Government of Wales Bill

HC Deb 08 December 1997 vol 302 cc671-768

Order for Second Reading read.—[Queen's consent, on behalf of the Crown, signified.]

Madam Speaker

I inform the House that I have selected the amendment standing in the name of the Leader of the Opposition.

3.44 pm

The Secretary of State for Wales (Mr. Ron Davies)

I beg to move, That the Bill be now read a Second time.

This is an historic moment for Wales. In the Bill, the Government seek the agreement of the House to the principle that there should be a national assembly for Wales—a new institution that will both herald a new style of more inclusive politics that better fits the needs and the character of Wales, and open to public scrutiny and accountability the machinery of government in Wales.

This United Kingdom Parliament is sovereign. The provisions of the Bill do not challenge that sovereignty in any way—nor could they. What the Bill does is open up a new prospect: the ever expanding powers and responsibilities with which Parliament has endowed the Secretary of State for Wales should in future be exercised by a body that is as responsible as the House is to its own democratic mandate. The Bill therefore contains the Government's detailed legislative proposals to set up the national assembly for Wales, and to take action to reform the quango state and so bring effective democratic control closer to the people of Wales.

Since the House considered the Referendums (Scotland and Wales) Bill, the Government have issued the White Paper, "A Voice for Wales", which sets out our detailed proposals for the assembly. Those proposals were put before the voters of Wales and were endorsed. The Bill faithfully translates the White Paper pledges into legislation—therefore, nothing in the Bill should come as a surprise to any right hon. or hon. Member.

The Referendums (Scotland and Wales) Act set one test, and one test only. Although we challenged the official Opposition at the time to say in the House what other threshold they would set, they declined to do so. The majority of voters supported the proposals set out in the White Paper.

Mr. Richard Shepherd (Aldridge-Brownhills)

How, in all fairness, can the Secretary of State claim that the proposals in the White Paper were endorsed by the referendum result? When given the opportunity to vote on and endorse those proposals, 75 per cent. of the Welsh electorate declined to do so. The vote in favour of the proposals was fractional, and was easily swamped by the many Welsh residents in constituencies such as mine and others throughout the west midlands and the rest of the country. The referendum provided no validation of the proposals. The only validation that the right hon. Gentleman can claim is that provided by the general election—which is a valid point.

Mr. Davies

I trust that, like me, the hon. Gentleman recognises the sovereignty of this Parliament. Parliament decided, through votes in this and the other place, to hold a referendum for Wales, and Parliament set down the rules for that referendum. When they voted on 18 September, the people of Wales passed the only test that was required of them: the majority of those who cast their votes in that referendum voted in favour of the proposition that there should be an assembly for Wales.

The hon. Member for Aldridge-Brownhills (Mr. Shepherd) has pursued his argument at length for some months, and I commend him on his consistency. However, I hope that he will now accept—and perhaps show the way to his right hon. and hon. Friends—that the referendum has been held. It did not produce a decisive decision, but the people of Wales gave a clear decision: they voted yes in the referendum. That is the mandate we sought, and that is the mandate on the basis of which we now proceed.

As I have said, the referendums Act set one test, and one test only. The majority of voters supported the proposals set out in the White Paper, and we shall now legislate on that basis. None the less, I recognise the closeness of the outcome—the point made by the hon. Gentleman. Since the referendum, we have striven to ensure that the detailed legislation for the assembly will provide a response to the concerns raised during the referendum campaign, as well as meet the aspirations of the majority who supported the creation of the assembly. [Interruption.] The hon. Gentleman seeks to intervene from a sedentary position. I did not notice him or the right hon. Member for Devizes (Mr. Ancram) in Wales during the referendum campaign.

I acknowledge the fact that the hon. Member for Ribble Valley (Mr. Evans) made the occasional television appearance, but the Conservative party was in a state of paralysis during the referendum campaign. The Conservative party knew that it had been rejected by the people on 1 May. It knew also that it was heading for a defeat in the referendum on 18 September, so it chose to opt out of the referendum campaign. If the hon. Gentleman had played a more constructive and more full-hearted role in the campaign, perhaps his comments now would have rather more credibility than they do.

Mr. Barry Jones (Alyn and Deeside)

On a constructive note, may I tell my right hon. Friend that travelling from the north in my constituency to the south to Swansea or Cardiff, for example, is very difficult either by road, rail or air? If my right hon. Friend plans to make the assembly successful in its daily work, will he improve communications? Will he look particularly to the advantages of Hawarden airport being enlarged?

Mr. Davies

At this stage, I cannot promise the hon. Gentleman that the assembly will be at Ewloe. I recognise that he has consistently advanced the argument that he set out in his question. He has always drawn attention to the difficulty of communications between the north and the south.

The assembly will be fully empowered to discharge the transport responsibilities that I currently have. As the rail and air sectors are in private hands, it will be for the assembly, rather as the Under-Secretary of State, my hon. Friend the Member for Neath (Mr. Hain), is currently doing, to meet the operators to ascertain how best we can develop voluntary arrangements. The Government certainly recognise the difficulty of communications between the north and south, and it will be for the assembly to decide what priority it wishes to give to improving communications.

Mr. Simon Hughes (Southwark, North and Bermondsey)

Will the right hon. Gentleman give way?

Mr. Davies

Yes, I shall give way to the hon. Gentleman, but I am anxious to proceed.

Mr. Hughes

I commend the Secretary of State for the way that he worked for the referendum result, as I did, in my modest way. One of the things that troubled me and made me think that the result that the right hon. Gentleman and I wanted might not be achieved was that people in mid and north Wales felt that the assembly might be more remote than they would wish. It would be helpful if the Secretary of State could address the ways in which to ensure that the assembly is not seen as a south or south-east Wales-based institution, and is clearly seen instead to be an assembly for the whole of Wales, accessible to all and available for all to participate in the democratic process.

Mr. Davies

That is one of the matters that I want to take up later in my remarks. I hope that the hon. Gentleman will forgive me if I do not take up the matter now. The advisory committee that we shall be setting up will have a remit to examine the question. There will be a statutory requirement on the assembly to have a committee for the north, to ensure that the particular concerns of north Wales are taken into account.

There are many matters of detail before us, and I want to ensure that there is an opportunity for right hon. and hon. Members on both sides of the House to give full consideration to the detail in the Bill. We have two days on Second Reading, and I hope that it will be possible to take some of our consideration in Committee on the Floor of the House and some in Standing Committee.

Mr. Michael Ancram (Devizes)

The Secretary of State began his speech by saying that we are dealing with a constitutional Bill. I presume he believes that it is a significant constitutional Bill. Why is he breaching the convention that the entire Committee stage is taken on the Floor of the House?

Mr. Davies

It is for the House to decide its own procedures. The question of precedent is not one at which I baulk. A precedent is merely something that we do for the first time. As far as I am concerned, this is the first time that a Government of Wales Bill has been introduced by the Government. If it means that we must change our procedures to get the proposed legislation through the House, that suits me.

I think that it would be convenient for the House if we were to have a reasoned debate. I am prepared to discuss with the right hon. Gentleman over the coming months how we should handle the Bill. It seems reasonable to have debates on the key clauses on the Floor of the House, with detailed debate in Standing Committee, so that right hon. and hon. Members who wish to explore the detail of the Bill can do so. With so few Conservative Members in the Chamber, however, there is scarcely any evidence of overwhelming demand on the part of the Conservative party to engage in a lengthy debate on these matters.

We have two days to discuss Second Reading. There will be plenty of time to debate the Bill both on the Floor and in Committee. I hope that the right hon. Member for Devizes will wake up to reality. The Bill is going to proceed. It is in the interests of the Opposition, of the Conservative party and of the Conservative party in Wales that he co-operates to ensure that the Bill is properly scrutinised.

Mr. Donald Anderson (Swansea, East)

Is not the reality that it might have been possible to have all proceedings on the Floor if the Conservatives had not made minor, silly points to seek to drag out the discussions, but come forward with a reasonable timetable? Their response so far has shown that they are not ready to accept the result of the referendum.

Mr. Davies

My hon. Friend is right to make that point. It was clear from day one of the debate on the Referendums (Scotland and Wales) Bill that the Conservative party was determined to delay and frustrate, and to use every tactic to wreck it. That measure sought only to ask the people of Wales what they thought about the proposition. The attachment of the Conservatives to democracy was so passing that they did not even want that measure to pass.

Mr. Ancram

Is the right hon. Gentleman inviting the Conservative party to put forward a timetable for having all proceedings in Committee on the Floor?

Mr. Davies

No, I am not. The right hon. Gentleman knows that that is not what my hon. Friend the Member for Swansea, East (Mr. Anderson) was saying. I have made it clear that I want the Bill to receive proper consideration. I want the important clauses to be taken on the Floor and an opportunity for detailed examination in Standing Committee.

Mr. Ancram

Indicated dissent.

Mr. Davies

It is no good the right hon. Member for Devizes pouting and shaking his head. I am making it clear that that is what I want to do. If he doubts my good intentions, I suggest that he uses the time-honoured process of going through the usual channels. He will see then that I am sincere about wanting a reasonable debate on the Floor and in Standing Committee. I hope that he will come out of his shell, join the latter part of the 20th century and help us to prepare for the new democracy that we are about to create in Wales. I know that that is an unlikely prospect, but subject to that, the Government will table a motion at the end of Second Reading to achieve it.

The Bill fulfils the Government's manifesto commitment to introduce for Wales arrangements that respond to the needs of a modern society. Before the House are detailed proposals for a new model of an all-Wales elected government that will draw on best practices from Westminster and from local government. The proposals are integral to the Government's plans for wider constitutional change, including a Scottish Parliament, regional development agencies for England, the incorporation of the European convention on human rights into English law, and the examination of options for electoral reform.

The assembly will be a national assembly for all the people who live in Wales, in whatever part of Wales and whichever language they speak. It will be an assembly for those who were born in Wales and for those who have chosen to live in Wales. The Bill makes specific provision for the way in which the assembly will involve local government, the voluntary sector and business. The assembly must be open for all interests to be properly and freely expressed and to allow people as individuals, as well as organisations, to have their voices heard.

The executive and administrative functions already exercised by the Welsh Office and the quangos spread across a range of matters that affect our everyday lives in Wales: decisions relating to how our children are taught in school, investing in new national health service facilities, protecting the environment, building factories and supporting job creation. The Welsh Office and the quangos will come under the control of a democratically elected body. Far from introducing another tier of government, the creation of the assembly will democratise an existing, powerful tier.

As I have said before, the Bill offers no surprises. It translates the principles of the White Paper into a clear and coherent set of legislative proposals. Part I sets out the arrangements for elections to the assembly and the proportional election system to be used. It also sets out the criteria that candidates in assembly elections need to meet, and the rules relating to their pay and allowances.

Sixty members will be elected to the assembly, 40 by the first-past-the-post system from existing parliamentary constituencies, and 20 from electoral regions under the additional member system, which, for the first time on mainland Britain, introduces a voting system based on proportional representation. Those arrangements will enable the total number of seats gained by a party more accurately to reflect the number of votes cast for it across Wales.

The reasoned amendment tabled by the official Opposition criticises the Bill for not catering for minorities. If there is one recognisable minority in Wales, it is of course the Conservative party, and it is precisely the Conservative party that stands to benefit from the additional member system that we propose. The reasoned amendment also talks of not securing Wales's place in the United Kingdom. There will be no reduction in the number of Welsh Members of Parliament as a result of the creation of the assembly, because the House of Commons will continue to pass primary legislation for Wales.

Mr. Ted Rowlands (Merthyr Tydfil and Rhymney)

Will my right hon. Friend explain how we arrived at the figure 60? On what calculation was it based?

Mr. Rhodri Morgan (Cardiff, West)

It is the number of seats in Swansea guildhall.

Mr. Davies

My hon. Friend the Member for Cardiff, West (Mr. Morgan) mentions a novel formula that has not been incorporated in the Bill. As my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) will know, the figure 60 was arrived at by a policy commission of the Labour party, which examined the electoral arrangements for the assembly. There was consultation in the Labour party.

The 60 figure results from the fact that there are 40 parliamentary constituencies. At that time, we had five European constituencies. It was believed that a first-past-the-post system based on the existing parliamentary constituencies and an additional member system using the combination of five European constituencies, each with four members, would be the best way of achieving an assembly that was broadly proportional. That system has an additional advantage, in that it is compatible with the system that had already been arranged for the Scottish Parliament.

I appreciate my hon. Friend's interest, and I know that he wishes to suggest some novel and principled alternatives. Subject to the views of the Opposition—if they are minded to express them—I should have thought that the question of the electoral system would best be debated on the Floor of the House, so that all hon. Members, regardless of party and regardless of their views, have an opportunity to press their case.

Mr. Richard Livsey (Brecon and Radnorshire)

The Labour party originally proposed an assembly with 80 members. Subsequently, that number has been reduced by 25 per cent., following an agreement within the party. Can the Secretary of State enlighten us as to how that occurred?

Mr. Davies

It is a long and complicated story about internal Labour party politics.

Mr. Desmond Swayne (New Forest, West)

Tell it.

Mr. Davies

I am happy to detain the House, but I fear, Madam Speaker, that you and others would berate me if I did.

The Labour party originally proposed an assembly with 80 members, two for each constituency: one would be a man and the other a woman. That proposition was ruled out by the Leeds industrial tribunal of a couple of years ago, which effectively prevented us from adopting the system. We then engaged in discussions, and it was decided at the same time—not necessarily in response to the urging of the hon. Member for Brecon and Radnorshire (Mr. Livsey) and his party, but with that urging in mind—to move towards a system that embraced an element of proportionality. It was during those discussions that we came up with the figure 60.

I ask the hon. Gentleman not to chide me. It was the leader of his party who, before the election, entered into an arrangement with the Labour party to support that electoral system, and we must accept that it is a reasonable basis on which to hold the first elections. Let me give the hon. Gentleman a reassurance; he will not welcome it particularly, but I shall give it to him anyway. I will resist any attempt to change the electoral system during the passage of the Bill, because I think that we have a system that commands broad support, and that we must now try it out.

Part II of the Bill covers the assembly's functions, providing for ministerial functions to be transferred to the assembly by Order in Council. It gives the assembly powers to reform Welsh quangos and the Welsh health authorities.

The Government's policy is that virtually all the functions of the Secretary of State for Wales should be transferred to the assembly. The assembly will obtain functions in one of two ways. Some functions will be conferred directly on the assembly by primary legislation, such as clauses 28, 29 and 33 of the Bill. I expect future Bills, from the next Session onwards, to proceed in that way. However, an enormous range of functions is in extant legislation. Those functions are currently exercised by the Secretary of State for Wales, and will be transferred to the assembly by an Order in Council under clause 22.

The Government have already given a commitment in the House of Lords that a working draft of the transfer order will be made available in time for the Committee stage. I hope to publish such a draft in January, in good time for the debate on clause 22. It will be a working draft, and will be as comprehensive as we can make it at the time.

An Order in Council under clause 22 may not be submitted to Her Majesty unless it has been approved by affirmative resolution of both Houses of Parliament. The House will have the opportunity to agree the final proposals.

Dr. John Marek (Wrexham)

Clause 35 refers to the staff of the Welsh Assembly and provides for them to be members of the home civil service. To whom will those civil servants owe their loyalty? It will be to the Crown, but will it be to the Crown via the assembly, via the head of the home civil service, via a Minister in Westminster or via this Parliament? I can foresee problems, so the matter requires careful consideration.

Mr. Davies

We discussed that matter in some detail when we prepared the White Paper, in which the arguments are set out. There have been discussions in the Welsh Office and with the civil service unions. Day-to-day reporting responsibilities for the civil service will remain with the permanent secretary or with whichever member of the civil service carries that responsibility in the future. The day-to-day direction of political strategy that civil servants should follow will be set in future by the assembly, and not by the Secretary of State as it is at the moment.

It is my intention to transfer functions to the assembly under clause 22 as quickly as possible. However, the power to transfer ministerial functions will continue to be available. I was pressed on that point in previous debates by the right hon. Member for Caernarfon (Mr. Wigley). I draw his attention to the provision in the Bill that will allow for the subsequent transfer of ministerial functions to the assembly. Further significant functions over and above those which I now exercise could be transferred to the assembly at a future date, subject to agreement by both Houses of Parliament. As I have said before, devolution is not an event, but a process.

Mr. Dafydd Wigley (Caernarfon)

Is the Secretary of State confirming, that if there is a need or a wish to transfer functions such as the police, which are now with the Home Office, to the assembly, it will be necessary first to transfer them to the Secretary of State and then from the Secretary of State to the assembly? If so, how does that fit in with the list of functions in schedule 2, which does not seem to leave room for that transfer to take place? Can schedule 2 be amended by any of the orders that he has in mind under clauses 22 and 23?

Mr. Davies

The order under clause 22 is not intended to be comprehensive, nor is it final. The right hon. Gentleman's understanding is correct. If, at some future date, a future Government decided to transfer law and order functions to the Secretary of State for Wales, knowing that they would then be transferred to the assembly, they could do so using the mechanism in clause 22. The initial transfer order merely transfers the functions that currently rest with the Secretary of State, but it does not mean that there is no possibility of a future transfer.

Mr. Denzil Davies (Llanelli)

Does my right hon. Friend intend to transfer all the existing functions of his office at one and the same time to the Welsh Assembly, or is he contemplating a phased transfer?

Mr. Davies

Some functions will be retained by the Secretary of State, but they are few and they are specified in the Bill. I am sure that that is not a matter of disagreement between my right hon. Friend and myself. However, in the transfer order, which will probably be presented in March 1999, I intend to transfer at that point the overwhelming majority of the powers that currently reside with me. There may be a need for some tidying up afterwards, but the policy is that there should be a transfer.

I have already taken action to roll back the frontiers of the quango state in Wales. The Bill provides me with the power to take more immediate steps to amalgamate the three development agencies and to merge Tai Cymru with the Welsh Office. It further provides that the assembly will have radical powers to make changes to most public bodies in Wales, including health authorities. Those powers will provide for abolition, where appropriate. The emphasis is that, in the longer term, it must be for the assembly to decide the delivery mechanisms for the functions for which it will take responsibility, including whether to continue with current arrangements, make changes, initiate mergers or take on some or all the functions itself. That is what devolution is all about.

For most other public bodies—with a few exceptions that were explained in the White Paper—the assembly will have the power to transfer their functions to local authorities, to other public bodies or to the assembly itself. In addition, all public bodies will be subject to democratic oversight by the assembly, and they will be accountable to it for their performance and, of course, all appointments that are made by me at the moment to such bodies, and those appointments about which I am currently consulted, will transfer to the assembly.

Mr. Cynog Dafis (Ceredigion)

What about a body such as the Curriculum Assessment Authority for Wales, the Awdurdod Cwricwlwm, Cymwysterau ac Asesu? The assembly may wish to bring together the functions of curriculum assessment and development and examinations, because those functions are closely linked. Examinations are the responsibility of the Welsh Joint Education Committee, which is a local government body. Would it be possible to bring about such useful integration, to provide a more efficient system?

Mr. Davies

I shall need to check to give the hon. Gentleman a precise answer, because he mentions a body which, as he knows, has its origins outwith the Welsh Office and the Secretary of State. I shall write to him with a detailed answer before the Bill goes to Committee. I do not want to speculate on an answer at this stage.

Part III of the Bill deals with assembly procedures. It requires the Secretary of State to appoint a commission to draw up the assembly's standing orders, and it specifies a number of principles such as openness, accountability and regulation of members' interests, which the standing orders must reflect. It also provides for the role of the assembly's leadership and committees. Standing orders will need to provide for the equal treatment of the English and Welsh languages, for equal opportunities, openness, accountability and integrity.

The Bill also requires the assembly to set up both standard and fast-track procedures for approving and making secondary legislation. Where appropriate, the standard procedures must include preparation of a regulatory appraisal and consultation, including with business interests, on any significant compliance costs.

The Bill provides that the assembly must establish an executive committee and various subject committees, with memberships reflecting the balance of the parties elected to the assembly, to cover the range of matters that are set out in schedule 2. For example, they include economic development, transportation, the Welsh language, regional committees and so on as prescribed by the standing orders. The standing orders will set out the detail on the operation of committees, sub-committees and delegation powers.

I announced last week that I am establishing a national assembly advisory group to assist me in preparing guidance for the Standing Orders Commission. I hope to be able to make an announcement later this week about the membership of that group, which will contain representatives of all political parties. I acknowledge the ready co-operation of the Conservative representative who has agreed to serve on the advisory group.

Mr. Ancram

I am slightly puzzled by that, because, in the setting up of such advisory groups, the normal procedure, as followed by the Secretary of State for Scotland, is to write to the shadow spokesman and ask for a nomination. I still await a letter.

Mr. Davies

The problem is that, when I write to my shadow spokesman, I never get a reply. [Interruption.] The right hon. Gentleman must be patient. He has asked a question, and I shall give him an answer. I have consulted widely with Conservative party representatives in Wales.

Mr. Ancram

In Wales?

Mr. Davies

I know that the right hon. Gentleman has been to Wales once, but he does not know everything about Wales. He should contain himself. I have consulted widely with the Conservative party in Wales and, later this week, when I unveil the advisory group, he will acknowledge that the Conservative member on the group has impeccable credentials. I have no doubt that, when I announce the name later this week, the right hon. Gentleman will be the first to endorse him.

The advisory group will debate and seek views on the key principles concerning the assembly's working arrangements. It will consult widely, and I hope that a wide range of views will be expressed and that consensus will be developed on the best working arrangements for the assembly. [Interruption.] The right hon. Member for Devizes is still chuntering away. Perhaps I could clarify the point. Is he now saying that, if I had written to him, he would have responded and offered names of people representing the Conservative party who would have sat on the group?

Mr. Ancram

The right hon. Gentleman might perhaps have consulted his colleague the Secretary of State for Scotland, who, having announced publicly that he would do so, wrote to me some three weeks ago asking for a nomination for his equivalent advisory body. I have nominated for that body a very senior Conservative party member, who will play a constructive role in it. I would have expected the same courtesy from the Secretary of State for Wales.

Mr. Davies

It is a matter not of courtesy, but of practice. The Secretary of State for Scotland has decided to consult in his way. I have consulted widely with Conservative party interests in Wales and I assure the right hon. Gentleman that, later this week, he will accept the fact—I have no doubt about this, because he is not a churlish individual—that the individual who represents the Conservative party interest on the advisory group has wide experience and is a fitting representative of the Conservative party.

As I have said, the advisory group will consult widely, and I have no doubt that a consensus will be developed. Importantly, however, I do not want the Bill to be too prescriptive about whether the assembly should adopt a "Cabinet" or "local government" style of internal working. That must be allowed to evolve, and it must be a matter ultimately for the assembly itself. The arrangements will therefore provide for maximum flexibility, subject to the safeguard that at least two thirds of assembly members must vote in favour of any change to the standing orders.

Part IV covers the financing and auditing arrangements for the assembly. It creates the post of auditor general for Wales, to monitor and to report on the assembly's expenditure.

Mr. Ieuan Wyn Jones (Ynys Môn)

Will the Secretary of State perhaps assure the House that, in view of what he has said, the Bill as drafted would not prevent the assembly from moving to a Cabinet system if it wished?

Mr. Davies

The hon. Gentleman's understanding is correct, but, more than that, if the advisory group were to propose a balance of arrangements as between the Cabinet and local government styles, that would essentially be a matter for the group. I would want to consider its views carefully before the representations went to the statutory commission, which would ultimately create the standing orders, so that could happen before the first sitting of the assembly, but that is a matter for consultation and for those of us who are listening. I know that the Conservative party is pressing hard on the matter, and I want to see the representations that it makes through its excellent representative on the advisory group.

When established, the assembly will become responsible for the £7 billion annual budget that is currently controlled by the holder of my office. Those moneys are allocated to Wales, principally under the block and formula rules. As the explanatory and financial memorandum makes clear, annual changes to the Welsh block will continue to be determined by the population-based formula. [Interruption.] The hon. Member for North Essex (Mr. Jenkin) is again trying to intervene from a sedentary position. The explanatory and financial memorandum makes the position absolutely clear—[Interruption.]

Madam Speaker

Order. If the hon. Member for North Essex (Mr. Jenkin) has any comments to make, he should make them at the Dispatch Box, so that they can be recorded. I do not like comments that may be pertinent and relevant being made from a sedentary position.

Mr. Davies

I am happy to allow the hon. Gentleman to intervene if he wishes.

Mr. Bernard Jenkin (North Essex)

I am grateful to the right hon. Gentleman. Is he aware of any Act of Parliament in which the explanatory and financial memorandum appears as part of that Act and can be considered by a court to be part of the law of the land?

