Scotland into Europe's second division, would both be disastrous for the people of Scotland.

§ Mr. Lang
The thing that struck me most on constitutional matters during my visit to Bavaria was the complete incomprehension of my Bavarian hosts that anyone should take the view taken by Opposition parties in this country that constitutional mechanisms can be the key to economic success. In Germany, the Länder compete with one another to keep taxation down. Labour is seeking to raise taxes exclusively in Scotland, which would be more damaging for Scotland's economic future than almost any other proposal.

§ Mr. Harry Ewing
Is the Secretary of State aware that the Bavarians would be just as baffled by his own view that the constitutional mechanism would lead to economic ruin? I am sure that he did not explain that to the Bavarians. When the Secretary of State went to Germany, did he find any part of Germany which had suffered as a result of the devolved system of government? The Under-Secretary of State, the hon. Member for Eastwood (Mr. Stewart), was present at a press conference about recent inward investment in the constituency of my hon. Friend the Member for East Kilbride (Mr. Ingram). Did the Under-Secretary feel uncomfortable when the owner of the company bringing the investment to East Kilbride said that he would still have made that investment against the background of a Scottish Parliament?

§ Mr. Lang
I could quote many business men who have said the direct opposite. If the hon. Gentleman cared to read the Scotland on Sunday business view survey of 200 company directors last december, he would see that 86 per cent. said that a Scottish assembly would not help the Scottish economy, 78 per cent. said that it would deter inward investment, and 64 per cent. said that they would rethink investment strategy and levels of employment. If the hon. Gentleman does not understand the damage that a tax-raising assembly would do to Scotland's economy, and what the raising of a tax border across the frontier between Carlisle and Berwick would do to the people of Scotland, he had better have another look at his plans.

§ Mr. Marlow
rose—

Hon. Members
Speak for England!

§ Mr. Speaker
Order. It is about Germany.

§ Mr. Marlow
As my right hon. Friend knows, there is a devolved system of government in the Federal Republic of Germany. If there were a devolved system of government in the United Kingdom, and if Scotland had its own Parliament, would it not be democratically improper and immoral for the right hon. and learned Member for Monklands, East (Mr. Smith) and the hon. Members for Dunfermline, East (Mr. Brown) and for Livingston (Mr. Cook) to harbour ambitions to govern England? Is not devolution a fraud?

§ Mr. Lang
My hon. Friend identifies a very important issue which the Labour party has completely failed to address. Labour has failed to recognise that if there is a measure of devolution of the kind that Labour identifies, it is not just some bolt-on extra but brings costs and a down side as well as the benefits that Labour perceives. That is the kind of issue that would have to be addressed. I can see the strength of my hon. Friend's view that it would be very difficult to sustain morally the position that the Labour party advocates.

§ Mr. Dewar
Reverting to the Secretary of State's foreign travels, does he accept that, by continuing to pretend that there can be no change, that the German option, the Spanish option and the Italian option can never be the British option or the Scottish option, he is in danger of destroying the Union to which he pays lip service?

§ Mr. Lang
The German option, the Spanish option and the other option that the hon. Gentleman identifies are not 947 the option that his party is offering the people of Scotland. If he does not understand that, he really should go back to the drawing board.