Mr. Davies

I am grateful to the hon. Gentleman for putting his point clearly, so that we can understand it. He wants the Barnett formula arrangements to be included in the Bill. He is nodding, so at least we agree on the question. The Barnett formula is not currently enshrined in legislation. It is a practice that has been adhered to by both the last Labour Government—[Interruption.] The hon. Gentleman should let me develop the point. I might be able to help him.

That practice was initiated by the last Labour Government, continued without question by successive Conservative Governments from 1979 to this year, and it is this Government's policy to retain it. Is the hon. Gentleman saying that a question mark hangs over the continuation of the Barnett formula? If so, perhaps he should say that it is Conservative party policy to do away with the Barnett formula, if we in Wales have the. temerity to have our own local democracy. [Interruption.] I will give way to the hon. Gentleman if he wishes to pursue the matter.

My right hon. Friend the Chief Secretary—[Interruption.] The hon. Member for North Essex should listen carefully to this point, as it is one that concerns him. My right hon. Friend is today publishing a statement of principles about the operation of the block budget for the assembly and the Scottish Parliament. Copies will be placed in the Library, so that hon. Members can clearly see the principles to which the assembly will be working.

Part V covers the Community law, human rights and international obligations of the assembly. This part of the Bill also requires the assembly to make formal arrangements for its relationship with local government and the voluntary sector. It also provides for amendments to existing Acts which the Bill makes necessary.

The White Paper said that the assembly would work in partnership with local government and would promote and foster it. Those commitments are reflected in the Bill and ensure that local authorities, among other interests, will be afforded every opportunity to make a positive contribution to the way in which the assembly operates, for the benefit of Wales. The partnership will be formalised in the creation of a statutory partnership council, with equal numbers of members from the assembly and from local government.

For the voluntary sector, the Bill requires the assembly to enter into a formal scheme to cater for voluntary interests. The Government expect that a scheme to reflect the compact that my Department is currently discussing with the voluntary sector in Wales, and which we hope to conclude next year, will be specified—and the assembly's scheme will also specify how it will consult voluntary organisations and how it will support their work. There is already real co-operation of that nature between the Welsh Office and local authorities. It will be important that we are able to take forward, for example, the important initiative on tackling social exclusion that was launched by the Prime Minister this morning.

Once the assembly is established, the Secretary of State for Wales will have a continuing role to represent Wales in the Cabinet, to liaise with the assembly and to develop the important non-statutory concordats that will be the foundation for the relationship between Government Departments and the assembly. In addition, the concordats will set out the role of the assembly in the policy discussions that settle the United Kingdom line for European negotiations on matters in which it has an interest, and, beyond that, its participation in relevant meetings of officials or politicians in Europe, including the Council of Ministers.

The same arrangements will apply to both the Scottish Parliament and the assembly, and will ensure that the distinctive voices of Wales and Scotland can be heard more clearly in Europe.

The assembly First Secretary or the appropriate assembly secretary will be able, with the agreement of the lead UK Minister, to take part in the UK delegation at relevant meetings, and will be able to speak on behalf of the delegation according to the previously agreed UK line. It will be for the assembly to decide whether it wishes to operate an office in Brussels to support its work.

Mr. Rowlands

I am grateful to my right hon. Friend for assisting the House. What statutory functions, and therefore what budget, will the Secretary of State have after the transfer of functions to the assembly?

Mr. Davies

My hon. Friend might find the answer odd. Nevertheless, the Secretary of State will have the statutory functions that I currently exercise but which are not transferred to the assembly. That is the important point, but I shall ensure that my hon. Friend receives a clearer, written answer.

Responsibility for allocation of the £7 billion block grant will belong to the Secretary of State. It will be for the Secretary of State to determine what very small part of the grant remains for running the residual office of the Secretary of State, with the bulk of the grant being transferred to the assembly.

Mr. Denzil Davies

I was intrigued by the phrase "non-statutory concordats". Will my right hon. Friend explain whether those concordats will be subject to the jurisdiction of the courts, should one party to a concordat disagree with the other about its application?

Mr. Davies

No, I do not envisage that the concordats will be subject to the courts. They will be agreements that are entered into by the assembly and by the various Departments. I shall give my right hon. Friend an example, to clarify the matter. The Agriculture Council meets on a fairly regular basis, and, obviously—because agriculture is such an important function—the assembly will want to have a concordat ensuring more regular consultation and the assembly's involvement at a very high level.

The assembly will not have responsibility—the right hon. Member for Devizes will be disappointed to learn—for foreign affairs. Therefore, the concordat between the assembly and the Foreign Office will be based on a different set of principles, allowing different sets of arrangements to apply between the assembly and the Ministry of Agriculture, Fisheries and Food, and the assembly and the Foreign Office.

Mr. Lembit Öpik (Montgomeryshire)

On the same point, will the representative directly from Wales to Europe have some autonomous decision-making authority in making financial arrangements between Europe, and perhaps regions of Europe, and Wales?

Mr. Davies

I do not invite another intervention, but I am not sure that I understood the hon. Gentleman's question. The arrangements by which the representative from the assembly will take part in the discussions at a European level will be subject to the concordats that will be worked out by the assembly and the relevant Whitehall Department. Any discretion given to an individual representative—whether an assembly secretary or another representative—will be a matter for the assembly to decide. That is the purpose of the arrangements. If assembly members wish to give autonomy on certain matters to representatives to work within the United Kingdom's Council delegation, it will be a matter for them.

Part VI of the Bill begins the process of reforming the most significant Welsh quangos. Tai Cymru is to be abolished, and—under the provisions, for the first time—there will be an economic development agency with a true all-Wales strategic remit. The new agency will build on the best elements of practice and achievement of the Welsh Development Agency, the Development Board for Rural Wales and the Land Authority for Wales. I pay tribute to those organisations' considerable achievements, which include: the WDA's outstanding record in attracting inward investment to Wales; the DBRW's expertise in rural areas, which will remain a priority; and the Land Authority for Wales's commercial expertise in the acquisition and assembly of land and sites, which has made an important contribution to the regeneration effort throughout Wales. The new body will draw on the strengths of those three constituent parts.

Part VII contains general provisions relating to the Bill; and the 14 schedules to the Bill deal with points of detail.

I am pleased to say that—in line with the recommendations in the report from the Select Committee on Modernisation of the House of Commons—copies of the notes on clauses have been placed in the Library and in the Vote Office. I very much hope that hon. Members find that the notes are helpful in informing their preparation for and participation in this debate, particularly by clearly stating the intention behind each clause.

I anticipate tabling Government amendments at the appropriate time, to cover one or two issues that still need to be addressed relating to sustainable development, the precise arrangements for forestry, the role of the ombudsman, the keeping of public records and, of course, human rights.

The explanatory and financial memorandum provides for up to £17 million to meet the start-up costs for the assembly. I am sure that most right hon. and hon. Members will be aware that I am consulting on the most suitable location. The White Paper projected the annual running costs of the Assembly to be between £15 million and £20 million—in addition to those of the Welsh Office. That remains the estimate.

Mr. Tam Dalyell (Linlithgow)

Some of my constituents are involved in this matter, because they are employed at the headquarters of the Forestry Commission in Edinburgh. What is likely to be the nature of those amendments, and what changes does the Secretary of State envisage in the proposals relating to forestry in Wales, Scotland and England?

Mr. Davies

Those matters are currently the subject of discussions. I can assure my hon. Friend that there is not likely to be any diminution in the employment prospects of people working for the Forestry Commission in his constituency. We must ensure that the advantages that come from the Forestry Commission retaining an overall strategic role for forestry in the United Kingdom are compatible with our aim that it should be answerable for operations in Scotland and Wales to the Scottish Parliament and the Welsh Assembly.

Mr. Dafis

I have a constituency point, similar to that raised by the hon. Member for Linlithgow (Mr. Dalyell) because the national headquarters of the Forestry Commission—I use the word "national" rather than "regional"—are based at Aberystwyth. It is extraordinarily important that we have an all-Wales strategy for forestry with the organisational backing for it within Wales.

Mr. Davies

As I have said, we shall table Government amendments to deal with that point, and I have no doubt that there will be an opportunity at the appropriate time for a fuller debate on the matter, when the hon. Gentleman can put his constituency case.

I should like to deal briefly with the Opposition amendment. I know that the right hon. Member for Devizes and his colleagues are having some difficulty in coming to terms with their role as the Opposition, but they have plenty of time and eventually they will get the hang of it. I should like to offer them some friendly advice, which I hope is constructive. First, they need to settle on a policy, preferably one with which the Conservative party in Wales agrees. If they are in any doubt about the wisdom of accepting a new policy, I suggest that they ask Lord Wyn Roberts, the senior Welsh member of the Conservative party. He has accepted the referendum result and, like everyone else in Wales, now just wants to get on and build a successful assembly.

Secondly, the right hon. Gentleman and his colleagues should try to draft an amendment that can stand more than a passing examination. Their reasoned amendment is an insult to Parliament. At its heart, it calls for a statutory assurance in relation to the supremacy of Parliament. The right hon. Gentleman is called the constitutional spokesperson for the Conservative party, but the idea of a statutory assurance in relation to the supremacy of Parliament is constitutional nonsense. Parliament is supreme, and any statutory assurance to that effect by this or any other Parliament can be set aside by any future Parliament. It is not possible in any circumstances to give the type of assurance that the right hon. Gentleman is seeking.

Mr. Ancram

Would the right hon. Gentleman like to take advice, because he has obviously not done his homework for the debate, about section 75 of the Government of Ireland Act 1920, which is still extant?

Mr. Davies

I am happy to take advice and to read the section to which the right hon. Gentleman refers, but will he answer this central question? How is it possible for—[Interruption.] If the right hon. Gentleman wishes to engage in debate, he should do me the courtesy of listening to my question. How is it possible for Parliament to place in a piece of legislation a statutory assurance that the supremacy of Parliament will be recognised and, at the same time, prevent any subsequent Parliament from setting aside that provision? Will the right hon. Gentleman answer that question?

Mr. Ancram

I shall help the right hon. Gentleman. Section 75 of the Government of Ireland Act 1920 states that the supreme authority of the Parliament of the United Kingdom shall remain unaffected and undiminished over all persons, matters, and things in Northern Ireland. That assertion was put into the Act when it was passed and it is still extant in it. If the right hon. Gentleman wants to talk about constitutional precedent, that of 70 years is surely a pretty good precedent on which to rely.

Mr. Davies

Perhaps the right hon. Gentleman will answer this question: what is to stop this Parliament repealing section 75 of that Act? The answer is, nothing at all, which is precisely my point. Given that we have an unwritten constitution and that everyone recognises the supremacy of Parliament, his proposition that there should be a statutory assurance in relation to the supremacy of Parliament is absolutely meaningless.

Thirdly, members of the Conservative party should not pretend to speak for the interests of those whom they do not represent. The Conservative party was kicked out of Wales on 1 May, and I should have thought that a little humility on its part would not go amiss. The people have shown that they want democratic reform, and the Conservative party should come to terms with that and not continue to live in the past. The Government will work with anybody of good will who is prepared to be constructive. Constitutional change must be based on the broadest consensus.

I hope that, even at this late stage, it is not too late and that Conservative Members can drag themselves back to reality and accept the will of the people. I invite them now to withdraw the amendment: it has no basis in politics or logic. They should give the people what they want and the Bill what it deserves—an unopposed Second Reading.

I said at the outset that this was an historic event for Wales, and so it is. The Bill paves the way for a new era of democratic government and effective accountability for Wales. The Government have delivered on their commitment to the people, and I commend the Bill to the House.

4.36 pm

Mr. Michael Ancram (Devizes)

I beg to move, To leave out from "That" to the end of the Question, and to add instead thereof: this House, deploring the failure of Her Majesty's Government to respond to and allay the legitimate fears of the Welsh people expressed in the referendum vote of 18th September and in particular the omission from the Government of Wales Bill of any statutory assurances in relation to the supremacy of the Westminster Parliament, to the protection of geographic and cultural minorities, to the proper resourcing of Wales to reflect need, and to the safeguarding of the position of Wales within the United Kingdom and its voice within Europe, declines to give a Second Reading to the Government of Wales Bill. The Secretary of State—I suppose with tongue in cheek—ended by talking about consensus being part of the proposals on devolution. Everything that we have heard today suggests that his interpretation of the word "consensus" is that everyone else agrees with him. If he believes that that is consensus, he will have to think again.

The right hon. Gentleman told us that he would appoint a Conservative representative to the committee that he is setting up to advise on the Standing Orders. That is the most arrogant and patronising attitude ever heard in the House. It reminds me—I say this with measured intent—of the sort of commissars we used to see on the other side of the iron curtain, who chose not only their own ministers, but their tame opposition. He is not selecting a representative of the Conservative party; he is selecting someone who he believes will be more amenable to his way of thinking than someone proposed by the Conservative party would be.

Mr. Ron Davies

As the right hon. Gentleman has obviously taken umbrage, may I invite him to cast back his mind to a telephone conversation that he and I had in October this year? I had similar conversations with the right hon. Member for Caernarfon (Mr. Wigley) and the hon. Member for Brecon and Radnorshire (Mr. Livsey), as representatives of their parties.

I invited all three Members to come to the Welsh Office to discuss a range of matters relating to how we conducted Welsh business during this Session of Parliament. Will the right hon. Member for Devizes (Mr. Ancram) confirm his response at that time: "Until there is a Bill before us, I have nothing to discuss"?

Mr. Ancram

I confirm that I said that. I wanted an agenda of what was to be discussed, and the Secretary of State said that there was no agenda. That does not excuse his making nominations from other parties by his own hand. I find that an extraordinary way to proceed. I make it clear that whomever the right hon. Gentleman has chosen to represent the Conservative party on his committee represents only himself; he does not represent the Conservatives in Wales. He cannot represent the Conservatives in Wales because he has not been authorised by the Conservative party in Wales.

Given the right hon. Gentleman's views about hereditary peerages and their unrepresentative nature, I presume that he has not selected a member of the hereditary peerage to represent the Conservatives on the advisory committee. If he has, I suspect that he will have many words to eat. It is not the first time that this has happened, and I suggest that the right hon. Gentleman takes lessons in courtesy, statesmanship and how to be a Secretary of State from the Secretary of State for Scotland, with whom I may have political disagreements, but who, when he talks about consensus, has the courtesy and wit to try to achieve it rather than destroy it.

The Parliamentary Under-Secretary of State for Wales (Mr. Win Griffiths)

The right hon. Gentleman turned it down.

Mr. Ancram

We have never been invited by the Secretary of State to nominate someone to the advisory committee. The Secretary of State tells us today that, despite the fact that no invitation has been extended, he has made a decision himself. The Secretary of State for Scotland issued such an invitation and I made a senior appointment; I was intending to make a senior and useful appointment to the same position in Wales, but the Secretary of State for Wales has ridden roughshod over the normal parliamentary procedures and courtesies. If he is looking for consensus, that is not the way to achieve it.

Mr. Dalyell

Whom are we talking about? Some of us are in the dark.

Mr. Ancram

The Secretary of State has announced what I can describe only as a shadowy figure to be his, not my, Conservative nomination for his advisory committee. If he wishes to have an authoritative representative of the Conservative party on the committee, he has not got one, because he has not gone through the appropriate channels.

Mr. Ron Davies

In the spirit of inclusivity, let me ask the right hon. Gentleman another question. If I extend to him another invitation to discuss with me in the Welsh Office the way in which we should conduct Welsh Office business, will he accept the invitation this time, unlike last time?

Mr. Ancram

The right hon. Gentleman gave my answer for me—he spoke of when there was a Bill before us. There is now a Bill before us and I said that, if he invited me when there was a Bill before us, I would come and talk to him. I have been waiting for that invitation; I have also been waiting for invitations to make nominations to the advisory committee. The right hon. Gentleman's behaviour is totally incompatible with the democratic nature of the House.

We are being asked to give a Second Reading to a Bill whose purpose is to set up a Welsh Assembly. We are being asked quite a lot; in effect, we are being asked to endorse proposals which, in their White Paper form. struck anything but a resounding chord of assent in the hearts and minds of the Welsh people at the referendum on 18 September. We are being asked to go where three of every four Welsh electors feared to tread.

For all the Secretary of State's well-known capacity for hyperbole, which has been on show again this afternoon, nobody can deny that the outcome of the referendum was uncertain and unsatisfactory. Some 25 per cent. voted yes; 25 per cent.—only 7,000 fewer out of 1 million—voted no; and just under 50 per cent. did not bother to vote. Geographically, Wales was split almost straight down the middle, and Cardiff voted no.

The Secretary of State, clearly not a man of vaunting expectations, described the tiny majority of 0.6per cent. as a striking victory and a firm indication of support for the proposals. How he can possibly regard one in four as genuinely democratic evidence of support is hard to see, but the right hon. Gentleman has strangely eccentric views on voting percentages. He never tires of describing the 20 per cent. support for the Conservatives in Wales last May as the wiping out of the Welsh Tories; whereas he describes the 25 per cent. vote for his assembly as a triumph. There must be some extraordinary magical quotient in the 5 per cent. in between. Today, he tells us that, at 20 per cent., the Conservatives are a minority; whereas a 25 per cent. vote for the Assembly is a satisfactory majority. It is curiouser and curiouser.

Mr. David Hanson (Delyn)

Does the right hon. Gentleman recall that on 1 May this year he secured 25,710 votes out of an electorate of 80,383 which means that 69 per cent. of the people of Devizes did not vote for him? I do not deny him his right to sit in the House, but if he wishes to do so, he can take the Chiltern Hundreds today.

Mr. Ancram

If the hon. Gentleman checks the figures I think that he will find that my percentage of the vote was about the same as that achieved by the Labour Government in securing their victory with a large majority, but he will not find me questioning the validity of that election result.

Mr. Allan Rogers (Rhondda)

Does the right hon. Gentleman accept that the referendum has been held and that silly mathematical arguments do no service to the people of Wales? We have a Bill which will set the pattern of the governance of Wales for the foreseeable future, and the sooner we bend our minds to putting the right structures in place to serve the people of Wales, the better we shall be doing our jobs as politicians. We really must forget about silly mathematical arguments that are of no use; the right hon. Gentleman is doing no service to the people of Wales by carrying on in this fashion.

Mr. Ancram

The percentages were first raised by the Secretary of State. I am merely responding to the debate, as I should. I accept that a simple majority may have been achieved—[HON. MEMBERS: "It was achieved."] A simple majority of 7,000 out of 1 million was achieved, but it cannot be claimed that it reflected the settled will of the Welsh people in favour of an assembly. It demonstrated clearly the uncertainties and fears in the minds of the Welsh electorate. Those fears were recognised by the Prime Minister on the morning after the referendum, when he referred to the narrowness of the margin and the need to take account of it and to allay the fears of the people of Wales.

We might have been forgiven for thinking that we should see changes in the proposals to take account of those fears. If we did think that, we underestimated the bull-headed obstinacy of the Secretary of State, who has charged on regardless. To him, 25 per cent. is a clear, if not decisive, indication of support, and 0.;6 per cent., if not decisive, is certainly a clear majority.

Mr. Wigley

Has the Conservative party drawn up a list, which it may present at the Committee or Report stage of the Bill, of the changes that it wants to see in order to make the Bill acceptable to the people of Wales along the lines that the right hon. Gentleman is suggesting?

Mr. Ancram

Such lists normally appear as amendments on amendment papers. If the right hon. Gentleman contains himself he will see the amendments that we shall be introducing, about which I shall say a word or two later.

We have to accept that the Bill is before us, and we even have to accept the political reality that the Government can push it through, but that does not mean that we can or should endorse it in its present form. We believe that it is seriously flawed, that it addresses none of the fears expressed in the referendum vote, that it undermines the United Kingdom and Wales's position in it, that it leaves Wales's financial and European interests severely exposed, and that it entrenches permanent minorities within Wales. Without assurances on those matters—none has come from the Secretary of State today—we should oppose the Second Reading; hence our reasoned amendment.

I shall set out more fully our concerns over the Bill and the dangers that we perceive, both in terms of what it includes and what it does not include, but, before doing so, I shall make a couple of general points. We do not like the principle of what is being proposed now, any more than we did in the summer.

We still believe that the Bill signals the start of a legislative process that, along with its Scottish counterpart, will loosen the bonds that hold together the United Kingdom; it will create new tensions and animosities between the component parts of the United Kingdom, including England, which, unattended, could break the United Kingdom apart. While this Bill does not raise the English dimension as directly as the Scottish Bill, it nevertheless sets out a clear direction away from that spirit of common purpose and unity that lies at the heart of our Union.

Mr. Öpik

Will the right hon. Gentleman give way?

Mr. Ancram

No, I shall not give way at the moment, as I wish to finish this passage.

Conservative Members still believe in the Union and in the value of the United Kingdom—this unique amalgam of nations, cultures and traditions, which has proved, and can continue to prove, a significant force for good, both at home and beyond.

Mr. Rhodri Morgan

The right hon. Gentleman is in a purple patch now.

Mr. Ancram

We know the hon. Gentleman's position on the United Kingdom; it is not ours.

We will continue to fight for the Union. When it is threatened, we will respond. When it is undermined, we will seek to shore it up. However, we do not fear reform as long as it is fully thought through and consistent with the maintenance of the United Kingdom. Indeed, it is worth remembering that Conservative Governments began the process of administrative devolution to Wales and set up the Welsh Grand Committee and the Select Committee on Welsh Affairs.

We still question the need for the Bill, and we question even more the motives behind it. When it is considered alongside last week's White Paper on regional development agencies and the accompanying ministerial comments, it becomes clear that the Government regard the Bill as the first step in the regionalisation of the United Kingdom—we know that England is next in the firing line—and all in the cause of helping to create a Europe of regions. Fragmenting the United Kingdom and weakening the sovereignty of this Parliament is, and must be, a central part of that agenda. Why else would the Government radically change a constitutional structure in the United Kingdom which, by and large, works well?

I warn the House that the Bill moves us significantly closer to the Europe of regions and away from the Europe of nations. In so doing, it is inimical not only to Conservative Members but to the vast majority of people in Wales and the rest of the United Kingdom.

Those concerns will guide our response to the Bill. We shall approach it with the best interests of Wales and the United Kingdom at heart because, unlike some people, we do not believe those two aims to be mutually exclusive. We shall press the Government to address the real concerns of the Welsh people and we shall do what we can to mitigate the flaws.

We shall not seek to filibuster or unnecessarily to table amendments. If the Government are determined to proceed to an assembly, we shall want it to work in a way that is least damaging to the Union and most constructive for all the people of Wales. We will campaign hard for the true voice of Welsh Conservatism to be heard strongly within it and within consultations held in the lead-up to it. Our position in that regard has long been clear.

I am appalled at the proposal that the Bill not be taken in its entirety on the Floor of the House. I believe that it is a Bill of first-class constitutional importance. It would be an insult to all that the Government have promised to the supporters of devolution in Wales if it were not taken in its entirety on the Floor of the House. It should not in any respect go to a Standing Committee.

In the words of that great socialist, Herbert Morrison, speaking in the Procedure Committee on 18 September 1945, you cannot play about with the British Constitution in a Committee upstairs, to put it colloquially. If I may put it equally colloquially, it is not good enough to claim that a two-day Second Reading debate allows all hon. Members to have their say on the detail of the legislation. Apart from its being in questionable order for them to do so during a debate on the principle, it is impractical and unreal. The devil is in the detail of the Bill, and that detail has implications for Wales and the United Kingdom.

Mr. Ron Davies

rose—

Mr. Ancram

As the Secretary of State is about to intervene, I want to ask him a question. How do the proposals square with his press release of 27 November, the day of the Bill's publication, which stated that, during its parliamentary progress, it is, of course, also open to any MP to put forward changes to the Bill, and to have these explored in detail through open debate"? Perhaps he can explain how that can possibly happen in a Committee upstairs—or were those words simply for effect?

Mr. Davies

No. Any hon. Member may speak on Second Reading. Any hon. Member may table amendments or new clauses on Report, if there is a Report stage. Third Reading provides a further opportunity. Any hon. Member who wishes to do so may speak on Second Reading and attempt to get a place on the Standing Committee. That includes Conservative Members, but I suspect that not many of them are dying to serve on the Standing Committee. That is my answer to the question.

I have a question for the right hon. Gentleman. I do not necessarily want to negotiate on this matter across the Floor of the House, but as he has now acknowledged that the Government have the right to get this legislation, and has accepted the fact that it is his role to act constructively in seeking to improve the legislation where appropriate, will he give an undertaking that, if the Government were not minded to have the Bill considered in Committee upstairs, he would agree with the Government, through the usual channels, to have an agreed timetable to take the matter entirely on the Floor of the House?

Mr. Ancram

Obviously, I would want to see the proposed timetable.

Mr. Donald Anderson

rose—

Mr. Ancram

If the hon. Gentleman can contain himself, I am answering the question.

The right hon. Gentleman has made me an offer, and I should have thought that it was more consistent with his statement that it was open to any hon. Member to put forward changes to the Bill to discuss it on the Floor of the House. If enough time were given to allow any hon. Member who wanted to propose a change to have it dealt with on the Floor of the House, I should wish to consider that. I shall not negotiate with the right hon. Gentleman at the Dispatch Box—he would not expect me to—but I am saying that he is in serious danger of creating a dangerous precedent, which he and others might well come to regret.

Many countries require substantially weighted majorities to amend their constitution in referendums or in their legislature. For better or worse, we have relied on the scrutiny of the whole House of Commons to create a sufficient safeguard where constitutional reform is at issue. That scrutiny is to be jettisoned and the bulk of this comprehensive, if confused, piece of legislation will be relegated to a Committee upstairs instead.

It cannot be for fear of time wasting—I have dealt with that—or for reasons of urgency, given the lackadaisical timetable which, despite 18 years in the preparation, has brought us the Bill some seven months after the election and nearly three months after the referendum. Indeed, there are still amendments to come.

Surely there cannot be anything more serious than the fundamental reform of the constitution of Wales and the United Kingdom, requiring priority time on the Floor of the House. [Interruption.] I heard what the Secretary of State said, but if he does not change his mind I shall take it as an example of the arrogant contempt with which the Government in general, and the right hon. Gentleman in particular, treat the House of Commons.

Mr. Ron Davies

Is the right hon. Gentleman accusing me of it?

Mr. Ancram

Yes, I do accuse him of it. It lies four square with his patronising approach to those in the Labour party who have genuine worries about the detail of the proposals, and it tallies with his dismissive refusal to have any truck with the genuine concerns of the people of Wales about the Bill. It is a dangerous undermining of our constitutional procedures, and it cannot be justified by protestations of administrative convenience or modernised procedures. It may well make the Secretary of State's job easier, but all the procedures of the House should be not for the convenience of Government but for the good of our country and our constitution.

The Bill requires the fullest and most careful scrutiny. It is not a measure for today, which can be changed tomorrow if it does not work. Constitutional reform is not like that, and nor should it be. It is for the long term, and there is an imperative for the House to try to get it right. That description is not applicable to the Bill.

The Bill is a dog's breakfast, and is the more dangerous for it. In many ways, it is almost schizophrenic. A Bill that is designed to pass the powers of secondary legislation to the assembly leaves a staggering 45 separate order-making powers in the hands of the Secretary of State and a further 20 determinations or directions to be made by Welsh or Treasury Ministers.

In five instances, the Secretary of State's staff may be required to consult before acting, but, given the current interpretation by the Minister of Agriculture, Fisheries and Food of the word "consultation", that hardly gives any of us much comfort. The Bill as it stands is devolution subject to direction and veto: neither one thing nor the other. I shall discuss that in due course.

The Bill contains significant areas for potential conflict between Westminster and the assembly, and between the Assembly and the Secretary of State. We shall be told, and have been told again today, that those areas of conflict are more imagined than real, because there will be a new consensus style of politics, which will prevent them arising—just as, I suppose, there is in the Secretary of State's dealings with Cardiff county council about Cardiff city hall as the home for the assembly.

Long-term constitutional reform cannot be founded on wishful thinking or on best-case scenarios. Where new structures, new procedures and new relationships are being erected in a constitution, they must be tested against the hypothesis of the potential storm instead of the potential calm, against the times of disagreement instead of agreement, against, indeed, the worst-case scenario. Almost anything can be made to work in the best of all possible worlds, but that is not the world we live in or are likely to, as I suspect the Secretary of State is discovering daily the hard way.

We intend in both Houses to test the propositions in the Bill against reality, not aspiration. If devolution is to happen, it must be robust enough to withstand the economic and political storms that will inevitably occur. I believe that statement to be in line with the question that the hon. Member for Rhondda (Mr. Rogers) asked me earlier.

On reading the Bill, I was relieved to find that old habits of socialists are alive and kicking, at least in the Welsh Office. The assembly—shades of some of those wonderful old communist regimes—will have at its head a First Secretary. That is a phrase to be conjured with, and takes me back a bit. The First Secretary will preside over not a Cabinet, but an executive or praesidium. I suppose that we will be told next that the assembly, if it can be found a home, will be called the grand hall of the people—in which required reading for members will be a little book called "The Thoughts of Chairman Ron". I suspect that it will be a small book—

Mr. Dalyell

Will the right hon. Gentleman give up these silly points, and bear in mind the fact that the first First Secretary was Rab Butler?

Mr. Ancram

I am grateful for the history lesson—the hon. Gentleman's history predates mine. We could all poke a bit of fun if the matter were not so very serious. Indeed, the drafting of the Bill leaves little room for levity. It is one of the most confused pieces of legislation that I have had the misfortune to study—and there is some pretty stiff competition.

The Bill gives the impression that it does not know what it is trying to achieve. It remains unclear whether the Assembly will be just a talking shop or a body with real teeth. It remains unclear whether the Secretary of State will be reduced to a messenger or elevated to the role of Governor General. There is evidence for both propositions. It is also unclear how the government of Wales will continue in an efficient, decisive and accountable manner.

Just about the only really clear provision is that the members of the assembly will determine their own salaries and allowances. There is also a clear provision, as the Secretary of State has reminded us, to the effect that one third of the members will be elected by a closed list system—not even the open list system which the Home Secretary is studying in relation to the European elections. The system is designed to give maximum power and patronage to party leaders. We believe that both provisions are insidious and could be corrupting, and we shall oppose them.

Let us look at the contradictions. Some parts of the Bill provide for an assembly that is able only to advise, discuss and consult—that wonderful word again—yet other parts confer on it seemingly sweeping powers without the need for further legislation. For instance, clause 32 is meant to give the assembly a real role in drawing up relevant primary legislation for Westminster, and requires the Secretary of State to undertake consultation with the assembly on the Government's legislative programme. But then come the words: as appears to him to be appropriate". It goes on, amazingly, to remove the requirement to consult the assembly if the Secretary of State considers there are considerations relating to the Bill which make it inappropriate for him to do so". The whole thing is left to the subjective or political judgment of the Secretary of State: so much for the assembly.

In almost the same breath, we are told that, under clauses 28 and 29, the assembly can centralise power by assuming to itself the powers of, say, health authorities. For example, it could abolish the North Wales health authority and run it from Cardiff or Swansea: so much for devolution. Without reference to anyone or anything, the assembly could disband the Welsh tourist board, the Welsh Language Board or even the Welsh Development Agency and assume their roles itself. If the House is sceptical about that, hon. Members have only to look at clause 39, under which the assembly may do anything that is "calculated"—another weasel word—to facilitate the exercise of any of its functions. How is that for a blank cheque?

We do not even know for certain yet what functions will be transferred to the assembly from the Secretary of State or any other Minister of the Crown. We hear speeches from the Secretary of State and his Ministers about what is to be transferred, but there is nothing in the Bill about it except for a schedule of areas within which transfers of functions may be made by Order in Council, as the Secretary of State considers appropriate—those words again. A draft of the order is not even required until just before the elections to the assembly take place—another blank cheque.

The Secretary of State told us that he will provide us with a working draft in January. At last, we thought, he is beginning to see that there is some purpose in giving the House information during the passage of the legislation, but he went on to say blandly that it will not be the final draft—many other things could appear in later drafts, he said. Once again, we are being asked to sign a blank cheque. This is hardly a sensible way in which to make fundamental constitutional reforms.

Mr. Gareth Thomas (Clwyd, West)

The right hon. Gentleman is in danger of missing the point. Making the Bill too prescriptive in terms of the powers to be accorded to the assembly runs counter to the very principle behind it, which is to provide democratic accountability to match the administrative devolution that has gone on apace in Wales for the past 18 years.

Mr. Ancram

I wonder whether the hon. Gentleman has read the Bill. I am not complaining about the democratic institution of a Welsh Assembly deciding these matters; I am complaining about the Secretary of State deciding them under the 45 order-making powers that he retains under the Bill. He will not tell us what those orders will contain.

The contrast between these approaches is quite breathtaking. I had hoped that it was the result of sloppy drafting which can yet be put right—we shall see. If the assembly's role is ambiguous, the Secretary of State's is much more so. If his current functions and budget are transferred, as he said today they would be, he will have little that is positive left to do, and even less authority to do it with. It is hard to see how his position could for long continue to command a place in the Cabinet. However, other clauses giving a very different impression soon appear.

Under clauses 45, 49 and 50, far from decentralising decision making over its own affairs to the assembly, the Secretary of State reserves to himself the right to decide its original Standing Orders. He then requires an awesome two-thirds majority in the assembly to change them thereafter. That is a draconian threshold, which puts the 25 per cent. yes vote in the referendum in perspective.

There is more. Nothing in the Bill dispels the fear aroused by the White Paper that the concerns of Wales will hereafter be voiced less in the European Council of Ministers, and only at the whim and invitation of the Secretary of State. That would certainly fail the worst scenario test, and the people of Wales should know about it before it is too late.

The hon. Member for Montgomeryshire (Mr. Öpik) asked a significant question earlier, and got no response to it—not because the Secretary of State did not know the answer, although he gave a fair impression of being badly briefed, but because he knew that the answer was no. He knew, too, that if he gave that answer it would not please the hon. Gentleman or the House.

What is more, the Secretary of State will have powers under clause 107 to overrule the assembly in any way he thinks necessary to fulfil commitments to the European Union. If ever there was a recipe for conflict and resentment, this is it. Add to that the 17 orders subject to affirmative procedure, the 25 orders subject to negative procedure and a few other powers thrown in, and the picture of a Secretary of State with a whip but without a role becomes clearer. His potential as a pivot for conflict, resentment and the encouragement of nationalism is self-evident, and it makes a mockery of the claimed stability of the proposals. Then there is the right hon. Gentleman's control over money—I shall return to it in a moment.

What is certain is that these ambiguities and confusions will result in less clarity and accountability, and more bureaucracy and delay—the latter being feared by the chairman and director of the Welsh CBI, Elizabeth Haywood, who informed the Select Committee on Welsh Affairs last week: there is no economic imperative for establishing a Welsh Assembly. I welcomed the right hon. Gentleman's recognition of that fear when he launched his Bill. He must know that uncertainty is the greatest enemy of business confidence, and that the Bill is riddled with it. Entrepreneurs and investors need a system of government that they know and trust. The Bill, in all its bureaucratic muddled glory, can hardly claim to provide it.

It is from what is not in the Bill that the greatest fears arise; and it is in its failures that we find the greatest cause for concern and opposition. For a start, it fails to offer any statutory protection for minorities. The referendum showed that the Government had succeeded in splitting Wales down the middle: the north fears permanent domination by the south; the east fears bias towards the west; English and Welsh speakers fear losing out to each other. There is nothing in the Bill to safeguard the interests of minorities; without such a safeguard, the seeds of dangerous tensions could be sown.

Setting up a series of regional committees is meant as a sop to north Wales—on examination, it turns out to be a meaningless gesture. The assembly will decide how many regions there will be and will then draw up their boundaries. The regions will be only advisory in any case, and the assembly could cheerfully ignore them. They offer no statutory protection whatever.

More astonishingly, the Bill gives no assurances on finance for a Welsh Assembly, or any sign that resources will be provided to meet need. Clause 80 states only that the Secretary of State shall from time to time make payments to the Assembly out of money provided by Parliament of such amounts as he may determine". In other words, it is at his whim and discretion. If ever there was an area where it is in Wales's interests to see legislative assurance, it is here. If ever there was a candidate for the worst-case scenario test, it must be this. That is all that is said—beyond what is in clause 80, the Bill is silent. The financial future of Wales will be subject only to the discretion of the Secretary of State, who will, at the same time, have lost his clout with the Treasury. If ever there was an area of uncertainty, this must be it.

It is no good the Secretary of State protesting that the much-vaunted Barnett formula is in the financial memorandum. He knows as well as I do that such a memorandum has no force in statute. It protects precisely nothing. What are the Government's longer-term intentions? What effect will the current fundamental spending review have on the formula? What bankable assurances can the right hon. Gentleman give the people of Wales that, financially, they are not being sold a pig in a very expensive poke? In short, can he offer anything more than the fragile and potentially transient good will of Secretaries of State in the future?

I turn finally to the failure of the Bill to reassure on the vital question of the United Kingdom and Wales's place within it. None of us can know the outcome of the legislation in this regard, but we are entitled to fear it. I fear a Bill which, in clause 22, proposes that further powers be transferred from Whitehall to an assembly simply by Order in Council. I fear even more a provision that establishes that this is a one-way street and a ratchet that cannot be reversed, and which can only further distance Wales from the United Kingdom and further loosen the bonds of the Union.

I must tell the Secretary of State that even in the negotiations on the framework document on Northern Ireland, the dangers of the one-way ratchet were recognised. Paragraph 44 of the White Paper on Scotland—we have not yet seen the Bill—suggests that there will be provision for transferring further matters to and from a reserved list. Here we have a one-way ratchet, and that is something at which the House should look carefully.

To add to the confusion, clauses 43 and 44 propose that the House will no longer receive statements about secondary legislation from the assembly, although it will still be required to pass—at least for the moment—the primary legislation under which the assembly will operate. I say in all seriousness that that creates an open door for nationalist ambitions, and raises doubts about the ultimate sovereignty of the Parliament of the United Kingdom. Significantly, that is not mentioned in the Bill, although it was the focus of loud reassurance during the referendum campaign. It is not surprising that the absence from the Bill of such a measure creates suspicion, uncertainty and fear.

All that the Secretary of State has to do to allay these fears, the phrase used by the Prime Minister in Downing street, is to declare unequivocally to the House—or, better still, to table an amendment—that the supreme authority of this Parliament shall remain unaffected and undiminished over all persons, all matters and all things in Wales.

Mr. Ron Davies

Where has that been done before?

Mr. Ancram

I will tell the Secretary of State: in the only case where there has been devolution of power of this kind within the United Kingdom. I will gladly give way to the Secretary of State if he wishes to make the statement for which I ask, and I look to him to place those words in the Bill.

Mr. Davies

I have given the right hon. Gentleman a clear answer—that provision is meaningless. Will he answer my question? What is to stop this Parliament, if it wishes, repealing that measure?

Mr. Ancram

The supremacy of this Parliament means that it can do what it wishes. If the Secretary of State refers to Northern Ireland, he will see that assurances were given by the inclusion of such a provision in the Government of Ireland Act 1920 Why is he frightened of putting that phrase into the Bill by an amendment, which would merely replicate what is in the Government of Ireland Act 1920? That is a good precedent.

Mr. Davies

I am not afraid of anything. I am trying to explain to the right hon. Gentleman that I am resisting putting a meaningless provision in the Bill. He has acknowledged that there is nothing to stop any future Parliament repealing any measure passed by this or any other Parliament. Why does he not accept that a central pillar of the British constitution is that this Parliament is sovereign? Nothing that this Parliament does can bind any future Parliament. That needs no legislation.

Mr. Ancram

The Secretary of State is wriggling. If he really felt that, he would have no compunction about putting such a phrase in the Bill. He is not prepared to do it because he is frightened of a confrontation with the nationalists. He fought the referendum on the basis that, while he was telling one half of Wales that devolution would strengthen the Union, he allowed the leader of Plaid Cymru, the right hon. Member for Caernarfon (Mr. Wigley), to go around Wales talking about how it would lead to the break-up of the United Kingdom and to an independent Wales. He does not want to break up that happy friendship. Perhaps, in due course, we will help him to concentrate more closely on the matter.

We do not like the Bill. We believe it to be dangerously flawed. If it receives a Second Reading, we will seek constructively to amend it and we will look to the Government to show that they are prepared to listen to the very real fears of many people in Wales about what is being done to them in the name of devolution. The way in which the Secretary of State responds to the suggestions will be watched closely by people in Wales. I have to say that the intransigent behaviour he has shown so far does not offer much encouragement.

Above all, we will seek the reassurances that I have outlined and the responses that will fill those glaring gaps that I have outlined again, which are the cause of great concern in substantial parts of Wales. So far, the Government have ignored the legitimate fears of the Welsh people and have done nothing to allay them. The Prime Minister's words in Downing street have turned out to be worth not the breath used to deliver them; they ring hollow today.

We will not ignore those genuinely held fears. The Bill fails to assert the supremacy of this Parliament and fails to protect cultural and geographic minorities. It fails to ensure proper resourcing for Wales to reflect need, and fails to safeguard the position of Wales within the United Kingdom or its voice within Europe.

We live in hope—vain, I fear—that, even now, before the debate is concluded, the Secretary of State will climb down from his high horse and that these assurances will be forthcoming and the relevant changes will be promised. If they are not—looking at him, I fear that they will not—we will have no option, on behalf of those anxious and worried people in Wales, but to urge the House to decline to give the Bill a Second Reading tomorrow night.

5.15 pm

Sir Raymond Powell (Ogmore)

I am very pleased to be called to speak in this historic debate. The Principality has waited 18 long years for a debate on devolution for Wales. I should like to put on record the work undertaken back in the 1970s by the likes of Emrys Jones, the secretary of the Welsh Labour party; my right hon. and learned Friend the Attorney-General; Michael Foot; and the noble Lord Callaghan, who devoted their time as part of a Labour Government to trying to get devolution on the statute book as long ago as 1978.

The then Government produced the Wales Act 1978, which was rejected by 80 per cent. of the electorate, against the 20 per cent who were in favour. We worked for a yes vote in 1978 and at least we can console ourselves that our work forms the basis of the present proposals in the Government of Wales Bill; not all the present proposals, I hasten to add, especially not those dealing with proportional representation. I objected to those proposals when the White Paper was published and, as a result, subsequently voted no in the referendum.

In the spirit of co-operation and as a result of the call for unity, I hope that, if amendments are tabled, they will be given due consideration and not rejected on the basis that they might alter the spirit of the Bill. I mention that in relation to all the views expressed since 18 September. As a democrat, I accept the decision that was taken, and I appreciate that the majority was in favour.

My hon. Friend the Member for Rhondda (Mr. Rogers) has suggested that we should not go into the facts and figures, as it would be a waste of time. I do not share his opinion. A small majority voted for the proposals and, until such time as we examine in greater depth and detail the decision taken by the electorate of Wales, we might not be able to get the unity which we need and for which we are calling.

Mr. Rogers

Will my hon. Friend give way?

Sir Raymond Powell

In a moment.

The results of the vote need close examination. I shall quote figures published by the House of Commons Library. In the general election on 1 May, 75 per cent. of the electors in Wales voted overwhelmingly for Labour candidates to be returned to Parliament. Four and a half months later, on 18 September, only 50 per cent. of the electors voted on the Government's proposals on devolution. Out of 2,224,000, only 1,112,000—that is, only 50.1 per cent. of the electors—voted at all. Of the half of the electorate who voted, 559,419 voted yes—50.3 per cent. of those who voted—and 49.7 per cent.—552,698 electors—voted no. That gave the Government's proposals a majority of 6,721 yes votes, out of 1,112,000 who voted—just 6 per cent. of the total.

Therefore, we should all accept the need to aim for close co-operation. Judging from the major differences that have already erupted on the question of where the assembly will be housed, it does not seem that unanimity is being established even in these early days.

Mr. Rogers

So that my hon. Friend does not misunderstand me further, I was objecting to the Conservatives' continual carping about the validity of the referendum. We can discuss the figures and their implications privately, but if we want to do a service to the people of Wales, the sooner we get down to considering the detail in the Bill, the better we shall be serving them. I accept, as my hon. Friend says with his great experience, that we need to bring about a reconciliation, but we certainly ain't going to get it from the Conservatives.

Sir Raymond Powell

With all due respect to my hon. Friend, let me remind him that I am emphasising the need to examine the figures, and analyse who voted and who supported the Government's proposals. If we want co-operation, that does not just mean co-operation between members of different political parties or between Members of Parliament speaking in the House.

Many people outside can express their views only by reference to Members of Parliament. We are introducing legislation on behalf of the 25 per cent. who voted no, and the 50 per cent. who did not vote at all. We must consult those people and ensure that we take them with us; otherwise, we shall not do justice to the assembly that I dreamed of in the 1970s and which I worked to establish in 1978, unlike a number of other hon. Members, including some on the Front Bench, who were not with us.

I remind the House, and especially Labour Members, that one of the most prominent opponents of the Wales Act 1978 when it was put to a referendum is now a Commissioner in Europe. Four years after opposing the proposals that a Labour Government had introduced, he was elected leader of the Labour party. That shows the degree of tolerance that existed in the Labour party.

Everyone would be wise to reflect on the attitudes adopted by the then Labour Government when the Wales Act 1978 was debated. They recognised the rights of Members of Parliament to express their views and continually to amend the Bill. There was no suppression of opinions, and no threat of expulsion from the party. None of the no voters was hounded—quite the opposite. We made the main protagonist a leader four years later, and 18 years later we made one no voter at that time the Secretary of State for Wales, so comrades, friends and Members of the House, let us have a little wara teg from now on, and a little tolerance for hon. Members who express different opinions from the Front Bench, Government or Opposition.

If we are to have a Welsh Assembly such as I and others have dreamed of since the 1970s, and if only as a mark of respect for the hard work that the late Emrys Jones put into devolution in Wales, we should have a great deal more tolerance on all sides.

Dr. Julian Lewis (New Forest, East)

I welcome the close attention that the hon. Gentleman is giving to the narrowness of the referendum result, and the high proportion of people who did not vote. Will he address the point stressed by my right hon. Friend the Member for Devizes (Mr. Ancram)—the fact that, the day after the referendum, the Prime Minister emphasised that he recognised the concerns shown by the Welsh people, as demonstrated by the low majority for the proposals, yet there is nothing in the Bill to show that those concerns have been taken into account?

Sir Raymond Powell

I tend to share the views of my hon. Friend the Member for Rhondda (Mr. Rogers). We have gone through the figures and acknowledged the importance of analysing them in great depth and detail. I am a democrat, but I was disappointed by the size of the majority, as I wanted the proposals to be accepted by a larger majority in Wales, similar to the majority enjoyed in Scotland, so that we could go forward knowing that we had the support of a larger number of people.

I want devolution to be a process of which we can be proud. I want an assembly of which we can be proud, and one that embraces true democracy. I do not want what some are suggesting—one of the largest-ever quangos.

I am concerned about the numbers of the assembly. In reply to the spokesman for the Liberals, who spoke of a membership of 80, the Secretary of State said that he was opposed to that, and that he was not eager to accept any alteration. My views were expressed to the commission in the Labour party in Wales. I favour 40 men and 40 women to represent 40 constituency seats. Eighty members would be a fair number; we have had county councils in Wales with far more members than 80.

In suggesting that a man and a woman should represent each of the 40 parliamentary seats, I hoped that there would be no need for PR, and it would be a tremendous step forward in the establishment of equal rights and opportunities for women in Wales. I still fail to understand why that suggestion was rejected, and why women in Wales did not give it greater support.

Some people in Wales, including those who would stand for the assembly, have suggested that there will not be enough members to cover the committees and cope with the assembly's likely work load. I hope that the Secretary of State and the Government will consider seriously expanding the assembly's numerical strength to 80 members and allowing a man and a woman to represent each seat. There is no need to take the matter to Europe as women and men would have equal rights—the proposal does not involve short lists for women only—and we should have 40 men and 40 women representing 40 parliamentary seats and being accountable to their parliamentary constituencies. There is no better parliamentary framework in a democracy than that.

At present, it is suggested that 20 members should be appointed on the basis of proportional representation: a faceless body would appoint 20 people from a list. I see the leader of Plaid Cymru, the right hon. Member for Caernarfon (Mr. Wigley), nodding. I am concerned that PR is not the correct system for electing assembly members, but I have another fear. I have fought Welsh National party candidates in the parliamentary seat of Ogmore not only for the 18 years that I have been a Member of Parliament, but for 15 years before that. I recall the stand taken by the Welsh nationalists from the time when I was a sub-agent in Carmarthen and Gwynfor Evans was elected.

I cannot understand why this Government want to have a brotherly association with the Welsh nationalists and the Liberal Democrats, when we have a majority in this place that secures our independence. I have fought candidates from both those parties in elections, as well as those from the Green party, the Independent Labour party and many others.

Mr. Gareth Thomas

I am grateful to my hon. Friend. His comments about proportional representation have some interest in the context of the opening remarks by the right hon. Member for Devizes (Mr. Ancram), who placed great emphasis on the need to protect minorities. Does my hon. Friend agree that it would be appropriate for the Opposition to welcome that element of the proposals that will certainly preserve a minority in Wales: the Conservative party? If the assembly is to be all-embracing, it must represent all shades of opinion in Wales.

Sir Raymond Powell

I agree—of course we want the minority parties to have a place on the assembly. However, those parties must do what the Labour party has done over the years. The Labour party was in a minority position for years—if one reads the history of this place, one will see that the Liberals were in the majority for a long time. The minority parties should earn their places with the electorate—they should not just expect their members to be elected under a system that is far from democratic. Under the PR system, people may be elected using lists that are controlled by the powers that be.

I am concerned about the transfer of powers from the Secretary of State for Wales to the assembly. The transfer of powers proposed by the Wales Act 1978 is nothing compared with the current proposals. I am beginning to wonder—as one of the elder statesmen in this place and as one who might be looking forward to retiring at the end of this Parliament—what sort of Parliament we shall leave to our successors, especially those from Wales. What will be left for elected Members of Parliament to do? Is this move designed to encourage Welsh Members to stand for election to the Welsh Assembly? Perhaps it is. If Welsh Members will have no work to do in the House of Commons, they might seek a seat in the assembly.

We should have enjoyed devolution in Wales and in this country for 18 years. I regret that the electorate refused to accept it at that time. I am very pleased that a majority of voters are now in favour of an elected assembly for Wales, and I hope that it will be possible to establish that elected assembly as soon as possible.

I have received a letter from the secretary of the Cardiff city Labour group—I think that most Welsh MPs have received a copy of it—explaining in detail the reasons why that group rejected the proposal to house the Welsh Assembly in Cardiff city hall. I was a councillor in Ogwr borough, and I can understand why the group took that decision. It had every right to reject the proposal, which would have cost ratepayers £7.3 million to secure the premises. That reason must be put on the record, although argument may continue as to whether the decision is right or wrong. Nevertheless, the group has ensured that Members of Parliament are informed by sending letters detailing its discussions on the matter. I was very pleased to receive that letter, which reveals the facts of the case.

5.36 pm

Mr. Dafydd Wigley (Caernarfon)

I listened to the authentic voice of the elder statesman of the Labour party, the hon. Member for Ogmore (Sir R. Powell), with considerable interest. Given his comments during the referendum campaign, I was particularly interested to hear the hon. Gentleman express the hope that the assembly would come into being as rapidly as possible and would be a fitting tribute to the late Emrys Jones. If that is the case—I clearly accept the hon. Gentleman's comments—there is at least some coming together on the principles, if not on the details, of the proposals before us today.

I make it clear from the outset that Plaid Cymru supports the Bill and accepts it for what it is—although it falls well short of the ideal that we envisaged. However, we recognise that the Government have a mandate for the Bill as a result of both the general election and the Welsh referendum. In May this year, every Member of Parliament in Wales was elected on the basis of a party programme that supported at least this degree of national democracy for Wales. The only party that stood against any such development was the Tory party, which failed to win one seat in the general election. It ill behoves the Tories, speaking from their English bunkers, to tell Wales now that we cannot have any form of national democracy for our country.

Mr. Rogers

We live in what is probably the finest democracy in the world, and I must confess that it is very sad to hear such trite remarks about developing a democracy. I contend that devolution and other forms of government have nothing to do with democracy. The Bill has nothing particularly to do with democracy—otherwise I would ask my hon. Friend the Member for Monmouth (Mr. Edwards), through you, Mr. Deputy Speaker, how on earth he comes to be sitting behind the Minister now. I cannot see how the Bill is an extension of democracy when it negates our existence in this place.

Mr. Wigley

I listened with considerable interest to the arguments advanced by the Labour party throughout the campaign for a yes vote. They were largely based on extending democracy in Wales and getting democratic answerability for a tier of government, much of which was made up of quangos or was within the Welsh Office and not open to adequate scrutiny and answerability.

I accept that the hon. Member for Rhondda (Mr. Rogers) may have taken a slightly different view from that held by the main stream of the Labour party on this matter, but I have set out the basis on which the proposals were made and the basis on which a majority of those who voted in Wales voted yes so as to secure a better system of democracy for our country.

I pay tribute to the work of the Secretary of State and his fellow Ministers in the Welsh Office in the campaign to secure a yes vote. I pay tribute also to the work of Professor Kevin Morgan and his colleagues in the "Yes for Wales" campaign.

As for the referendum, it was a close result. Less than one hour before the outcome was known, the no campaigners appeared on television saying that, if they won by only a handful of votes, that would be enough to kill the Bill.

Mr. Ancram

The right hon. Gentleman will remember that at about that time of night, when he thought that he was going to lose the referendum by a small number of votes, he said—he was recorded on television—to me, "I hope that we can have a replay next week."

Mr. Wigley

I did indeed say that we would fight, fight and fight again to secure what we wanted. We acknowledged the validity, as did many of the right hon. Gentleman's colleagues who appeared on television on the evening of the referendum, that, if the no campaigners won by a handful of votes, that would be enough to kill the Bill.

What is sauce for the backward-looking, scaremongering, no-voting neanderthals is also sauce for the forward-looking, yes-voting alliance, which believes in democracy and in Wales. Let us recall that the turnout in Wales, at 51 per cent., was not all that much lower than the 59 per cent. achieved in Scotland. The swing in Wales from 1979 was greater than that in Scotland.

It is worth reminding the House of the post-referendum mood in Wales. Even among those who voted no there was some satisfaction at the outcome. Some of the no voters told me that, when they saw the joy on the faces of the young people of Wales at the yes vote, they were glad that the referendum had gone that way. That was a fact and that has been said. It has been said on television by a former Conservative Member in a face-to-face interview. No doubt we shall hear more about that when the debate moves to the other place in due course.

There are former Conservative Members as well as Labour doubters who now say that we must not be drawn into re-fighting the referendum. What is needed is a coming together to get the best national assembly that we can possibly secure for Wales. I appeal to Tories in England to take such a positive and constructive approach. Wrecking the Bill and giving Wales an inadequate assembly would be a great disservice to my country.

Dr. Julian Lewis

Does the right hon. Gentleman not understand that there is great concern, that when dealing with an issue of such fundamental constitutional importance as the Bill that is before us, any mandate from the people should be large and healthy? The fact that the referendum did not get a large and healthy mandate concerned the Prime Minister when he said the day after the referendum that the Government would address the concerns that had been shown by the smallness of the mandate. However, the Bill does not address those concerns. Will the right hon. Gentleman comment on that?

Mr. Wigley

If in other circumstances it had been determined that a mandate must be above a certain threshold proportion of the electorate, Bill Clinton would not have become President of the United States, Margaret Thatcher would not have been Prime Minister and most local authorities would not have had a mandate. Many such authorities have greater power than will the proposed assembly.

As for misgivings in Wales, I accept that they existed. When the Bill is considered in Committee, such concerns will have to be addressed in some detail. There will have to be exploration of the role of regional committees and other similar provisions in the Bill, but that is not an argument against giving the Bill a Second Reading and building an assembly that can bring the people of Wales together, which I believe is possible.

Mr. Denzil Davies

Is there not greater concern about the vote going in such a way that Offa's dyke could have been said to have moved westward than about the narrowness of the vote? The boundaries of Wales seem to have changed. East Wales, with exceptions, voted against and west Wales, with exceptions, voted for.

Mr. Wigley

That is an interesting point, given the fact that arguments in Wales are often presented as being polarised as between north and south. Recently, there has been an east-west divide—and not only terms of the way in which people voted in the referendum. We have seen the divide manifest itself in income per head, unemployment and many other factors. There may well have been a correlation. The highest yes votes were in the areas of greatest deprivation in Wales, both down the western side and in the old coalfield valleys, running through as far as parts of Gwent.

I shall now consider the historic context in which the debate takes place. Wales as a nation was united, incorporated and annexed into England by the Act of Union of 1536. However, Wales as a nation refused to disappear. Through our language and culture, our literature in both languages, our religious institutions and social and political values, Wales retained its national identity.

Over the past 100 years, many attempts have been made to give Wales at least some form of national democracy to ensure that our political values, manifested in the last century through the Liberal party and for a large part of the 20th century through the Labour party—I believe that Plaid Cymru is also an inheritor—are converted into practical reality in Wales.

From the 1880s onwards, there have been numerous movements to give Wales some form of national elected democracy. The Cymru Fydd movement spearheaded the campaign a century ago. I remind the Tories that in 1886 Joseph Chamberlain advocated home rule—home rule all round, including Wales.

In 1891, there was D. A. Thomas's National Institution Bill, which proposed an elected assembly for Wales. It is worth quoting the words of Tom Ellis, the former Member for Meirionnydd, and later a Liberal Chief Whip. At Newtown, in 1888, he said: Without a national assembly—at once the symbol of unity and the instrument of self government—Wales's position as a nation cannot be assured, and her work as a nation cannot be done. One hundred years later, it is in the context of that work, which still needs to be done, that we welcome the Bill.

Many Bills to establish Parliaments or assemblies for Wales have been presented to the House this century. There was the E. T. John home rule Bill of 1914, and the S. O. Davies Bill of 1954. There was the new focus on the issue following Gwynfor Evans's historic by-election victory at Carmarthen in 1966, which led to the Kilbrandon report of 1973, advocating Parliaments for Wales and Scotland.

The Labour Government of 1974 to 1979 brought forward, first, a Scotland and Wales Bill. In 1977, there was the Wales Bill that became the Wales Act 1978. The 1979 referendum shot that down. That failure left Wales vulnerable to the ravages of the Thatcher era. What a price we had to pay for that 1979 debacle. Now is the time to ensure that never again is Wales left defenceless to have imposed upon it, against its political will, a right-wing fundamentalist programme that is diametrically opposite to our social values, undermines our communities and drives Wales to the very bottom of the prosperity league in Britain.

At the very least, our own national assembly will articulate the values that we hold as a people: it will be a bulwark against imposed dogma of the Thatcherite kind. When I say "as a people", I mean all the people of Wales. We regard all the people who live in Wales as citizens of Wales and all are equal irrespective of race, creed, colour or language. Plaid Cymru is a national party, but our nationalism is a civic nationalism. It is an inclusive philosophy, and we welcome the inclusive nature of the Bill.

We want a national assembly in which all aspects of Welsh life are properly represented, including the ethnic minorities and disabled people, all the regions of Wales, both rural and industrial, and all parties including the Conservative party. In particular, we want a proper gender balance at the assembly.

Mr. Dalyell

I have always understood the right hon. Gentleman's argument for independence, but will he confirm that, had the Wales Act 1978 come into force, it would in no way have defended Wales against Mrs. Thatcher?

Mr. Wigley

We would, of course, have preferred the assembly envisaged in 1978 to have had the full law-making powers that Scotland would have got, and which it is now getting in its Parliament. However, I believe that the will of the people of Wales, articulated through the vehicle of an assembly, would have had considerable force with the way in which policies were implemented in Wales. It could not have been ignored. It would have been worth having, although it would not have given a guarantee. To that extent, the hon. Member for Linlithgow (Mr. Dalyell) is right. I shall deal with that point in the context of our proposals later.

Plaid Cymru recently adopted a formula to try to achieve a gender balance in the assembly. I hope that other parties will do likewise. I am concerned that the 40 plus 20 formula will not provide adequately balanced representation, but we can no doubt tackle that in Committee.

There are four reasons for a national assembly: first, to secure better answerability for the Welsh Office, which has grown to cover most domestic portfolios; secondly, to provide better answerability for the quangos and, preferably, better democratic control or integration into a direct democracy system—they have grown out of all recognition in the past 20 years in Wales; thirdly, to provide Wales with a stronger profile in Europe; fourthly, to provide a stronger strategic approach, on an all-Wales level, in line with Welsh political values.

I spoke earlier of the need to protect Wales and to advance our social policies to fulfil Wales's aspirations for a fair, egalitarian community. We do not believe that that can be achieved without law-making powers. That was the point made by the hon. Member for Linlithgow. Scotland is to have those powers; Wales is not.

If a Tory Government come to power in London in five or 10 years' time, the Scots will be able to protect their education system, health service, housing policies and agriculture by virtue of having their own legislation. Wales will not; to that extent, the hon. Member for Linlithgow is right. Wales will be at the mercy of the Tories in London in a way that Scotland will not. It is imperative that our national assembly has full law-making powers at least over those matters.

It is ridiculous that, with our own national assembly, if we needed to amend the Welsh Language Act 1993 or the Local Government (Wales) Act 1994, which deal with Wales alone, we would still have to come to Westminster. Such amendments should be provided through our national assembly. The Secretary of State has said before—he repeated it this afternoon—that devolution is not a one-off event, but a process. I welcome that statement. I hope that the Bill can be seen as strengthening that movement and that there will be provisions in it to reflect that aspiration, so that at least some primary legislative powers can be transferred to the Welsh Assembly in due course. Had such law-making power been in the White Paper at the time of the referendum, I believe that the vote would have been a substantially greater yes.

Mr. Nigel Evans (Ribble Valley)

On what the Secretary of State said earlier, does the right hon. Gentleman accept the supremacy and sovereignty of this Westminster Parliament, even with the Welsh Assembly and the Scottish Parliament?

Mr. Wigley

I accept what the leadership of the Conservative party said before the general election and what the leadership of the Labour party has said: that, if the peoples of Wales and Scotland determined through referendums that they wanted assemblies, Parliament would deliver them and that the Conservative party would not scrap an elected Welsh national assembly or Scottish Parliament without a subsequent referendum. That is a de facto recognition of the right of the people of Scotland—of the claim of right, as it is defined in Scotland—and of the people of Wales to take those decisions.

I am not a great devotee of 19th-century sovereignty. I believe that sovereignty does not exist only in one place. It comes from the people upwards, and should be aggregated at different levels for different functions. That is why I have no difficulty in recognising that some decisions must be taken at European level and that some sovereignty should be transferred for that purpose, as was done by the Thatcher Government. However, where sovereignty can be exercised at an all-Wales level, it should be.

Technically, it is a tradition here at Westminster that sovereignty comes from the institution, but as a democrat I believe that sovereignty—or any rights or legitimacy that we have—comes from the people. My hon. Friend the Member for Ynys Môn (Mr. Jones) hopes to speak tomorrow on developing proposals for a fast track to present our legislation to Westminster.

Another dimension of the Bill relates to links between Wales and the European Union. The Secretary of State gave a commitment when the White Paper was published—I was glad to hear him repeat it this afternoon—that our national assembly in Wales will have as full and equal a right as the Scottish Parliament in getting a voice in the European Union. Paragraph 3.46 of the White Paper states: Wales needs a strong voice in Europe. The Bill does not appear to achieve that, but perhaps it will be achieved outside the framework of legislation. If so, we welcome it.

The White Paper also states: The Assembly will take over the Welsh Office's responsibilities for administering the European Strategic Funds". The Bill does not appear to provide that. Perhaps the Minister could clarify that in his reply.

We want the Ministers, or Secretaries as they will be known, of our national assembly included as of right in the UK delegation to the Council of Ministers when issues within the assembly's competence—such as agriculture, which is in our minds because of the current crisis—appear on the agenda.

Mr. Denzil Davies

Does the right hon. Gentleman suggest that a member of the assembly should sit in the Council of Agriculture Ministers?

Mr. Wigley

Yes. From the assurances given in a Scottish context, I believe that the Scottish Agriculture Minister would be entitled to sit side by side with the UK Agriculture Minister in the Council of Ministers. Given the assurance that Wales will be treated equally with Scotland in that matter, I expect the Secretary of the Welsh Assembly with responsibility for agriculture to be part of the delegation when agricultural matters that have an impact on Wales arise in the Council of Ministers in Brussels. That is the spirit in which I took the statements made in the House today and on previous occasions. That is important for Welsh farmers.

Mr. Dalyell

The right hon. Gentleman's statement is news to us. As far as I know, there has been no assurance that Ministers responsible to an assembly in Edinburgh could speak in the Council of Ministers for the whole of the UK. Is he sure that such assurances have been given?

Mr. Wigley

I did not use that term. I did not say that the representative of the Welsh Assembly or Scottish Parliament could speak on the behalf of the whole UK, but that he could be part of the UK delegation, side by side with the UK Minister. There is a difference between what the hon. Gentleman said and what I said. I am sure that he recognises that. It is an important right that there should be a direct link from the Scottish Parliament or the Welsh Assembly to the team in Brussels when vital matters that are their responsibility are discussed.

Mr. Jenkin

We all understand the right hon. Gentleman's aspiration that Wales should one day have an independent voice in the Council of Ministers. Realistically, with the UK being the signatory to the treaty and being entitled only to one representative at the Council of Ministers to exercise 10 votes—or no votes—Welsh or Scottish representatives would attend as flunkeys with the permission, or at the invitation, of the UK Minister, or not at all. The idea that the Welsh or Scottish representative could attend as a peer or equal of the UK Minister leads the Welsh people up the garden path.

Mr. Wigley

At the Council of Ministers, a policy advocated at European level may be equally acceptable and relevant to England, Scotland and Wales or be acceptable to one part and not the others. if an agricultural policy is acceptable, say, in East Anglia but not in Wales, it is right and proper that we should have someone there to articulate that, even within the UK team. I would much rather we had a full seat in the Council of Ministers, but it is better for us to have someone there who can at least prod the United Kingdom Minister and say, "Hey, we have these requirements," than for us to have no one at all. To that extent at least, I see this as a step forward.

Mr. Rowlands

Clauses 105 and 106 explicitly state that all Community obligations are binding on the assembly, although the assembly may disagree with those obligations profoundly. Does the right hon. Gentleman accept clauses 105 and 106?

Mr. Wigley

Of course I do—and, as the hon. Gentleman no doubt accepts, the Community obligations are equally binding on the House.

We believe that the assembly should have the right to an appointee in the new United Kingdom permanent representation office in Brussels—UKREP, as it is called—and the right to determine priorities for European funding allocated to Wales. The White Paper said that that needed to be spelt out more clearly during the Bill's passage and I hope that assurances will be given in the winding-up speech. The White Paper also said, in paragraph 3.53, that the Bill would provide for members of the assembly to represent Wales on the Committee of the Regions. I do not see exactly where the Bill deals with that but, if I have missed the reference, it will doubtless be pointed out to me.

Time is passing, so I shall deal only briefly with a number of other issues. One relates to the statutory committees proposed in part III. We do not consider a local government-type committee system appropriate or adequate for our national assembly: it would be too slow and too cumbersome, it would avoid ministerial responsibility and it would be open to abuse. The assembly's Secretaries must be given the power of ministerial responsibility. It is fine for them to be accountable to a subject committee, but we believe that the so-called executive committee must operate as a Cabinet and take responsibility along those lines. If that does not happen, there is a real danger that the assembly will degenerate into a talking shop. We shall return to the issue in Committee, and I welcome what the Secretary of State said about the facility offered in the Bill for progress in that direction.

May we have confirmation that clause 73 gives powers for the establishment of committees fully analogous to our Select Committees, and that the authority of those committees to call people to appear before them will be equal to that of Select Committees so that they can do a similar job? As for clause 75, might it be possible for Welsh MEPs, when appropriate, to attend assembly committees—although, obviously, not to vote? At the very least, could they be part of the partnership council that is proposed in clause 110?

How will quangos such as the revamped Welsh Development Agency be answerable, and will the same pattern apply to all quangos? May we also have clarification of the intention of clause 22, relating to exactly what powers can be transferred from London Ministers to the assembly? I listened carefully to what the Secretary of State said earlier, but I have some difficulty in regard to schedule 2. It maps out the areas that are open to transfer, but it does not deal with matters such as disability policy and the police. Unless there is a facility for amending the schedule by order, I do not think that it will be possible for it to be applied to matters that are not currently covered by it.

Schedule 2 contains interesting anomalies. It includes culture, but does not include heritage; it includes industry, but does not include trade; it includes training, but does not include employment; it includes water, but does not include natural resources. I hope that, either tonight or tomorrow, we can hear some explanation of how the mechanism will work.

I am sorry that the assembly will be entirely dependent on the Secretary of State for both grants and loans. The denial of any tax-varying or independent borrowing power takes a fundamental responsibility from the assembly, which will have less financial autonomy than a parish council.

We in Plaid Cymru believe that all the taxes raised in Wales or on behalf of Wales should be channelled through a Welsh treasury department, but that clearly goes beyond what the Government have in mind. We need some assurance, in the Bill or outside it, about the Government's intentions in regard to the Barnett formula. We need to know that in future Wales will have a more generous deal than that formula has provided in recent years. [Laughter.] Conservative Members laugh. It may well be that they do not want Wales to have a better deal, but they will know that independent studies undertaken in Cardiff university have shown that Wales is missing out under the Barnett formula. Other areas may not be missing out, but Wales is.

I shall deal briefly with the unnecessarily vexed question of the assembly's location. We had expected it to be located in city hall, Cardiff—a dignified building worthy of a national assembly and convenient for the Welsh Office civil service. For a Labour-controlled council in our capital city deliberately to frustrate a Labour Secretary of State prompts the question whether Cardiff really wants the assembly at all. If it does not, let there be no doubt that plenty of other places in Wales do: Caernarfon, Wrexham and Aberystwyth would give their right hands for it. I am particularly impressed by the positive moves made by Swansea council, but if the assembly meets outside Cardiff there should be no doubt of the far-reaching implication of such a move. It would, in practice, create a new administrative capital for Wales, which would in due course require the relocation of the Welsh Office and other Government offices.

It would be nonsense to have a European-type farce of civil servants serving committees having their papers moved in packing cases between Brussels and Strasbourg. Those services need to be in one location. The assembly should either be located in Cathays park, where it can be serviced conveniently—city hall is our preferred option—or leave Cardiff altogether. I am amazed at the narrow, selfish, blinkered view of Cardiff council, which is a disgrace to Wales.

I remind Cardiff's civic leaders of an old Welsh proverb: A fo ben, bid bont", which means, "He who wishes to be the leader must also be the facilitator." If Cardiff wishes to enjoy the benefits of being the capital city of Wales, it must take its responsibilities towards Wales seriously. If it does not, so be it: plenty of other places are willing not only to house the assembly, but to serve Wales as her administrative capital.

I wish the Bill a speedy passage, albeit—I hope—in a strengthened form. We as a party will play a constructive role in considering it and as elected members of the assembly in due course. Our objective is to achieve the strongest and most effective national assembly for our country. We hope that that will lead to Wales taking an ever increasing responsibility for her own life and playing an ever greater role in the emerging united Europe. The assembly, however, will ultimately be judged according to the benefit that it brings to the ordinary people of Wales—the practical day-to-day benefit. It is our duty to create a national assembly for Wales that is worthy of their support.

6.7 pm

Mr. Donald Anderson (Swansea, East)

I am delighted to follow the constructive good wishes expressed by the right hon. Member for Caernarfon (Mr. Wigley) on behalf of his party. I expect similar good wishes from the hon. Member for Brecon and Radnorshire (Mr. Livsey) on behalf of his party, joining the coalition of view that narrowly won in the referendum in September. It is sad that that group was not only not joined, but actively opposed—and remains actively opposed—by the Conservative party, whose spokesman this evening, in respect of Wales, offered a hymn of praise in favour of the status quo: no more, no less. The Conservative party is ready to oppose every innovation until it becomes a tradition, as it did in respect of the Welsh Office and the Welsh Development Agency.

This is an historic Bill, and an historic time. I welcome the proposals, and do so with a certain humility, as I was one of those who opposed—for other reasons—the proposals advanced in the 1970s, when I might have been designated a Cymru-sceptic. I have, to some extent, changed sides with my hon. Friend the Member for Ogmore (Sir R. Powell).

I accept that the charge will inevitably come over a period. This is the start of the process, and ultimately we will have to move to a quasi-federal system through devolution in England as well as in Wales and Scotland.

I want to make three points, the first of which stands on its own. The key decision on whether to have an assembly has now been taken by the yes vote in the referendum. It was taken by the people of Wales in a free vote. We respect that vote, as we would have done had it narrowly gone the other way. Had there been a slim majority against the Government's proposals, the Bill would not have come before the House. Such an opportunity arises once in a generation. One vote is enough. I concede that the narrowness of the majority imposes certain constraints on the Government, but I commend the Secretary of State's approach. He has accepted that there are constraints on his proposal.

The arguments and hesitations prior to the referendum must now be put in the context of the yes vote. I am wholly disappointed by the negative response of the Conservative party in Parliament. It has an "attitude problem" with the assembly. The proper response would have been to accept the decision taken by the people in September, and to try to improve the Bill at the edges in conformity with Conservative principles.

I was particularly irritated at Welsh Question Time last Wednesday by the narrow and cheap points made by Conservative Members. The right hon. Member for Bromley and Chislehurst (Mr. Forth) talked about the taxpayers of Wales being expected to pay ever-increasing amounts to prop up the Secretary of State's incompetence. The hon. Member for Congleton (Mrs. Winterton) referred to the assembly as a job-destroying and expensive bureaucracy"—[Official Report, 3 December 1997; Vol. 302, c. 337–42.] and the hon. Member for Aldridge-Brownhills (Mr. Shepherd) said that 75 per cent. of the Welsh electorate had voted against the proposal. We could make the same cheap points about the elected dictatorship in 1983, 1987 and 1992, when the Conservative party was elected with 42 per cent. or 43 per cent. of a 70 per cent. turnout, which is just under a third of the total electorate. That did not prevent the Conservative party from introducing the poll tax and other measures at that time.

The people of Wales had the opportunity in the referendum to express their view. They voted in favour of an assembly, and we should take the Bill further in the context of that positive vote. I am irritated by the patronising, insulting and shallow view of the Conservative party in Parliament. It is only fair to add that I do not find such a patronising and shallow response from members of the Conservative party to whom I speak in Wales. Indeed, there has been quite a substantial sea change.

Over the weekend, I talked to a senior Conservative in Wales, who told me that he and his colleagues are actively preparing for the elections. That is a different, a positive, approach, and a recognition of the result of the referendum and the fact that we are now operating in a new context.

Dr. Julian Lewis

Does the hon. Gentleman accept that to oppose the creation of an assembly in principle while preparing to fight the election, given that it will happen, albeit wrongly in our view, is a consistent approach to take?

Mr. Anderson

The principle of having or not having an assembly was decided not by us, but by the people in the referendum. Once that major step has been taken, everything else is detail, and we can have a proper debate on the detail in Committee.

Mr. Swayne

The hon. Gentleman suggested that the Government have been placed under certain constraints by the narrowness of the referendum result. How are those constraints expressed in the Bill?

Mr. Anderson

I can give the hon. Gentleman a catalogue of examples. Had we been triumphalist and said that the majority that we won on 1 May entitled us to write the Bill as we liked, it is conceivable that we would not have adopted a system of proportional representation, which may bring the Conservative party back to life in Wales, given that it was chased out of Wales at the last election. That is one of the greatest acts of political generosity by a party that believes that a moribund corpse of the Conservative party in Wales is bad for democracy. The Conservative party had 20 per cent. of the votes in the election, but has no seats in Wales. We are trying to help because we are democrats: we are not being triumphalist.

Another example of my right hon. Friend's inclusive approach is the establishment of a commission, the chairman of which—I shall choose my words carefully—has never been known as a Labour supporter. I support that inclusive approach. One of the great advantages of Wales is its diversity. The Bill ensures that there is a statutory obligation to have a committee for north Wales and other committees throughout Wales. I could go on, but I shall not, because time is short. I ask the hon. Gentleman to consider objectively the way in which my right hon. Friend has most commendably responded.

Secondly, the assembly could be a mechanism for binding the people of Wales together, and a focus for Welsh identity. Reference has been made to the identity of Wales within the European Union. May I add a smaller footnote: hon. Members may not know that the Welsh Assembly will be able to become a full member of the Commonwealth Parliamentary Association, because it will have legislative powers. I have taken legal advice, and I am told that the Scottish Parliament and the Welsh Assembly will, if they so wish, be members of that association, which will be another interesting way of boosting and endorsing Welsh identity.

I fully appreciate the spirit of the Government's approach: it is not triumphalist, but objectively based on democracy and consistent with our Welsh traditions.

Mr. Jenkin

The hon. Gentleman was pressed by my hon. Friend the Member for New Forest, West (Mr. Swayne) to give examples of the restraints that have been imposed on the Secretary of State and which he has accepted, because of the narrowness of the referendum result. The first example he gave was the Secretary of State's adoption of a system of proportional representation instead of the first-past-the-post system, but that proposal was in the White Paper. The second example was the membership of the commission appointed by the Secretary of State to advise on Standing Orders, but that is also in the White Paper, which says that it will include: representatives of each of the main political parties in Wales". The Secretary of State has not given one breath of a concession in recognition of the fact that the majority in the referendum was minute.

Mr. Anderson

First, I should have said that we should look at the advisory committee. Secondly, the issue of location has been opened for discussion by the Secretary of State through the consultative document that was issued on Thursday. The system of proportional representation may with one leap bring back from the dead the Conservative party in Wales. I shall give some of my reasons for supporting that proposal. I sent a memorandum to Labour's commission on precisely the lines that were accepted.

To have more than 60 members would give rise to a negative reaction in Wales, because it would be said that there were too many legislators. We need a system of voting that is known to the electorate: hence the use of Westminster seats and the current European seats. The Westminster base will provide a link with constituencies. Perhaps most important is the fact that the number of assembly members coincides exactly with the number of seats in Swansea guildhall.

Mr. Ron Davies

Perhaps I could clarify the genuine point that was debated between my hon. Friend and the hon. Member for North Essex (Mr. Jenkin). In the White Paper we proposed a statutory commission. Of course, that cannot be created until after Royal Assent, which will be in July next year. To ensure a proper process of consultation between now and Royal Assent, I have created the advisory committee, which will be representative of all interests in Wales. It is not in the White Paper: it is an innovation and a genuine attempt to find a broader base on which to construct the working arrangements and the standing orders. It is in addition to the consultation that the Welsh Office is undertaking with all interests in Wales. We are consulting the Welsh Local Government Association, the Wales Council for Voluntary Action, the CBI, the Institute of Welsh Affairs and the Green Alliance. The genuine process of consultation goes far beyond anything that was envisaged in the White Paper.

Mr. Anderson

I am pleased to have that clarification from my right hon. Friend. The proof of the pudding will be in the working out of the proposals. [Interruption.] I do not know why the hon. Member for North Essex (Mr. Jenkin) is waving a piece of paper.

Mr. Öpik

Does the hon. Gentleman agree that the consultation process was going on before the general election and for some time before the publication of the Bill? It is more constructive to comment inclusively rather than to engage in the destructive criticism that tends to come from the official Opposition.

Mr. Anderson

I am convinced that Moses Ron did not bring the tablets of stone down from Plynlimon, send them to the House and then leave them. The process is inclusive and it is wholly consistent with the spirit of diversity in Wales. Thus Hiraeth is not longing for Wales but for one's own locality. People who go to parties in Wales are never asked, as they would be in England, "What do you do?" as if one's identity is in one's job. People are asked where they come from, because the essence of our identity is the local area from which we come. That is a far more human response.

It is not only in structures but in policies that we look for something different in the assembly. Who can doubt that, if the assembly had been in existence for some years, we would not now have a system of communications in Wales that makes it difficult to move from north to south? I am sure that members of the assembly when they meet in different locations will see at first hand the problems that are encountered in moving from one part of Wales to the other. Thus transport priorities will be different.

There is another policy that I hope that the assembly will change. I hope that its members will set their minds against the centralisation that was a feature of Conservative government in the 1980s and beyond and which allowed such a concentration of resources in Cardiff and the south-east. We were under the satrapy of the right hon. Member for Wokingham (Mr. Redwood). At one time the Cardiff Bay development corporation received £52.5 million a year in grant aid but less than half that amount went to the Welsh Development Agency for the rest of its area.

There are enormous distortions of expenditure. For example, on 21 November in a written answer, my hon. Friend the Member for Clwyd, West Mr. Thomas) was informed that over the past three years there was £376.4 million publicly funded capital expenditure in Cardiff. That is a distortion, and it arose because decisions were taken by a Secretary of State who was not seriously accountable to Wales. Such distortion will not occur in future, because people from different parts of Wales will be in favour of a far greater balance of development.

Thirdly, the location of the assembly can also fulfil the same need for diversity in Wales. In setting up the assembly we do not want to substitute one form of centralisation for another. We must be wholly in tune with subsidiarity. For the Conservative party, European subsidiarity stopped at London. We shall ensure that it does not even stop at Cardiff but extends to other parts of Wales.

I make no comment on the reasons for Cardiff council deciding not to proceed with the offer of the city hall. Happily, as a Swansea boy, I have no responsibility for Cardiff city council. However, its decision opens the debate—hence the consultative document. Decentralisation would have enormous practical and symbolic importance. It is not necessary to have the assembly in the capital city. It is certainly no longer necessary because of technical advances. I naturally make the case for Swansea guildhall, which by some happy chance has 60 seats in its council chamber. That number was in the memorandum that I sent some months ago to the Welsh Labour party, although I did not think at that time that the assembly would not be in Cardiff.

Swansea guildhall, in conjunction with Mold, Aberystwyth and Cardiff, is by far the most cost-effective option. I look forward to the Secretary of State saying to the people of Wales, "Look, we said that the cost would be £17 million, but we have managed to save a great deal of money, and the savings from that cost-effective option will be used for education and health."

I remind my right hon. Friend of the letter from Swansea's chief executive to him on 2 December which effectively states that we in Swansea will not be beaten on cost. It states: At the present time the advice of our respective Estate advisers is that the leaseback to the Council would be £60,000 p. a. resulting in a net rental cost for the Assembly of £340,000 p. a. The chief executive repeats the key point when she states: we would be happy to negotiate other arrangements, either freehold or leasehold, for the Assembly's tenure of the Guildhall. The letter goes on to say that they have set out to match the vision of their forefathers who, amongst many other achievements, bequeathed us the magnificent Guildhall building…Having tested such a wide range of local opinion, we have come to the view that in financial terms we should seek no more from you than the net rental figure set out above. In other words, the broader economic and democratic benefits of locating the National Assembly in Swansea would be full justification for absorption of any consequential costs to the Council". I will not set out the importance administrative, historical, cultural and economic case for Swansea.

For Cardiff, it would not matter all that much if the assembly were to be sited in Swansea. For Swansea and the rest of the west Wales councils that have supported its location there, it would be earnest proof of the Welsh Office's intention to decentralise. I believe that the Secretary of State accepts that there has been an enormous distortion of investment in south-east Wales. To locate the assembly in Swansea would be a counter-magnet, something that, in terms of public investment and public symbolism, would move the focus a little further west—to the boundary of, dare I call it, Welsh Wales and English Wales and to the region that actually voted for the assembly.

Over the weekend, I gained some idea of the enthusiasm in Swansea for the project. On Friday, I was at the prize giving of the Swansea Institute of Higher Education at Swansea's guildhall. When the acting principal mentioned that the guildhall could be the site of the assembly, there was an enormous roar of approval. On Saturday afternoon, I was with young Labour in the streets of Swansea collecting signatures. Generally, there was an enormously warm response to the idea.

I can therefore truly say to my right hon. Friend the Secretary of State that there would be a whole-hearted and enthusiastic welcome from Swansea if the assembly were to be sited there, with committee meetings elsewhere in Wales. It would be against the prevailing trend of putting everything in south-east Wales, and it would be an enormous and welcome millennium project for the city and for south-west Wales.

6.31 pm

Mr. Richard Livsey (Brecon and Radnorshire)

I welcome the opportunity to speak on the Bill. I gladly follow the hon. Member for Swansea, East (Mr. Anderson), who, with enthusiasm for his city, shows that there would be a warm welcome if the assembly were located there. They are welcoming people in Swansea, and I understand why he said what he did. Only time will tell whether his party will sort out the problems of the assembly's location. Cardiff has strong claims, but the argument cannot go on for ever.

The assembly is an historic milestone. The referendum vote was historic, and I congratulate the Secretary of State for Wales, his team and the "Yes for Wales" team on delivering that vote. We all contributed to it in a spirit of co-operation, and we are pleased about that.

The Conservatives would like a re-run of the referendum. They want to turn the clock back, but even in the town of Presteigne in my constituency, which is just 500 yd from the Herefordshire border, when an enterprising person put up on his shop window a list for people to sign saying, "We wish to see a re-run of the referendum," only 12 people did so. If only 12 people signed a list in Presteigne, what hope have the Conservatives in the rest of Wales?

Conservative Members have said various things about the validity of the referendum, but only 43 per cent. of the electorate turned out to elect the hon. Member for Beckenham (Mrs. Lait) in the by-election the other day, and only just over 50 per cent. of the Conservative party's membership elected its present leader—the first time that the party's membership has been involved in a party leader election. I remind Conservative Members of a person who used to sit on the Liberal Benches—a certain Winston Churchill—who returned to Conservative ranks and said that one vote was enough. That is what history tells us.

Dr. Julian Lewis

I shall try for the third time to make the point that hon. Members in other parties are avoiding: there is a difference between an ordinary vote and a vote on a major constitutional issue. We keep hearing this fudge that concessions are being made to acknowledge the smallness of the majority, but no one has made any concession acknowledging that point.

Mr. Livsey

I did not notice the hon. Gentleman making determined efforts to put a clause into the Referendums (Scotland and Wales) Bill to create a threshold, so ensuring that the principle that he is advancing now was part of the referendum. As he failed to do that, his argument falls flat on its face.

Like many Welshmen, I have worked outside my country. In the late 1960s and early 1970s, I worked in Scotland. A pamphlet was produced at that time, which said in the introduction: Our standpoint is certainly Tory. We are convinced that a measure of devolution to Scotland of power over her domestic affairs is essential. In every meaningful sense except the exercise of control over her internal affairs, Scotland is a country: to apply the current jargon of 'region' is inaccurate. It went on to say other things that basically favoured devolution. At the end, the pamphlet stated that one of its authors was a certain "Michael Ancram".

I remember that well, because I was the Liberal party candidate in Scotland contesting the Perth seat. Views have changed over the years—the Conservative party's constitutional spokesman now opposes the creation of a Scottish Parliament and a Welsh Assembly. During the referendum campaign, the right hon. Member for Devizes (Mr. Ancram) told the Scots that the Scottish Parliament had too much power, but when he was in Wales, he told us that the Welsh Assembly needed more. There was a counterpoint to that argument.

In discussing the Bill and in debating it in Committee, we have a great opportunity to get it right for Wales. I make no apologies for making remarks that may be slightly critical of certain aspects, but they are made in the spirit of co-operation and to achieve an assembly that is fair, democratic, just, free and united. I am sure that the forebears in my party, including Lloyd George and Gladstone, and Tom Ellis, leader of Cymru Fydd, whom the right hon. Member for Caernarfon (Mr. Wigley) mentioned, were all in favour of a Welsh Parliament.

During this century, we have seen the creation of the Welsh Office, the appointment of a Secretary of State for Wales and the gradual strengthening of government in Wales. Now is the time to give Wales true democracy. We want to unite English and Welsh speakers, rural and urban Wales, and poor and middle-income families in Wales—there are not many really rich people in Wales. We want to unite women, craftspeople, educators, farmers, miners, entrepreneurs, teenagers and all other sections of society.

Over the years, it has been the Conservatives' tactic to divide and rule. That has been their stock in trade, but references to fear—and they are contained in the reasoned amendment—do not work any more on the people of Wales because, at the referendum, diversity was proved to be our strength. During the referendum campaign, the people of Wales came of age, because they co-operated with each other and did not listen to the campaign of fear that was directed at them.

I should like to make a general point. The way things are set at the moment, in 1999, we shall have Welsh Assembly, county council and European Parliament elections. I ask the Secretary of State to consider the possibility of delaying the county council elections for one year, to the year 2000. It has been done before, in 1973–74. It might be a better and more constructive way to proceed, so that there is a proper concentration in 1999 on the assembly elections and then a proper concentration in 2000 on the county council elections. Clause 3 relates to community councils.

Clause 4 relates to the electoral systems. The Liberal Democrats welcome the introduction of proportional representation for elections to the Welsh Assembly. We note that 40 seats will be under the first-past-the-post system and 20 under the additional member system. I agree with some of the Opposition's comments about open lists. That possibility should be examined in Committee, as open lists have a considerable amount going for them.

Mr. Ron Davies

The debate on open lists was raised in the context of the European elections. There was an argument that electors had the opportunity to cast only one vote, so there was some criticism that they would be coerced into voting for the party rather than having the opportunity to vote for a preferred candidate within the list. I understand that argument as it relates to the European elections.

However, with the assembly elections, people will not be coerced into voting only once, because they will have two votes. They will be able to vote for their preferred candidate under the first-past-the-post system, so it is not unreasonable—[Interruption.] If the right hon. Member for Devizes (Mr. Ancram) wants to play a constructive part in the debate, he should enter into the spirit. I am trying to explain an important point. If the right hon. Gentleman wants to raise questions about how parties select candidates, I shall be happy to debate that with him later.

I can tell the hon. Member for Brecon and Radnorshire (Mr. Livsey) that, with the elections for the assembly, it is not unreasonable to expect electors who will be able to vote for the candidate of their choice then to vote for the party of their choice, because that is the basis on which the additional members for the wider constituency will be calculated.

Mr. Livsey

I understand where the Secretary of State is coming from, but it is possible to have various members on an open list from different wings of a political party, on which the electorate might like to pronounce. It gives them more freedom of action when they vote under the additional member system. We must investigate various aspects of that in Committee.

Has the Secretary of State considered getting the Electoral Reform Society to examine the system of proportional representation for the Welsh Assembly? It might have some constructive comments to make.

When referring to my former colleague Alex Carlile, who represented Montgomery, the Secretary of State said that, if the outcome of the first assembly election was not as proportional as was thought to be fair, there might be a possibility of altering the system. There is also the possibility that the right hon. Gentleman might not be the Secretary of State for Wales; he might have moved onwards and upwards by that time. Another occupant of his office might take a contrary view. There is a case for trying to get it right first time. We shall be testing the Secretary of State in Committee, in a democratic and constructive way, on some of these matters.

Like the right hon. Member for Caernarfon, we regret the fact that the Bill provides for only secondary legislation, and that there are no tax-raising powers. We would like law-making and tax-raising powers in a Senedd, which would have more power. I am sure that we shall discuss that in Committee. We need to ensure that the assembly is truly geographically inclusive. I should like it to sit in Llandrindod Wells, in my constituency. It is very well placed—some say that it is equally inaccessible for everyone in Wales. Perhaps that is a virtue, in some respects.

During the past three months, there has been an increasing divide between the rural and the urban areas not just in Britain generally, but in Wales. That is surprising, because Wales is close to a rural life. The current crisis in the beef industry is compounded by ignorance among decision makers. I do not refer to the Secretary of State, who had a long tenure in agriculture and has a significant rural area in his constituency. However, others have taken an urban stance on problems in the agricultural industry. There is no market for beef at the moment, but I will not go into that.

I expect the Welsh Assembly to be better informed in making decisions about agriculture. I expect its members to be pretty close to rural roots. That must be reflected in the assembly's agriculture committee, which must have a real power to influence. Outside the south Wales mining valleys—and even they have an element of agriculture—and outside parts of north-east Wales, Wales is a very rural country. In that respect, it is not dissimilar to Ireland, which wields great power on agricultural issues in the European Union. Wales, through its assembly, could also have a significant influence on agricultural and rural policies.

If there is a Cabinet system—and my party is coming round to that view—there should be a Minister exclusively responsible for agriculture, as well as one exclusively responsible for rural affairs. Agriculture is very important to the rural economy, with up to 25 per cent. of the Welsh population—especially in my area of mid-Wales—involved in agriculture. It is a significant part of the Welsh economy.

Mr. Jenkin

I am intrigued by the hon. Gentleman's musings about beef policy. Is it his understanding that an order to ban beef on the bone would be executed by the Welsh Assembly in respect of Wales and by the Scottish Parliament in respect of Scotland, and that such an order would apply in England only if executed by the Minister of Agriculture, Fisheries and Food—that suggests chaos on such an issue—or that the order would be a United Kingdom ban executed through this Parliament by the Minister of Agriculture?

Mr. Livsey

I am sure that the hon. Gentleman will have noted that it was the Minister of Agriculture who made the announcement the other day. He has the power, under primary legislation, to make such orders. I do not foresee the Welsh Assembly, which will have only secondary legislation powers, being able to do something like that.

The Bill refers to reform of the health service, especially health authorities, in Wales. It refers to the possibility of creating one health authority for Wales. I welcome that, because I believe that health administration in Wales is too complex and too bureaucratic. I should like there to be one health authority in Wales, and some thought to be given to how powers are given to that health authority and to strengthening trusts—based on communities—across Wales.

I should like trusts to be coterminous with local authorities. In Northern Ireland, for example, there is strong co-operation between social services and health departments—they are essentially united—providing not only cost savings but more effective care for the elderly and children, and other aspects of care.

In the Welsh Grand Committee, I mentioned the need for the Welsh Assembly to have more powers on transport, and particularly to have more influence over rail policy. Liberal Democrats think that we cannot implement an integrated transport policy in Wales without having real influence over rail policy. We shall have to make progress on that matter. Wales certainly has a third-world road communications system, which is a legacy of 18 years of conservatism. I hope that the assembly will soon start to put that legacy right.

On the assembly's procedure, clause 49 provides that the Secretary of State will have power to modify standing orders and even to alter standing orders proposed by the commission. Liberal Democrats welcome the establishment of a commission—which I am sure will be composed of people of authority and wisdom—but we think that the Secretary of State's power to alter the commission's decisions will give him perhaps a little too much power. Surely the commission's word is final. It certainly should be in a matter of constitutional reform.

Mr. Ron Davies

That is a fair point; and it is a matter of judgment. My view was that the Secretary of State is answerable to the House, and that the commission is answerable to no one other than the Secretary of State. It therefore seemed that the most appropriate thing to do was to ensure that the commission took a view reflecting the advisory committee's recommendations—which would have to be put in the public domain—and that the Secretary of State would have to explain any deviation from those recommendations. That would place responsibility on the shoulders of the person who is ultimately democratically answerable.

I assure the hon. Gentleman that the provision is there only as a fail-safe mechanism, and that, if the Secretary of State were to depart from the commission's recommendations, he would do so only on the basis of providing a very good public explanation of what the commission was proposing and why he was deviating from it.

Mr. Livsey

I welcome the Secretary of State's comments. Although I regard him as a reasonable man, perhaps a future holder of his office will not take the same view. We shall have to examine the matter.

Mr. Dalyell

I hope that the hon. Gentleman will forgive me for intruding on his speech, but he said just a moment ago that the road system in Wales was like that in a third-world country. I do not know whether that is true—

Mr. Wigley

It is.

Mr. Dalyell

If it is true and it is to be put right, may an outsider ask where the money will come from? It is all part of the same kitty of resources.

Mr. Livsey

That is a fair question. The Scottish Office, for example—I am very familiar with the hon. Gentleman's country of Scotland—has spent a lot of money on the A9 from Perth to Inverness. It would be wonderful if we had such a road—not a great big motorway or dual carriageway, but going fairly straight—right up through the spine of Wales. I could take him through my constituency, and he would be quite dizzy by the end of his journey; and that trip would be only in my constituency. From my constituency, I can travel to Scotland—on the road system in England—more quickly than I can reach Anglesey. We do not have that infrastructure in Wales.

Liberal Democrats hope that the commission will have a good political mix, perhaps reflecting the general election results.

Clause 53 provides that the assembly will establish committees on the basis of party balance. Does that mean that a member from a party other than the ruling party will have no chance of becoming a committee chairman? Perhaps the House will explore that matter in Committee.

Clause 58 does not specify the number of members on the assembly's executive committee. We shall have to sharpen up that point in Committee. In some circumstances, we could end up with perhaps only three or four members on the executive committee. I am sure that that is not the Secretary of State's intention, and that no hon. Member wants an arrangement that is too cosy.

Mr. Ron Davies

The hon. Gentleman mentioned clause 53 and queried whether committee chairmen will be from various parties. I draw his attention to clause 53(2)(b)—I realise that this is the Second Reading debate, and I shall not often intervene in such detail—which clearly provides that committee members shall…be elected so as to secure that, as far as is practicable, the balance of the parties in the Assembly is reflected in the membership of the committee.

Mr. Livsey

I do not want to go into too much detail in a Second Reading debate, but we can debate the matter further in Committee. Several points might emerge in that debate.

Mr. Robert Syms (Poole)

Will the hon. Gentleman give way?

Mr. Livsey

I give way for the last time, because I have spoken for too long.

Mr. Syms

The hon. Gentleman said that he believes that the Secretary of State is a reasonable man. Did the Secretary of State consult him on appointing the Liberal Democrat member of the advisory committee? If so, in what way?

Mr. Livsey

We certainly discussed the matter—[HON. MEMBERS: "Oh."] We were invited to the Welsh Office, as were members of Plaid Cymru, and we discussed the matter. The Conservative party did not take up the offer—which is unfortunate, but a statement of fact.

Liberal Democrats believe that regional committees must be strong throughout the length and breadth of Wales, perhaps to counteract too much power in the south-east. I am sure that all hon. Members wish power to be distributed fairly across Wales. I am sure that we shall get that right.

The block grant will be decided in the House. Many issues in the Bill—such as loans and the Secretary of State making payments to the assembly—have already been mentioned in this debate. The Barnett formula has also been mentioned. Liberal Democrats think it vital that the Barnett formula remains. There are also strong reasons why it should be reinforced. As Welsh Members know, in the past dozen years, gross domestic product in Wales has dropped by 10 per cent., and we need compensation through the Barnett formula for that drop. We shall need firmer commitments on that.

Quangos in Wales need to be sorted out, and I sincerely hope that some of them will be abolished in the next couple of years. I also hope that the assembly will have a big input into how quangos are run. We must test the Government's resolve in that respect. As a mid-Wales Member, the loss of the Development Board for Rural Wales I regret. We hope that we shall be given sufficient powers in the proposed powerhouse for mid-Wales to compensate for the loss of that body, but it will have to do an extremely good job to equal what the DBRW has done in the past 18 years.

We must look at the way in which the national parks are run. I shall refrain from discussing the current situation in my own national park, which is not exactly satisfactory. The national parks should be run according to a more democratic system, and the members governing them should be elected from candidates drawn from residents within each national park. That would create more local support for the parks.

The concordat on Europe is extremely important. Wales will have its place in Europe as one of its regions. The current review of structural funds and the loss of objective 5b status should be discussed and resolved in the Welsh Assembly, but I understand that that decision is subject to a timetable and will be reached by 1999.

The Liberal Democrats believe that the people of Wales, including those who voted no at the referendum, have accepted that there will be an assembly and, like me, they care about and are proud of their inheritance and our heritage. We believe that it is our duty in this House to create an assembly of which we in Wales can all be proud. If we achieve that, we shall leave for the next generation something worth while, which they can get their teeth into in the 21st century.

7.1 pm

Mr. Rhodri Morgan (Cardiff, West)

My hon. Friend the Member for Rhondda (Mr. Rogers) was sitting in front of me earlier and he suggested that if I spoke I should declare an interest as I have expressed the intention to stand for the Welsh Assembly. I am not sure whether I will be the only Labour Member to do so. Some Opposition Members may do likewise, but obviously Conservative Members cannot declare such an interest, although some ex-Conservative Members, seeking re-entry into politics, may do so. I believe that some have expressed that intention.

I should like to question the right hon. Member for Devizes (Mr. Ancram), who has again temporarily left the Chamber, about his mathematics. He complained that the Secretary of State for Wales had laughed at the abysmal performance of the Tories in Wales, who got less than 20 per cent. of the vote at the general election. He asked what was so terrible about getting 20 per cent. of the vote when the Government registered only 25 per cent. support for the Welsh Assembly in the referendum. Of course, he made the fundamental mistake of not comparing like with like. The yes vote for the assembly, at 50.3 per cent., was more than two and half times greater than the Conservatives' 20 per cent. in the general election.

If the right hon. Gentleman wants to use as a comparison the 25 per cent. of the electorate who voted yes at the referendum, and we allow for the turnout at the election, the Conservative share of the electorate is something like 14 per cent. Again, that is not far off half the yes vote recorded at the referendum. The right hon. Gentleman needs to be more careful in his use of figures.

The right hon. Gentleman's speech in response to the Secretary of State was short on the historical context for the debate. He did not seem to realise that this is an extremely historic measure because it is the sixth time that the House has attempted to deal with the status of the Celtic fringe countries of the British Isles. I say it is the sixth attempt because I am leaving out the unsuccessful government of Wales and Scotland Bills of the late 1970s.

Given that it is extremely likely that this Bill, based on the support registered at the referendum, will become an Act, we are talking about six Acts that have dealt with Wales, Scotland and Ireland. The two original Acts of Union for Wales were agreed in the middle of the 16th century. We then had the Scottish Act of Union in 1707; followed by the fish Act of Union in 1801; and then the Government of Ireland Act 1920. The right hon. Member for Devizes was extremely complimentary about its preamble. The final piece of legislation, the Government of Wales Bill, is one of a mere six measures over 450 years designed to deal with matters of such historical importance. That demonstrates to all of us that we are participating in an historic debate.

I am sure that many previous Secretaries of State for Wales and other politicians representing Welsh constituencies would be rightly jealous of the fact that the current Secretary of State for Wales is in a position to introduce the Bill with the backing of the referendum.

There is now every likelihood that the Bill will pass into law and that there will be a Welsh Assembly, sitting, I should like to think, in Cardiff city hall. In fact, an emergency meeting of Cardiff county council's Labour group started five minutes ago and, who knows, it may decide to reverse its earlier decision on the matter. If we had a video conference link, of which my right hon. Friend the Secretary of State is so fond, between the Palace of Westminster and Cardiff county council's headquarters at Atlantic wharf, we would know what the Labour group was thinking, just as the group would know what we were thinking.

In 18 months' time, there may be a Welsh Assembly meeting for the first time. The last time that happened was for two weeks in 1404—quite unlike the situation in Scotland and Ireland—when there were incipient Welsh Parliaments during Owain Glyndwr's rebellion against English rule. They met once at Machynlleth and once at Dolgellau, although the historical record about that second meeting is vague. The representatives at the Machynlleth Parliament were chosen by rather more democratic means than the procedures governing the House at the time. At least two representatives were chosen from every Welsh commote, as the parishes were then called.

It is clear, therefore, that today's debate concerns events of major historical significance. The right hon. Member for Devizes, however, made daft alleged jokes about great halls of people and, by doing so, sold his party and Wales short. His performance as Opposition spokesman also sold the House short.

The right hon. Gentleman completely forgot the context of the democratic devolution which we have gradually built up in Wales in the past 75 years since the original Welsh Board of Health and the Welsh Board of Education were set up in Cardiff in the 1920s. That development was followed by the institution, 33 years ago, of the office of Secretary of State for Wales. That office has been held by more Conservative Members than Labour Members because of the political current in this country during that time. Certainly in the past 18 years of Conservative rule there was no lack of volunteers for that position, even when the Government ran out of Welsh ones. The same can be said of the period between 1970 and 1974, when the Conservatives first had the opportunity to fill that office.

The right hon. Member for Caernarfon (Mr. Wigley) said that it is 111 years since the first public calls were made by recognised Welsh public bodies or major political parties for an elected council for Wales. The demand has existed for many years and it has been met by various strategies to provide administrative devolution, without accompanying democratic devolution. The English regions will find out, however, that administrative devolution inevitably leads to demands for democratic devolution, because mere administrative devolution is considered to be too bureaucratic.

Some people, including the right hon. Member for Devizes, have made the criticisms that the arrangements are a dog's dinner, that they leave too many questions unanswered, that they are too reliant on good will, that they do not cater for the storms and that they will work only during periods of calm. To be honest, all methods of democratic government rely on a degree of good will and mutual understanding.

This country's reliance until now on the supremacy of Parliament, rather than on a written constitution, has meant an even greater than usual reliance on good will; but, by and large, that good will has not failed us throughout the history of Parliament. It is good will which has carried us forward, not the demand for written, clear constitutional definitions of what is federal, non-federal or quasi-federal. We have relied on an element of British common sense to carry us through any disputes, whereas other countries such as the USA and Germany have relied on written constitutions that contain specific provisions requiring 75 per cent. or two-thirds agreement to make changes.

Mr. Swayne

Can the hon. Gentleman comment on the inevitability of an element among those who support the assembly and who will be members of it setting out to maximise disputes between the assembly and Westminster, precisely because they want the assembly to become a parliament for an independent Wales? Will he reflect on the fact that the arrangements, if they are to survive, will have to work when there is a lack of good will, as well as when there is an abundance of it?

Mr. Morgan

I certainly do not deny that there will be periods of stress in the relationship between any devolved parliament and the supreme central Parliament. Looking ahead over the next quarter century, I would never deny the likelihood of a few punch-ups and hot arguments between Westminster and a devolved parliament, but what does the hon. Gentleman think happens in other countries with devolved parliaments? What does he think happens in Germany in respect of decisions about what the lánder governments should and should not be allowed to do?

What is at issue is whether that is an argument against democratic devolution. In the debate so far, Opposition Members have tried to stir up the idea that democratic devolution will be unworkable because of the likelihood of such disputes, but a crisis such as the hon. Gentleman describes is far more likely to occur if we do not have democratic devolution.

Now that we have had the referendum, it is not right that the House should be detained overlong by anything that is predicated on our putting into operation anything other than a form of Welsh devolution, with its first sitting in mid-1999. The sooner the official Opposition—although the Conservatives are hardly the official Opposition in Wales—get used to the idea that there is going to be a Welsh Assembly, the better.

The Conservatives are starting to think about methods of selecting candidates and how to participate in the assembly. Once they have secured reasonable representation, proportionate to their usual level of support in Wales—let us hope they have a good year and exceed the 20 per cent. mark—they will find themselves taking part in a democratic assembly. They might occasionally find themselves enjoying it, rather than enduring it through gritted teeth, as seems to be their feeling today.

Mr. Huw Edwards (Monmouth)

We do not hope that.

Mr. Morgan

Sorry—in making my predictions about the level of support that the Conservatives will achieve, I am speaking as an ex-academic political scientist and psephologist.

Britain is unusual in having no written constitution; when doing things such as this, we edge our way forward from administrative devolution to democratic devolution. Democratic devolution came to Northern Ireland—indeed, that is the only previous example, although it does not provide a model that one can quote with any commendation, as it was withdrawn after 50 years in 1972 because of the unusual religious circumstances and community divisions in Northern Ireland.

People have said that we must remember the yes-no divide within Wales. We can all see that the referendum result was close, but we can also see that it showed a sort of historic line down the middle of Wales—an east-west divide stretching roughly from Great Ormes Head at Llandudno down to Nash Point or Port Talbot. West of that line, the vote was mostly yes; east of the line, the vote was mostly no, but the significant point is that there were large numbers of no voters in the yes areas and large numbers of yes voters in the no areas.

One has to express surprise at the level of the yes vote in the constituency of my hon. Friend the Member for Monmouth (Mr. Edwards). All credit is due to him for the fact—staggering to those involved in the yes campaign—that 10,000 people voted yes within the Monmouthshire local authority area. That showed that there was still a large yes vote even in what is often referred to as the most anglicised area of Wales, or even as an area which has never really accepted that it is part of Wales—Monmouthshire having been declared part of Wales only during the 1960s. The divide was not a sharp one—the majorities fell east and west of the line I described, but there was more of a spectrum, with the percentage of yes voters gradually increasing the further westward one looked. There is no great danger of Wales being divided; none the less, the Welsh Assembly must make every effort to act as a bridge between yes-voting and no-voting areas.

In the absence of true democratic institutions in the past in Wales, and given our geography—the reverse of Scotland's, where the mountains are on the outside and the people live in the middle, whereas in Wales the mountains are in the middle and the population live around the outside—centrifugal forces are strong in Wales. The Welsh Assembly will, for the first time, provide a focus—a collecting point—for Welsh public opinion in one coherent whole. Therefore, for the first time, the Welsh people will be able to express themselves democratically, rather than being divided by the forces of geography—the position of the mountains and the distribution of the population on the plains and in the river valleys of the Severn and the Wye.

Our geography also helps to explain the difference between the level of support for devolution in Scotland and in Wales. Given that 80 per cent. of the Scottish population lives in the central area, the centripetal forces are extremely strong, so it was easy for the yes campaign there to secure a high proportion of the vote, whereas it was difficult for us in Wales.

Our difficulty was increased by the fact that the word "Welsh" carries two meanings, whereas the word "Scottish" does not. When we talk about a Scottish Parliament, everyone is clear about what we mean; but when they hear the words "Welsh Assembly", many people—especially in constituencies such as that of my hon. Friend the Member for Monmouth—think that that means a Welsh-speaking assembly. The word "Welsh" has a meaning in the sense of language as well as in the sense of nationality and that gives rise to a somewhat bifocal view of Welsh identity. In the more anglicised areas, people are immediately suspicious of the word "Welsh", in case it means the Welsh language being rammed down their throats—an expression which is quite common in parts of Cardiff and Newport and is heard even more often further east, in the Wye valley and in north-east Wales.

I am therefore pleased to see that the wording of the Bill has been changed from "Welsh Assembly" to "National Assembly for Wales", which gets around that bifocal view of the word "Welsh". Non-Welsh speakers suspect that something is about to be imposed on them if they agree to something Welsh, because they think the word refers to the language, not the nationality. I am pleased that, in making adaptations as we have progressed from the White Paper to the referendum campaign and on to the Bill itself, my right hon. Friend the Secretary of State has taken such concerns on board.

Since the publication of the Bill and, more recently, the consultation paper, there has been controversy about where the assembly should be located. Cardiff councillors and Members representing Cardiff are not the most popular people among supporters of the assembly. People are suggesting that the population of Cardiff is less than whole-hearted, or is complacent, about Cardiff being the capital of Wales. Swansea people seem to be keen as mustard, but the people in Cardiff do not seem to care too much whether the assembly is located there or not. A peculiar situation has arisen and I am hoping that it may be resolved at the conclusion of tonight's meeting, or perhaps at another emergency group meeting on Wednesday. It is a pity that it has come to this.

The consultation paper has unleashed commercial and political forces. Now that the deal between the Labour group of Cardiff county council and my right hon. Friend the Secretary of State has broken down—not irrevocably, we hope—and my right hon. Friend has issued the consultation paper on the Welsh Assembly's location, forces have been unleashed. Those forces could be described as the PFI and the PFO. The private finance initiative involves property developers who want the Welsh Assembly as part of their property development because they think that it will boost its value. PFO stands for parochialism fever outbreak. The combination of PFI and PFO is unhealthy and can get out of hand.

There are property developers in Cardiff who see enormous value in having the Welsh Assembly in an urban regeneration area. At least three, if not four, schemes in Cardiff bay are being unveiled and pushed. It was put to me very simply: the developers look at the White Paper, or the Bill, and say that the assembly's running costs will be halfway between £15 million and £20 million—let us call it £17 million.

If the assembly is located in the middle of an urban regeneration PFI comprehensive redevelopment scheme, the property developers will say that that figure, multiplied by 10, will give the spending power emanating from the assembly—£170 million. They say that that £170 million guaranteed spend from the assembly in its first 10 years will fill the restaurants, taxis, hotels and houses. They therefore promise to invest £170 million in the surrounding property if they are allowed to build the assembly. Some of them are implying that they will even build the Welsh Assembly for half price or less for the honour of having it in the centre of their PFI comprehensive redevelopment scheme.

All those factors show that it will be a difficult race for my right hon. Friend the Secretary of State to ride. He will have to hold on to the reins carefully because those forces have been unleashed. None of that would have happened if the negotiations over Cardiff city hall had not broken down—that is a tragedy.

Cardiff city hall was built to ambitious standards in 1903. It was built as part of the campaign to have Cardiff declared not the capital city of Wales, but its first city. Cardiff was not a city at the time and part of the campaign was for it to be declared a city—much later, it was to become a capital city. It was because it wanted to be a city that it thought that it should have a city hall to match its ambitions, which is why it has an enormous clock tower, known in Wales as the equivalent of Big Ben. In many ways, it is the Welsh Big Ben, but Big Ben has more of a claim to be called Welsh than does Cardiff's clock tower.

I am told that Big Ben is named after Sir Benjamin Hall, a Gwent ironmaster, who stood 6 ft 4 in, weighed about 20 stone and was known as Big Ben. He was the Commissioner of Works of the Palace of Westminster. I am told that the clock tower of Cardiff city hall is a straight steal from the clock tower of Caracas cathedral, so Big Ben is actually Welsh, and Cardiff city's clock tower is Venezuelan. However, all that does not matter as, in the hearts and minds of the people of Wales, the clock tower shape with which we are all familiar—and with which we will be even more familiar after next year's European summit—is our equivalent of Big Ben.

It would be odd to invest so much in raising the image of Cardiff's city hall by having the European summit there in the middle of June next year, only to find that the Welsh Assembly is not to be located there. We can imagine some strange conversations between the Prime Minister, Chancellor Kohl, President Chirac and Prime Minister Jospin. They would say, "This is a lovely building, but tell us, Prime Minister, why aren't you putting the Welsh Assembly here? Have you got better buildings than this to put the Welsh Assembly in?" The Prime Minister would say, "Well, we had better offers, but perhaps not better buildings."

It will be a shame if Cardiff city hall becomes one of the best-known buildings in the western world, but is not used for the assembly. For the three or four days that it is in the limelight during the European summit next June, its shape will become familiar. If it does not become the home of the Welsh Assembly after all the investment in raising its recognition factor throughout the world, the assembly will be the weaker. The guildhall in Swansea is a superb building of its era, but it is nothing like Cardiff city hall. Through its good fortune in hosting the Euro-summit next year, Cardiff city hall will achieve a special world recognition factor, something which Wales lacks.

If anyone wants proof of Wales's low recognition factor, he has only to turn to the sports pages of The Observer yesterday. It contained a wonderful example of how Wales is perceived as less important than Scotland and Ireland. Yesterday, I leafed through the sports pages in a desperate attempt to find anything that did not relate to England drawing with New Zealand on Saturday. Eventually, I found something about the sale of fishing rights, which is a huge issue at the moment. The article said that one could buy fishing rights on stretches of the Tay and the Tweed for, say, £3,000 per yard or whatever, but one did not have to cross the border in order to buy excellent trout and salmon fishing rights, as one could buy a lovely stretch on the Conwy.

That is a classic example of the perception that one does not have to cross the border to go to Wales, but one does in order to reach Scotland. When the Welsh Assembly is set up, I think that that problem will largely disappear. It will give us a probably never-to-be-repeated opportunity to increase Wales's international recognition factor close to that already achieved by Scotland and Ireland.

The same will be true of the status of whichever city is chosen for the location of the Welsh Assembly. The question is not whether it will be Cardiff or Swansea, but whether any city in Wales can achieve the status—or something close to the status—that Edinburgh and Dublin already enjoy. I do not know that any city in Wales will ever reach the status of Edinburgh and Dublin, but we know that that is the competition. It would be nice to think that the location of the Welsh Assembly, whichever city my right hon. Friend eventually chooses, has a fighting chance over the next few decades to achieve the international recognition and status that cities such as Edinburgh and Dublin—with which one naturally tends to compare Cardiff, Swansea and Llandrindod Wells—already have. I do not believe that it is possible to achieve that for any city other than Cardiff.

Cardiff has a good opportunity and a good start because of the European summit and the rugby cup final that will be held in June 1999, but those are only temporary boosts—one is for three days, the other for three weeks; we hope that the Assembly will last for 300 years. I do not think that that opportunity arises anywhere else but in Cardiff, which is why I make a plea, as I did at this morning's press conference in Cardiff along with my hon. Friend the Member for Cardiff, North (Ms Morgan), for Cardiff to be chosen. My plea also goes out to the Labour group on Cardiff county council and to my right hon. Friend the Secretary of State when he finally comes to make his decision.

I have heard the remarks about new technology and the fact that one should not be a luddite and should remember what can be achieved with microwave links around Wales and video conferences. I do not deny that, although such technology will probably always pass over my head as I am not of the techno whiz-kid generation. However, there are dangers in saying that it does not matter where the assembly is located, as one can use video conferences, e-mails, websites and the latest gizmos from the computer world. That may be fine for the under-30s. I accept that most democracies are terribly old-fashioned because they insist on conducting their business face to face in Chambers such as ours. Perhaps we are worse in some ways, or more conservative, than most, because we do not even have electronic voting, whereas most legislatures do.

However, we are in danger of missing the point. The fundamental point of a parliamentary assembly or democratic body is that it is the place where people go to petition for redress of grievances. It must have the ability to legislate—it does not matter how modest the legislative powers in the Bill are. It must also have the ability to debate.

Above all, a parliamentary assembly must be able to show the people whom it represents that it is worth their while to petition it for redress of their grievances. To do so, it must locate itself in a place that people look up to with respect and affection. People must be able to say, "That is the seat of power. That is where we shall go with our petition, with our deputation, our delegation, even the riot that we want to have outside the building." People may want to riot outside the place, but they want to know that the key people are inside the place.

Let us take the farmers—

Mr. Swayne

Will the hon. Gentleman give way?

Mr. Morgan

In a minute.

The farmers who are in a great ferment—almost rebellion—in parts of Wales as a result of the beef crisis would want to know where they should go to have a riot outside or a meeting inside, or both, because that is what parliamentary assemblies are for. People must have the feeling that they can go there and cajole, threaten and make their feelings known as strongly as possible and argue that something must be done to stop what is going wrong at the moment, which is destroying their livelihood.

A Parliament must fulfil that function. I do not believe that it is possible to video conference a riot or meetings in a way that could defuse tensions. We need to be able to say to people, "Yes, we will try to put that right. We know how strongly you feel because we have seen how strongly you feel in meetings or because we have seen you through the windows and said to one another, `'Oh my God, I can see 5,000 farmers out there, rioting.'"

Mr. Elfyn Llwyd (Meirionnydd Nant Conwy)

rose—

Mr. Morgan

That is what Parliaments are for, in a way—to defuse tensions. People should think, "That is the seat of power. If we go there, we can get something done that will stop us all going down the Swanee and all being bankrupt in a few years' time."

Mr. Swayne

To which Parliament should those who want their grievances redressed come? Should they riot outside this Parliament or outside the assembly? Should they bring their grievances for redress to the hon. Gentleman, as their Member of Parliament, or to their assemblyman? The Bill does not make that clear.

Mr. Morgan

That is an evolving issue. If they are mostly Welsh beef farmers and if they are as broke as most of them claim to be, they will be unable to afford to come to London, so they will tend to visit Cardiff. Instead of stopping Irish lorries, they will want to have a big punch-up, in the figurative sense, at the assembly. They will say, "You must damn well do something about the crisis in our industry or next year there will be no beef industry left." That is a good classical example for us to think about. Where would they go in future?

The House might find itself almost in competition with the assembly, saying to people, "Come and have a riot in London because we can redress your grievances better than if you go to the assembly," but I believe that people will take their own decisions depending on what they consider to be the true seat of power on each issue.

Mr. Evans

Will the hon. Gentleman give way?

Mr. Morgan

I shall give way first to the hon. Gentleman. Later, I shall give way to the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd).

Mr. Evans

Is not the hon. Gentleman missing the point? Surely the issue is not whether Welsh farmers should riot in Cardiff or in London. If the Government were listening to the farmers of Wales, they would not need to riot anywhere.

Mr. Morgan

Dear, dear, dear. I give way to the hon. Member for Meirionnydd Nant Conwy.

Mr. Llwyd

May I, on behalf of Welsh farmers, assure everyone that they have not have been rioting? Rioting is a very serious legal issue. The crisis is extremely deep. Let us please not take it lightly. The hon. Gentleman made some strange remarks ealier, and I found them downright offensive.

Mr. Morgan

I am sorry if the hon. Gentleman has mistaken my remarks. I am using the example of the farmers to show what a parliamentary assembly is for. I am surprised if, given his party, the hon. Gentleman does not think that an assembly will be the focus for people to express their dissent, and if he does not understand that the fundamental first function of a parliamentary assembly or a Parliament is to be the place where people go to petition for the redress of grievances. Yes, legislation will be passed, yes, there will be debate, but the assembly must also be the place to take a deputation or delegation and a crisis, which may boil over.

The hon. Member for Meirionnydd Nant Conwy may object to my use of the word "riot". I have used it as a colourful expression to help hon. Members to understand what a parliamentary assembly is for and to try to predict what would have happened if the beef crisis had happened after June 1999. I am saying to him that it is likely that, instead of focusing on the ports of Holyhead, Fishguard and Pembroke, the beef farmers would be more likely to petition in front of city hall at Cardiff, the guildhall in Swansea or a brand new building.

I hope that the hon. Member for Meirionnydd Nant Conwy will accept that I intended no disrespect for the strength of farmers' feelings. I have respect for the strength of feelings of an industry in crisis—a crisis which dates back 10 years to the start of the bovine spongiform encephalopathy problem in the mid-1980s and has now come to the boil because we cannot export and we are importing. Obviously, farmers feel extremely strongly about that. That matter must be placed in the context of the Bill. We should ask what effect the Bill would have had on that crisis if it had taken place two years hence.

I make a plea to the Secretary of State. If a scheme evolves that represents an attractive financial option—similar to the claim that Swansea guildhall can be rented to the Secretary of State for Wales for the purposes of the assembly and that money will be left over—and if that is done via the private finance initiative, as these days it almost certainly will be, we must be sure that the fledgling Welsh democracy, sitting for the first time in June 1999, is not in hock to the property development consortium that provides the building.

If the building is provided by private finance, it must be provided free of encumbrances on the conveyance, if I may use old-fashioned lawyer's language, which I am sure that the hon. Member for Meirionnydd Nant Conwy understands. It must not be capable of restricting the actions of the new Welsh democracy.

The new Welsh democracy will be taking a few walks before it learns to run. It is a fledgling, and we are not used to it. Unlike the Scots, who had a Parliament until 1707, we had one for only a week or two. It will be difficult to get Welsh democracy off the ground quickly and running. Any suggestion that the new fledgling Welsh democracy is constrained by its landlord, and that it must not offend the landlord if it is financed with private finance, would be damaging to the thing that I believe we all want. Perhaps even Conservative Members, in their heart of hearts, realise that Welsh democracy is coming. Indeed, the Conservative party, with proportional representation, may find it a lifeline to rescue it from its moribund state.

That is my final plea. I hope that the Secretary of State or other Ministers can give us an assurance that if the private finance initiative is used to finance the building, it will not restrict what the Welsh assembly can do.

Several hon.Members

rose—

Mr. Deputy Speaker (Sir Alan Haselhurst)

Order. There is an element of Parkinson's law creeping into the debate. Many hon. Members are still trying to catch my eye; if speeches continue at the present length, many will fail to do so.

7.37 pm

Mr.Robert syms (poole)

Unlike many of the contributors to the debate, I find this a sad day because, as a Conservative and a Unionist, I believe that it is the start, not the end, of many years of argument.

The Bill, as drafted, falls between two stools. Although it will undermine the Union, upset the constitutional balance and pose a challenge that will cause a reaction among my constituents in Poole, it will not satisfy the strong feelings among many of those in Wales who would wish the assembly to be developed into a full Parliament, with all that that entails.

In any constitutional change, the key rule is to have a settlement so that what hon. Members decided in the Chamber sticks for many years. As the Bill stands, that will not happen. The Secretary of State said earlier that this is not an event but a process. We see in clause 22 a transfer mechanism for other powers. That is likely to increase the arguments between those of us who want to defend the Union and those in the assembly who want to promote and expand its powers. I see that as the likely future of politics for a number of years.

Listening to the speeches today it struck me that hon. Members see all sorts of possibilities for the assembly, usually involving large pots of money to spend on their favourite projects. It has been pointed out as well that, under the proposals, there will be only the same total pot of money. There will have to be a great deal of disappointment—

Mr. Öpik

Would the hon. Gentleman accept that, with judicious paring back of quangos, it is possible to release quite large quantities of money? If we replace quango appointees with elected assembly members, we shall not have to give them a large additional income for the same work.

Mr. Syms

That is a good point. There is some scope for saving small sums of money from the quangos but, as the hon. Member for Cardiff, West (Mr. Morgan) told us, the running costs of the assembly will be £17 million a year. He spoke of property developers, he spoke of 10 times average running costs—I could not help thinking that there must be other decent purposes in the Principality to which the money could be devoted. Already in the debate, Members have mentioned, for instance, a spine road through Wales and assistance to farmers. I wonder whether that is the best use of resources, although I accept that it is possible to reorder priorities.

As the assembly will not have tax-raising powers and will control the budget currently controlled by the Secretary of State, it will in effect encroach on local government. By far the largest element in the Welsh Office budget is local government expenditure. There will be a tremendous temptation for the assembly to top-slice expenditure and to choose its own priorities.

Mr. Martyn Jones (Clwyd, South)

Does the hon. Gentleman not realise that the Welsh Local Government Association whole-heartedly supports the assembly?

Mr. Syms

Yes, and I suspect that the association, controlled as it is by the Labour party, would.

The problem that I have described will give rise to conflict between the assembly and local authorities. It will, after all, be the only place to which they can go for money. A further problem is that anyone elected to the assembly will try to find a way of being seen to make a difference. Overall, therefore, I do not believe that the proposals will be helpful.

My right hon. Friend the Member for Devizes (Mr. Ancram) rightly said that the proposals must be tested against the worst-case scenario. Of course, good unionists hope that people will work together and that the United Kingdom will remain an integral entity—but it will not always be easy. Conflicts will always arise with elected authorities. Indeed, there were conflicts between local and national government when my party was in power. One sees the same problem in the dynamics between Europe and this Parliament. Those in the assembly—which I suspect will be in Cardiff—will have every incentive to posture and argue for their particular authorities: it would be most unusual if they did not. Anyone elected to such an assembly always wants to secure to himself the maximum amount of power and authority.

Meanwhile, the Secretary of State's role, if he is still in position at the time, will be difficult. Even if his party members dominate the assembly, there will be tensions. There are already tensions in the Welsh Labour group over Cardiff, for example. A certain amount of tension can be creative, but too much of it is dangerous to any democratic process. The legislation carries the implied assumption that there may be parties of the same political colour at Westminster and in Cardiff. That is not necessarily so in the long term; there could be a Labour-controlled assembly but a Conservative Government.

Mr. Ron Davies

I have listened to the hon. Gentleman with care because he is trying to make a rational case. He will not be surprised to hear me say that I do not necessarily agree with it. He is talking about tensions in the system. Is he aware of the sort of tensions there were while the right hon. Member for Wokingham (Mr. Redwood) was Secretary of State? Not one local authority in Wales was in political agreement with him; the overwhelming majority of Welsh Members of Parliament were completely opposed to what he was doing; he was reorganising Welsh local government; and—crucially—he returned £110 million of the Welsh block to the Treasury because he wanted to fulfil a political agenda that had nothing to do with Wales. Doeshe hon. Gentleman understand the tensions that that can cause?

Mr. Syms

I do. In a former life, I served on Wiltshire county council. In the course of certain negotiations, we once attended a meeting in Cardiff with Welsh local authorities to discuss pay increases. I had the distinct feeling that my right hon. Friend the Member for Wokingham (Mr. Redwood) was not the most popular person in the Principality.

There are pluses and minuses in any union. Some places contribute to the Exchequer, others take money out of it—people accept that. The same tensions may come to be felt in some parts of England if this Government stay in power for a long time.

Given the electoral success of the Secretary of State's party in Wales, one is forced to wonder about the scale of those tensions if you stick to your manifesto promises in the Principality. As my hon. Friend the Member for Aldridge-Brownhills (Mr. Shepherd) pointed out, the election result certainly supplied you with a mandate to set up an assembly for Wales, but I am not so sure that the referendum result gives you the mandate—

Mr. Deputy Speaker

Order. I remind the hon. Gentleman that he is addressing the Chair.

Mr. Syms

Thank you, Mr. Deputy Speaker.

Clearly, the no vote in the referendum got two and a half times as much support as the Conservatives got at the general election. That means that many Labour and liberal Democrat supporters—not to mention an overwhelming majority of Conservatives—must have voted no. With such a narrow vote, it is obvious that the Welsh people were in two minds. So, although I congratulate you on your victory—

Mr. Deputy Speaker

Order.

Mr. Syms

I do apologise.

I believe that devolution will be bad for Wales. The CBI has said that there is no economic imperative for an assembly. We have heard that the Secretary of State is to have reserve powers.

Before finishing, I want to mention the electoral arrangements. I support first past the post as the simplest and most accountable available system. True, it may benefit my party, but I do not believe that the system proposed for the assembly will do it justice: 40 members elected under first past the post, 20 by the alternative member system. That will mean two categories of assembly member. Will they have equal status? We just do not know. The alternative member system will operate as a closed party list system. Some may be elected in by-elections—those for the single-member constituencies—but those on the list will probably be filled by appointees. Immediately, there will be two different categories.

Mr. Ron Davies

I am sorry to intervene, but the hon. Gentleman is so completely misinformed. There is no reason at all why the members on the list should come, as he is suggesting, from smoke-filled rooms and party lists. I would hope that my party, which has not made its decision on the matter, will decide its list system on the basis of a ballot of ordinary individual members. I have no doubt that this process will be followed by other political parties. There is no reason to suggest that it will be done by some stitch-up.

Mr. Syms

I understand what the Secretary of State is saying—it will be a party, rather than an electoral, arrangement.

An ordinary Welsh constituent will have a Member of Parliament, a Member of the European Parliament, a member of the assembly elected through the constituency system and four assembly members elected under the alternative member system. In other words, he will have seven people to deal with constituency problems. All of us in the House know that people are not always clear where the boundaries occur. If a constituent has seven people to write to, there will not be accountability. Who knows which assembly member is dealing with a matter?

The system will diminish accountability. Under the present system, it is usually clear who is the Member of Parliament and where the buck stops if someone is not answering letters. There will be a problem with so many representatives. This is an area where more does not necessarily mean better and does not provide a more accountable system.

The proposals will be bad for the Union. They are expensive and will leave Wales over-governed with more political interference. The electoral arrangements are somewhat bizarre and will reduce accountability. The Bill sets too many bad precedents for the United Kingdom and leaves those of us who wish to maintain the strength of the United Kingdom a major task for the future.

7.51 pm

Mr. Martyn Jones (Clwyd, South)

Unlike the hon. Member for Poole (Mr. Syms), I think that this is a great day for democracy and a great day for Wales, as were I May and 18 September.

The enemies and despisers of democracy among the Tory ranks have made their predictable points against government being closer to the people. "Ranks" may not be an appropriate description, given that there are no Tory Members representing Welsh constituencies. The same distrustful hot air and anti-democratic rhetoric was spouted in Wales and Scotland by the Tories before the election. Where, Mr. Deputy Speaker, are those Conservative Members now? The British people ejected them, and the Welsh and Scottish people ejected them entirely.

Fortunately, the new Labour Government's plans for welfare to work and a minimum wage will ensure that former Tory Members are given an opportunity to contribute to society, perhaps in a way that they have not done previously.

Mr. Ron Davies

Get them back to work!

Mr. Jones

Get them to work might be more appropriate.

The Labour party has long argued that government should be based on partnership, democracy and inclusiveness. As part of that belief, the Welsh referendum was one of our key pledges. We delivered it, and Wales said, "Yes."

I must tackle the ridiculous suggestion that those people who did not vote were no voters. That is arrant nonsense. If that were the case, the last three Tory Governments would not have had majorities. Only 42 per cent. of the electorate voted for them, and if the 25 per cent. who did not vote had been counted as voting against them, they would not have had majorities. That is ludicrous. The "don't knows" remain to be convinced, and the Bill aims to create supporters from those "don't knows".

From a personal point of view, the Bill is a boyhood dream. A national assembly for Wales, as outlined in the Bill, will ensure that the people of Wales have the voice that they deserve, and will ensure that Wales is not left behind. We shall have fewer quangos and more democracy. Wales will secure more jobs, and better schools and hospitals. All that is part of my right hon. Friend the Prime Minister's vision of a modern Britain.

The Welsh Assembly will give Wales a better health service by ensuring that scarce resources are spent on nurses and doctors, not on bureaucrats and red tape. It will provide better skills by setting tough new standards for literacy, numeracy and overall achievement. It will provide better job opportunities by providing a voice in Europe and around the world to attract investment and back Welsh companies.

The assembly will provide better democracy and will ensure that decisions about local schools and hospitals will be made not behind closed doors in London but by people elected in Wales. It will provide better value for money, by bringing Welsh quangos to public account and scrutinising spending decisions.

I am particularly pleased that the assembly will improve the government of Wales by working in partnership with others, particularly Welsh local government. In this way, the assembly will bring the process of decision-making closer to the citizen, making national decisions closer to local government and augmenting the vital work of local government, rather than encroaching on its role.

The assembly is part of a wider vision of a modern Britain from a Government who believe that too much power is centralised in the hands of too few people, with too little freedom for local communities to decide their own priorities; hence the Government's proposals to meet the individual needs of Scotland, with a Parliament, and London, with a mayor. Perhaps, in time, we shall see regional governments throughout England. For the first time, decisions on schools, hospitals and other key services in Wales will be made by people elected by, and democratically accountable to, the people of Wales.

There is a desire to make Wales more powerful economically, and the Bill's proposals will do much to make this desire a reality by securing inward investment and stimulating home-grown enterprise. Wales can go even further. Through the character of its people, its innovative entrepreneurs and its fine educational heritage, Wales has unparalled opportunities to become an economic powerhouse in the context of sustainable development, making Wales an economic powerhouse today and tomorrow for ourselves and our children.

Sustainable development is not only a question of biodiversity, environmental protection, traffic reduction, renewable energy and securing clean air and water. It also provides opportunities to create jobs. As my right hon. Friend the Prime Minister said at the New York Earth summit on 23 June: We must make the process of government green. Environmental considerations must be integrated into all our decisions, regardless of sector. They must be in at the start, not bolted on later. As Wales is reliant on industries such as agriculture and tourism, a healthy, rich and flourishing land is vital. It is also vital that sustainable development is integrated into all parts of the new assembly's powers.

Mr. Swayne

Will the hon. Gentleman comment on the point raised by the hon. Member for Brecon and Radnorshire (Mr. Livsey), who saw the assembly—quite how he discerned this I am not sure—as an opportunity for a vast new road-building programme in Wales? How does that square with sustainable development?

Mr. Jones

That is a good point—it will be up to the assembly. However, the hon. Gentleman is putting words into the mouth of the hon. Member for Brecon and Radnorshire (Mr. Livsey), who was not talking about vast new road building. We need the dualling of a few roads between north and south Wales. If the hon. Gentleman has driven from north to south Wales—I do not know whether he has—he will understand what we are talking about. If he leaves the New Forest and visits Wales again, he may come to understand why we would like some improvements. However, we are not talking about huge five-lane highways.

Mr. Öpik

Does the hon. Gentleman agree that my hon. Friend the Member for Brecon and Radnorshire (Mr. Livsey) was referring to giving a higher priority to an integrated transport system for Wales? As someone who represents Wales, my hon. Friend understands how difficult it is for north Wales to connect to the south. Does t+he hon. Gentleman agree that that involves not new roads, but improvements to the existing infrastructure?

Mr. Jones

I agree absolutely. The point is that the assembly will make those decisions whereas, at the moment, there are conflicting priorities for the Secretary of State, who makes the decisions. We have suffered from the fact that, until now, the Secretary of State for Wales has not been Welsh. On one occasion, a Secretary of State of ill fame preferred not to visit Wales. I do not know how he could have known whether the A470 down to south Wales needed to be improved.

Mr. Oliver Letwin (West Dorset)

I am following the hon. Gentleman's remarks with interest, as he is dealing with a subject of great importance. Perhaps he can explain something to us. In the case of a trunk road, where a specific allocation is not made by the Department of Transport of the United Kingdom to the Welsh Assembly, how could funding for it be allocated by the Welsh Assembly, except by top-slicing the local authorities?

Mr. Jones

The hon. Gentleman is obviously unaware of the present situation. I forgive him, as he is a Member for England. He could not be a Member for Wales, as there are no Conservative Members representing Welsh constituencies. The Welsh Office currently deals with matters such as the hon. Gentleman describes. The funding is available and is run by the Secretary of State for Wales. The assembly would take over the role of the Secretary of State for Wales. If the hon. Gentleman does not know that, I am sorry. He should know it.

Sustainable development should be integrated into all the assembly's functions. The assembly can make such decisions. Farming deserves an extra mention. A strong Welsh voice in Europe—

Mr. Letwin

I may be in genuine error, but it would be helpful to understand the point. Is the hon. Gentleman claiming that some sum of money, which is currently available to the Secretary of State, would be available to the Welsh Assembly for a trunk road programme, and that it would not include money that would otherwise go to local authorities in rate support grant?

Mr. Jones

Yes. I am rather surprised that the hon. Member for North Essex (Mr. Jenkin), who was, I thought, educating the hon. Member for West Dorset (Mr. Letwin), did not know that. It shows an even greater depth of ignorance if an hon. Member on the Front Bench does not know that. Of course there is no shadow Secretary of State for Wales, so perhaps we cannot blame the Opposition for their ignorance.

Farming in Wales is in trouble, but the Welsh Assembly would have a role in helping farmers to put their case to Europe. Their problems were generated by the previous Government, but are exacerbated by Europe because of the beef ban. When we have a Welsh Assembly and a representative who can go along with the UK Minister of Agriculture, Fisheries and Food, that case can be put strongly to Europe. In the longer term, the environmental and social reform of the common agricultural policy is probably the answer for our hill farmers. Sustainability, openness and accountability under a Welsh Assembly will benefit farmers, consumers and industry.

The creation of the Welsh Assembly should, in theory, be across party lines. It is, in the main, but sadly it does not seem to include the Conservatives. In the interests of democracy and of the people of Wales, I hope that one day some Tories will be part of that partnership.

Unfortunately, the Conservatives have tried to make devolution a left-right issue in terms of political persuasion. It is a left-right issue—one that involves making sure that Wales is not left behind, and doing what is right for the people of Wales.

The Bill is excellent. Even excellent things can be improved, but it is a wonderful start. Wales needed a voice, Wales deserved a voice, and now Wales will get a voice.

8.2 pm

Mr. Desmond Swayne (New Forest, West)

I shall be brief. After the referendum, the Prime Minister spoke of the need to allay fears and to be sensitive.

The hon. Member for Swansea, East (Mr. Anderson) portrayed the narrowness of the result as having placed the Government under certain constraints. When asked to define those constraints, he gave two examples. First, he said that the Government had gone ahead with an element of proportional representation. I do not regard that as being sensitive or allaying fears. The hon. Gentleman's second example was the setting up of a consultative body, but as has been pointed out by my right hon. Friend the Member for Devizes (Mr. Ancram), the Secretary of State has chosen the Conservative he wants on that consultative body rather than consult the Conservative party in order to make an appropriate choice.

It is all very well for the Secretary of State to say, "He wouldn't come to the meeting." When I want something from somebody, be it advice or assent to a particular proposition, I invite that person to a meeting. Setting aside whether there is an agenda for that meeting, should the person fail to come to the meeting I take the elementary precaution of writing to him or her so that I at least have it in writing. I might write a conciliatory letter or, depending on the circumstances, I might write a fairly snooty letter, but I would write a letter. That clearly did not happen in the case in question.

The Government have chosen the Conservatives they want to represent the Conservative party. We will not know until later in the week whom they have chosen, but that is unacceptable behaviour from a Government who, after the referendum result, set out to allay fears and to show sensitivity.

I shall analyse three areas in which the Government have shown no intention of allaying fears and no semblance of sensitivity. The first is the absence from the Bill of any statement of the sovereignty of Parliament in Welsh affairs. The Secretary of State argued that that would be constitutional nonsense because this Parliament is sovereign and cannot be bound by its successors. To put a statement about the sovereignty of this Parliament in the Bill would, in the Secretary of State's words, be meaningless.

However, there is such a statement in the Government of Ireland Act 1920. It was included because of the need to allay fears. The fact that there is no such statement in the Bill shows insensitivity to the need to allay fears and greater priority being given to assuaging the desires of nationalist Members.

Mr. Hanson

Has the hon. Gentleman read clause 1(3)?

Mr. Swayne

I have, and at the outset of the debate I heard the Secretary of State's assertion that this Parliament is sovereign. The Bill should begin with a ringing declaration of the sort in the 1920 Act. For the Secretary of State to say that it would be meaningless because it could be repealed is nonsense. If this Bill becomes an Act, it too could be repealed, but that does not make it meaningless. The logic used by the Secretary of State is wholly inadequate.

The second area in which the Bill fails to address the sensitivity issue or to allay fears is the fact that the Committee stage is not to be taken on the Floor of the House. Despite the press release issued by the Welsh Office on 27 November, which was quoted by my right hon. Friend the Member for Devizes, the Secretary of State has made it clear that the entire Committee stage will not be taken on the Floor of the House.

The Secretary of State showed contempt for constitutional precedent when he said that he did not care about the precedents, that the procedure would be new and that he was proud of it. If the Government are attempting to show a measure of sensitivity, as the Prime Minister said, and to allay fears, the Secretary of State has robbed himself of one of the principal means by which he might have allayed fears—allowing a full and open debate on the detail of the Bill on the Floor of the House.

The third area in which the Government have failed to exhibit sensitivity and to allay fears is their persisting with proportional representation. The hon. Member for Swansea, East claimed that the proportional representation element would act as a constraint on the Government, but I believe that it is one of the most regrettable and insensitive parts of the Bill. It is one of the provisions that is regarded with the most suspicion by those who voted against the proposition of an assembly in the referendum. Persisting with proportional representation would be a retrograde step.

The Bill introduces a most pernicious form of proportional representation. It is pernicious for two reasons: first, it relies on the D'hondt formula, which is totally untransparent and extremely complicated for voters; secondly, the people will not vote directly for their representatives. It will lead to a most unhealthy separation between those who cast the votes and their representatives.

Under the proportional representation system, candidates must concentrate not on the needs, aspirations and concerns of the voters—who do not vote for the candidates—but on the priorities of those who make up the lists. It is argued that the lists may be compiled through some democratic forum within a particular party. It does not matter how wide the franchise is within a party: the decision will not be taken by the voters.

The Parliamentary Under-Secretary of State for Wales (Mr. Peter Hain)

Is not the hon. Gentleman overlooking the fact that 40 representatives on the assembly—the majority—will be elected directly and will be accountable to their electors? Is there not merit in the fact that in south Wales, for example, the Conservatives will be topped up and will receive representation on the assembly through the additional members system? In mid-Wales, Labour will probably receive representation that it would not have otherwise. Is there not merit in all the parties receiving greater representation in proportion to their total vote? That did not happen to the Conservatives on 1 May.

Mr. Swayne

No, I do not see any merit in that proposition. As far as I am concerned, 20 too many assembly members will be elected by proportional representation. The system will not be understood clearly by the electorate—the voters will be confused. Some assembly members will be elected by the people and others will not because they will be chosen within the party system.

A further danger is that proportional representation leads to the separation of the electors from the elected. Anyone who visits Germany, which suffers under the proportional representation system, will be struck by the fact that ordinary people in the street are deeply anxious about—even hostile towards—plans to abolish the deutschmark, but consult members of the political caste and one will find no reflection of that anxiety or hostility among the people's representatives. The political caste has become divorced from the electorate because it looks not to the electorate and its concerns but to those who compile the party list and their concerns. That is precisely the weakness in this system.

Mr. Öpik

I accept that the hon. Gentleman has a pernicious dislike of the proposed proportional representation system and assume that he does not wish to return to the first-past-the-post system, which would prevent the Tories from exercising any influence in Wales for a long time—so what system of proportional representation do he and his party propose for Wales?

Mr. Swayne

The hon. Gentleman misunderstands my position completely. I am absolutely in favour of the first-past-the-post system. The Conservatives have not grumbled about the fact that we lost all our parliamentary representatives in Wales—although we made a not unhealthy showing in terms of total votes. We live and die by a system that has advantages and disadvantages. A clear advantage of the system is that it is understood by the people of Wales and of this country.

Mr. Laurence Robertson (Tewkesbury)

Does my hon. Friend accept that the phrase "first past the post" is an inadequate way of describing that voting system? Its great benefit is that it links the representative to the constituency and to the constituents to whom he should report.

Mr. Swayne

That is precisely the strength of the system. We must recognise that many electors cast their votes against particular candidates. That is a phenomenon from which the Labour party benefited on 1 May—many voters were determined to see the back of a particular rascal. I apologise, Mr. Deputy Speaker. Labour Members would rob the electorate of that opportunity in the case of a third of assembly members.

That point may be regarded as a detail of the Bill that could be considered in Committee, but the Secretary of State has said that the Committee stage of the Bill will not take place on the Floor of the House. Furthermore, because the Government have made so much of the proportional representation element, they have in effect made it part of the principle of the Bill rather than a mere detail.

The assembly will commence with an electoral system that is not understood by the people and that has a built-in democratic deficit. On that basis, the Bill should be opposed.

8.16 pm

Mr. David Hanson (Delyn)

Thank you, Mr. Deputy Speaker, for giving me the opportunity to contribute to this historic debate on legislation to establish an assembly for Wales. I am genuinely saddened by Conservative Members' failure to learn the lessons of 1 May and before then. It seems to me that the Conservative party has failed miserably to understand why no Conservative Members speak today for Wales from Welsh constituencies, why the Conservative party received its smallest share of the vote in Wales for many years and why it was wiped out in Wales for the first time since 1906. It saddens me that Conservative Members have failed to understand those issues concerning the Welsh dimension.

Mr. Nick St. Aubyn (Guildford)

If the Conservatives are so out of touch with the views of the Welsh people, perhaps the hon. Gentleman will explain why the approach that we took to the Welsh Assembly proposal chimed with that of half of those who voted in the referendum?

Mr. Hanson

I shall come to that point in due course. All hon. Members have lessons to learn from the referendum campaign and its result, but that does not diminish the fact that the Conservative party has learnt nothing. I hope that, before the Bill completes its passage through Parliament, Conservative Members will come on board and help to make the assembly a success—which is what I believe most parties want.

Many other countries in Europe have regional government. I believe that regional government is, in itself, a good thing. The arguments against regional government advanced by the Conservatives during the referendum campaign and in today's debate would be greeted with incredulity in Spain, France and Germany. Regional government can be a natural form of government that is close to the people and good for the community.,

I welcome the debate today because, like my hon. Friend the Member for Clwyd, South (Mr. Jones), I believe that it is a good day for democracy and for the people of Wales. I welcome the Bill because it will transfer the functions of the Welsh Office to a regional assembly. It will give added impetus to the control of the 2,000 staff and the £7 billion budget that the Welsh Office is currently operating. It will give my constituents and others local democratic input into public service priorities.

The Bill will also achieve something for which I have long campaigned in the House: it will make a start—I recognise that it is only that—on democratising the pernicious quango state that has existed in Wales for 18 years. It will also assist Welsh Office Ministers—and Ministers in future Governments—to raise a proper, effective voice for Wales in Europe on a range of issues.

I welcome the start of the removal of the quango state. I think that further action can be taken in due course. The establishment of the assembly will democratise the quango state, which in Wales especially has been the fiefdom of an unelected Conservative party over the past 18 years.

The Welsh Office currently makes 600-plus appointments. They are now being made by one Secretary of State and two junior Ministers. Under the previous Administration, those appointments included many, many people who were not representative of the people of Wales or part of the community. Some did not even live in Wales. The assembly will be a great step forward in terms of quangos.,

One of my constituents, Mr. Philip Pedley of Cilcair, is an active Conservative who has fought three general elections for his party. He was appointed without one vote in Wales because he had contested English seats during three general elections. Mr. Pedley was appointed deputy chairman of Housing for Wales—Tai Cymru. He has benefited from the quango system. However, he voted for the assembly. Even as a Conservative, he went on a platform in my constituency and said that he recognised that the quango state was untenable and needed to be reformed for a democratic Wales and a democratic future.

The ending of the quango state will be a great step forward and of great benefit to the people I represent. Its replacement with a democratically elected forum will, in my view, enhance people's understanding of the work that is done on behalf of the people of Wales and enable them to have a real say.

One of my constituents even went to the stage of calling one of his race horses The Quango King. He was on so many quangos when he had that particular horse that he decided to throw a bone to democracy by so naming his horse.

We have a democratic deficit that will be filled in great part by the assembly. The faceless, unaccountable and often unelectable will be challenged by the assembly, which will govern on behalf of the people with their democratic mandate.

The hon. Member for Poole (Mr. Syms), who is no longer in his place, mentioned tensions between the assembly and Government bodies. The Conservative party has never had a majority in Wales during my lifetime—not in 1979, 1983, 1987 or 1992. Since I have been able to vote in general elections, the Conservative party has never had a majority in Wales. As a result, there were tensions, and there will undoubtedly be tensions in future, but those tensions will be against the background of the people of Wales having a say in their democracy and being able to elect a body to speak on their behalf. In some instances they will choose, perhaps, to elect an assembly that is in opposition to the Government, which is a perfectly legitimate thing to do. Tensions will be created occasionally, but they will be healthy tensions in a democratic system.

Mr. Jenkin

We hear much of the argument that because the ruling party at Westminster had no majority of Members in the Principality, the United Kingdom Government's rule in Wales had no legitimacy. Is that what the hon. Gentleman is saying? If so, he is articulating a nationalist argument, not a regionalist argument. That is a dangerous road to take his party down.

Mr. Hanson

The House has been sovereign and has been accepted as sovereign. It is still sovereign under the Bill. I say that the government of Wales should reflect the wishes of the people of Wales. When the assembly is established, the people will have an opportunity to put forward their case, to argue their case and to elect assembly members. They will have a democratic input into the running of functions that are now run by the Welsh Office.

Mr. Jenkin

The Government of Wales are sitting on the Treasury Bench—they are the Government of the United Kingdom. By setting up a separate administrative arrangement in Wales that is answerable to a separate assembly in Wales, the hon. Gentleman is institutionalising conflicts between Wales and London, between Cardiff—if that is where it ends up—and Whitehall. Is that not rather a dangerous thing to do given that some people do not support—the right hon. Member for Caernarfon (Mr. Wigley), who is not in his place at the moment, is one of them—the concept of the supremacy of Parliament? That being so, the assembly may become a platform for disputes about the sovereignty of Parliament.

Mr. Hanson

Much in the Bill will strengthen relationships in the Union and the relationship between the House and the people of Wales because it will give confidence to both. The assembly, once in place, will establish public authority over the 80 quangos that are now operational in the Welsh Office. That is a good thing. The Bill gives power to elected democracy rather than to a quango democracy.

The Bill will provide an economic powerhouse for Wales. It will provide for strong local national health service management as well as a strong input into education in Wales. It will provide a strong platform for transport improvements. It will also enshrine the relationship between voluntary organisations and other bodies that wish to have a role in that sector.

I welcome the extension of the role of the Welsh Development Agency so as to create an economic powerhouse. It will be given the power to have the Land Authority for Wales under its jurisdiction. Individual but co-ordinated actions will be possible across the gamut of economic development.

We shall have a raft of examples of democratisation without the existing structure being replaced by a dictatorship, which has often been the case in the past. We shall be pulling in a democratic structure that will enable people in Wales to determine their priorities within the framework of the United Kingdom as a whole.

As I have said to the hon. Member for North Essex (Mr. Jenkin), I believe that the Bill will bind the United Kingdom together. It provides for devolved regional government within the United Kingdom framework. The House will still be responsible for foreign affairs, social security matters, taxation and defence. Those are major areas of public expenditure. The £7 billion contribution from the Welsh Office is but a small part of overall expenditure on behalf of the people of Wales that is made by the House. The House will still be responsible for key areas of policy that affect constituents in Delyn and elsewhere.

The referendum campaign was a great success.

Mr. Evans

The hon. Gentleman claims that the referendum was a great success and talks about regionalisation of the United Kingdom with assemblies everywhere. Does he not realise that the referendum was an appalling fiasco and failure in Wales, which is why the Government have derailed the assembly programme in England?

Mr. Hanson

I do not accept that. The hon. Gentleman will find that in due course there will be regional arrangements for England, because they constitute the natural way to go forward. I regard the proposed establishment of the assembly and the referendum in Wales as successes. As has been said, there was cross-party co-operation, which added to the success of the assembly campaign. The three parties—the Liberals, Plaid Cymru and Labour—worked together to try to ensure that there was a mandate. I accept that it was a marginal mandate and that in my constituency area, Flintshire, there was a no vote. It was, however, a Wales-wide assembly vote.

I shall kill a couple of Opposition arguments. We all went into the assembly campaign as consenting adults. We all knew the rules before we began the campaign. Similarly, we all knew what the game was when we had the vote on 18 September. If Conservative Members feel that the Government would not have cancelled the Bill if they had lost the vote, they are living in cloud cuckoo land. It was an all-Wales vote, the margin was small but it was a yes vote. I hope that the Conservative party will accept that yes vote and begin to work with the assembly.

It is argued that there was only a 25 per cent. turnout for a yes, that many people voted no, and that 48 per cent. did not vote at all. Following that argument, 69 per cent. of the electorate of the right hon. Member for Devizes (Mr. Ancram) did not vote for him. That was true of 68 per cent. of the electorate of the hon. Member for North Essex, 67 per cent. of that of the hon. Member for Ribble Valley (Mr. Evans) and 70 per cent. of that of the hon. Member for New Forest, East (Dr. Lewis). I do not deny their right to sit in this Chamber. I do not expect them to take the Chiltern Hundreds or the Stewardship of the Manor of Northstead this evening. I recognise that they won their contests under the rules; I hope that they recognise that the Government won this contest under the rules and that the assembly should proceed.

Mr. Jenkin

rose—

Mr. Hanson

I give way for the last time.

Mr. Jenkin

Can the hon. Gentleman say in which European countries with a history and tradition of referendums a simple majority of a 50 per cent. turnout would be enough radically to change the constitution?

Mr. Hanson

This is not "Mastermind", and my topic is not European referendums in the 20th century. I cannot answer that question; perhaps the hon. Gentleman will refer to it in his closing speech. The point is that, on 18 September, the rules were clear. The House set the rules and on 18 September the Government won on those rules.

The right hon. Member for Devizes claims that all those who did not vote, effectively voted no. He must have great prescience and be able to communicate with the dead. The register was drawn up in October last year and the vote was on 18 September this year. Many of the people who did not vote died or moved out of Wales during the year. He must be Mystic Mike. He has decided that all the people who died or moved are against. That is not practical; it is not real politics.

I hope that, after today's debate, the Conservative party will come on board. I do not want it to repeat the Winchester experience in the Welsh Assembly. In Winchester, it lost an election by a small majority, whinged about losing, took it to the nth degree and lost dramatically when it refought the seat.

I hope that the Conservatives will play a full and active role in the assembly and argue their case. Dare I say that I hope that they win the odd seat. They have a right to sit there, because they got 20 per cent. of the vote in the general election. I hope that, like my constituent Mr. Pedley and Lord Roberts, they will come on board, bury their differences and put their constituents in Wales first so that they have a voice in the assembly.

I have a couple of points on north Wales—my part of the country. There was a strong no vote in parts of north Wales. I have spoken to my hon. Friend the Under-Secretary, the Member for Neath (Mr. Hain) privately and publicly about that. I hope that the Government accept that the no vote happened and that we need to campaign to ensure that people understand the relevance of the assembly. I voted yes, as did many of my colleagues and friends, but the campaign continues. It did not end on 18 September; it began in full that day.

I hope that my right hon. Friend the Secretary of State continues to make the campaign inclusive and to explain the benefits of the assembly and, following the process in the Bill, looks outwards to our communities. I hope that the regional committee will have a real and effective role in north Wales and that Ministers will try hard to ensure, both before after the assembly is established, that transport links between north and south Wales are strengthened, by rail, air and road.

Mr. Letwin

rose—

Mr. Hanson

; I have given way enough. As the hon. Gentleman represents West Dorset, perhaps he should move to Wales and take part in the assembly. I hope that our constituents learn to use the assembly and make it strong and viable.

There has been some discussion of the siting of the assembly in Swansea or Cardiff. I do not want to be regionalist, but wherever the final base is, we need a one-stop shop so that people in my part of north Wales can have a close link with the assembly. They should be able to call in and use the internet; to feel the administration. Its physical presence should not require the four hours on the train or road that it takes to travel from my constituency to Cardiff.

There is much in the Bill that merits the support of all hon. Members in tomorrow's vote. I am proud to have supported the Bill during the referendum and I will be proud to vote for it tomorrow night. It will democratise much of what needs democratising in Wales. There is too much in the hands of Ministers. There is a crying need for people to play an active role in Wales. The Conservative party ignores that at its peril. If it does not play a full role, it will be sidelined even more than it already is in Wales.

8.35 pm

Mr. Oliver Letwin (West Dorset)

I wish mainly to address the implications of clause 80, but before the hon. Member for Clwyd, South (Mr. Jones) leaves his place, I would like to discuss a point that he made of which I have yet to be persuaded.

The Bill provides for a sum of money to be paid from central Government to the assembly. If the total sum remains invariant, and it is decided to allocate an increased proportion of that money to the trunk road programme—a point made by the hon. Gentleman and, I think, by the hon. Member for Delyn (Mr. Hanson)—I assume that it will have to come out of the current total. It must therefore come out of the health programme—is that what the hon. Member for Clwyd, South had in mind?—or the education programme, which seems unlikely. If it does not come out of those programmes, it must, as I suggested, come from top-slicing revenue support grant. That is by far the most likely outcome. I would be most interested in the hon. Gentleman's reply.

Mr. Martyn Jones

The hon. Gentleman's original question was not clear but he has clarified it, perhaps with some education from his Front-Bench colleagues. I was trying to point out that road programme spending priorities will be in the hands of the assembly, which might decide to take money from other sectors of the Welsh Office budget. My point was that it might want to improve one part of the A470 rather than another. The hon. Gentleman's point is separate from that.

Mr. Letwin

I am grateful for that clarification. I remain wholly unpersuaded. The Secretary of State already has such discretion in respect of the trunk road programme. The assembly will either be able to reprioritise, compared with the present, or it will not. As far as I can see, it will be able to reprioritise only if it deprives another element of the same total budget.

Mr. Jones

I now know exactly where the hon. Gentleman is coming from. The Secretary of State currently has the power to prioritise road programmes in Wales. My point is that the assembly will have that power, and that the assembly will consist of members from Wales with real experience of Welsh roads who will be able to make bids. Under Conservative Governments, we had Secretaries of State who had no experience of roads in Wales.

Mr. Letwin

Now I understand the hon. Gentleman's point, which brings me directly to the effects of clause 80.

Clause 80 will no doubt be extensively debated, if it is one of those that we will be vouchsafed the ability to debate on the Floor of the House. If not, it will no doubt be debated upstairs in Committee. It is the most remarkable piece of drafting it has been the privilege of the House to consider, even under this Government. As my right hon. Friend the Member for Devizes (Mr. Ancram) said in his opening remarks, it states: The Secretary of State shall from time to time make payments to the Assembly out of money provided by Parliament of such amounts as he may determine. That is unrestricted.

It is a most interesting piece of drafting. The hon. Member for Cardiff, West (Mr. Morgan) said that he did not want the private finance initiative origins of the headquarters of this great assembly to suggest in any way the ability to pull levers that would affect its decisions. Clause 80 allows the Secretary of State unrestricted powers to pull levers of any sort.

Let us take the interesting case that I have just been discussing in my exchange with the hon. Member for Clwyd, South. Let us suppose that the Secretary of State for Wales determined that a decision on priorities set by the assembly in respect of transport or any other matter was slightly mistaken. If the Secretary of State did so decide, he would have available to him the immediate power to make the assembly listen to his view rather than to its view. He would be able to threaten—as, from time to time, is within his discretion—immediately to vary downwards the amount of grant given to the Welsh assembly.

It is, of course, possible to generalise, and to apply that small example to a wide range of issues. What we have here, however, is an interesting picture not of an assembly, but of an animated poodle that is to be led by the Secretary of State around whatever courses he may choose, by means of the strong chain that the Secretary of State holds—the fact that he is its paymaster.

That prompts an interesting question. What have the Government in mind to establish? Let me return to my earlier debate with the hon. Member for Clwyd, South. Do the Government intend to provide for the ability to reprioritise? If so, why, in drafting the legislation, did the Secretary of State not specifically bind his own hand to prevent himself from varying the amount downwards, merely because of the reprioritisation? Or does the Secretary of State intend never to exercise the power to vary the amount downwards as a use of prerogative power—or quasi-prerogative power—to force the assembly into a certain plan of action? Why does he not provide for that in the Bill?

The Secretary of State has repeatedly described this as a process rather than an end point. Perhaps he intends the assembly, over time, to be given tax-raising powers, and therefore feels that it will become less important and less of a lever. If that is his intention, surely it behoves him to tell the House now.

One way or another, we are bound to conclude that the Bill bears a striking similarity to the Bank of England Bill, in that it appears to give another body a basis for independence—but, having given that appearance, it takes it back in clause 80. It creates a poodle, and, moreover, a poodle that can be kicked. it gives the Secretary of State the ability in practice to determine almost every aspect of the assembly's action by means of a constant subtle threat to use the financial lever, and then to complain, when the assembly takes steps that it is virtually bound to take because of the financial stringency imposed by the Secretary of State and the Chancellor of the Exchequer, that it is the fault of the assembly rather than that of the Secretary of State. Similarly, under the Bank of England Bill, the Chancellor of the Exchequer can de facto control the Bank of England's activities by setting certain targets, and can then complain that it is the Bank of England's fault if the wrong interest rates have been set.

That is a point of the utmost constitutional importance, and it brings us to a line of thought that has been brilliantly exposed in a series of speeches by the right hon. Member for Llanelli (Mr. Davies). Speaking on the entirely different topic of the European Union, the right hon. Gentleman has often reminded us that the biggest question that we face when considering constitutional issues is what we are trying to aim for. The problem that is revealed in clause 80 does not concern the mere mechanics; it concerns the objective.

It must become clear to anyone who reads and understands clause 80 that the Bill and the assembly are founded on a certain political necessity, rather than on any clear concept of what the Government are trying to do in creating the assembly. That attack could, perhaps, be levelled with less justice against the proposals relating to Scotland: at least the intention is clearer in that regard. In this case, the lack of objective is likely, over time, to create the problems that my hon. Friend the Member for Poole (Mr. Syms) exposed so clearly.

Where there is no objective at the time when the legislation is passed, there must be a great danger that, eventually, the assembly will itself assert objectives to which the House has never subscribed—that it will assert that the aim was somehow to create a genuinely independent state of Wales. We can be in no doubt that Welsh nationalist Members—none of whom are present now—will use that argument.

Mr. Dalyell

Will the hon. Gentleman clarify his reference to Scotland?

Mr. Letwin

Yes. I do not wish to suggest that I believe that the objective is entirely clear in the case of Scottish devolution—which I oppose—but I think that it is at least clear that, in the case of Scotland, there is an intention to give a Scottish Parliament something approaching a national status. Those of us who violently object to that proposal object to it on those grounds.

In this instance, I think that it is genuinely unclear what the Government have in mind. As I have said, I believe that in the long run that will be more likely to generate constitutional tension. Where there is a vacuum of ideas, the vcuum will be filled, and filled above all by those in the assembly who have a particular doctrine. Whatever we may think of the Welsh national position—and Conservative Members wholly disagree with it—it is at least coherent: it has a clear objective.

It seems altogether likely that, when a Government enact legislation that betrays the fact that it has no objective and creates an assembly that is a poodle, the poodle will react by becoming very vicious. It will try to obtain the maximum mileage by running up and down and yapping, and by trying to bite the heels of those who attempt to control it.

I fear that we are creating the basis for continuing constitutional tension. The assembly will seek to assert itself, and to establish for itself an aim that the Bill—both mechanically and by intention—fails to give it. That strikes me as a remarkable example of lack of constitutional understanding and constitutional foresight. The most important task for a United Kingdom Government considering the constitution of the United Kingdom is not to reach a particular answer, but always to think about the long-term effect on our constitution—not just in Wales, but in the United Kingdom as a whole—of a particular set of objectives, or lack of objectives.

That brings me to my last point. Labour Members have repeatedly asserted that there is a deficiency in Conservative doctrine, or the rights of Conservatives here, because there are no Conservative Members of Parliament in Wales. We are not debating the constitution of Wales; we are debating the constitution of the United Kingdom, or one aspect of it. In that, every UK citizen has an interest. We have an interest in it mechanically, but also from the point of view of the precedent and the concept that are established here.

If we in the House accept legislation that establishes new constitutional mechanics without clear objectives, we put in doubt the whole future of the country's constitution. If we accept the establishment of an assembly that will lead to constitutional friction within the United Kingdom, everyone in the United Kingdom will suffer the disadvantages of that friction from now on. That is why I oppose the Bill.

8.47 pm

Mrs. Betty Williams (Conwy)

I have listened to many speeches today, some of which have led me to believe that we need the Bill so that the people of Wales can govern themselves as we want them to be able to.

I congratulate my right hon. Friend the Secretary of State and his team on the publication of the Bill. Our people—the people of Wales—have waited a long time for this day. I am particularly pleased and proud to be a Member of Parliament because I have witnessed this historic event. The White Paper published in July gave us in Wales an opportunity to engage in open and frank discussions on how we wished to be governed, and, between July and 18 September, that is precisely what we did.

The White Paper was endorsed by the nation in the referendum on 18 September. The Bill translates the White Paper's proposals into the detailed provisions that are necessary to establish the Welsh Assembly. The nature and number of clauses in the Bill show the efforts that my right hon. Friend and his team have put into taking account of the views expressed by individuals and organisations in Wales.

As a member of the Select Committee on Welsh Affairs, which has met several times since 18 September, I have been privileged to hear the views of a wide variety of bodies, such as the Welsh Local Government Association and, contrary to what Conservative Members have said, the Welsh Development Agency, the Confederation of British Industry, the Welsh Trades Union Congress and others. The Select Committee has also received many written representations. The overwhelming view is that we are moving in the right direction to enable us to have a real say in how we want to be governed in Wales.

It is important to listen with tolerance to different points of view. Partnership is the key word for the success of the proposals contained in the Bill. I welcome clause 110, which requires the assembly to make a scheme for promoting local government in Wales, and to establish a partnership council for Wales consisting of members of the assembly and of local authorities. If our communities are to benefit from the establishment of a Welsh Assembly, it must have a strong, firm working relationship with democratically elected bodies in those communities. We must understand our communities and get the best deal possible for all the people, because they will be paying for and receiving services provided by the assembly and local authorities.

Communities and their needs differ greatly within Wales. In Conwy, tourism and agriculture are extremely important. I know that the Secretary of State and his Ministers understand fully the points that I am making.

Mr. Hain

I am glad that my hon. Friend mentioned tourism, which is vital in her part of Wales. Does she agree with me that the Welsh Assembly will provide a platform for Wales to market itself in Europe, Britain and internationally, which will give additional benefits to areas such as hers, and will ensure that Wales is put on the map in a way that it never has been before?

Mrs. Williams

I whole-heartedly agree with my hon. Friend. People in my constituency and in neighbouring authorities who depend on tourism will look to the Welsh Assembly, and will look favourably on the proposals in the Bill.

The needs of the people working in tourism and agriculture can be fully understood only by representatives that have been elected democratically by those communities. That is why partnership and constant dialogue is paramount if we are to succeed as a nation. The Bill cements that dialogue.

The Bill acknowledges the importance of the voluntary sector. Those of us who have been involved in local and national politics for a long time understand that voluntary organisations are the backbone of our society and communities.

Mr. Evans

Will the hon. Lady give way?

Mrs. Williams

I am running out of time, so I shall not give way.

Without the dedication of voluntary workers in our communities, the previous Government's care-in-the-community proposals would not have got off the ground. When in government, the Conservative party cut to the bone the finances of social services, health, education and other services that are important to our people. Hard-working voluntary workers deserve to be properly recognised at long last, and they are mentioned in the Bill.

Since the Government were elected on 1 May, they have taken long, determined strides towards more open government. There is a long way to go before many of us will be satisfied. Several clauses in the Bill refer to more open government, which the Conservative party would not understand. Surely those proposals should be welcomed by hon. Members on both sides of the House.

I am sure that it would come as a great surprise to my hon. Friends if I failed to refer to clause 62, which requires the assembly to establish committees for north Wales and for each of the other regions of Wales. The function of such committees will be to give advice to the assembly about the regions with which they are concerned. In north Wales, we welcome that provision.

I represent a part of Wales that has been neglected for a long time, that needs the right type of inward investment, where the nature of its rural communities has been neglected, and where the railway system is inadequate. I could go on. I am convinced that the proposals in the Bill are the way forward: they are exciting and far reaching. The people of north-west Wales needed these proposals yesterday, not in two years' time. They offer the people of Wales the opportunity to build a dynamic, successful, yet caring and compassionate society for Wales within the United Kingdom. I hope that the House gives overwhelming support to this historic document.

8.56 pm

Mr. Lembit Öpik (Montgomeryshire)

The Liberal Democrats are wholly behind the proposal for devolution in Wales. It is courageous of the Government to risk giving Welsh people responsibility for their own future. We believe that this experiment is destined to succeed.

I shall limit my comments to considerations of the economy, regional development and the regional structures that will be required for the successful development of Wales. I should also like to make a brief foray into some of the concerns that have been expressed by Conservative Members, who still seem unable to understand the benefits that a democratic structure and devolved system of government will bring to Wales.

In the past 15 years, many aspects of the Welsh economy have improved. The growth of manufacturing employment has outpaced that in the rest of the United Kingdom in the past 10 years. Since 1983, Wales has been one of the few regions of Europe to increase manufacturing employment. Certain sectors, such as the electronics and automotive sectors, have benefited still more from inward investment. The main driving force has been the big improvement in manufacturing productivity. That was despite a Conservative Government.

In fact, perhaps because we had a Conservative Government, some long-term forecasts suggest that Wales may remain one of the UK's poorest regions for some time. Benchmarking Wales against the rest of the UK suggests that its GDP per head is 17 per cent. below the UK average, even in the face of poor medium-term trends in the 1990s for other parts of the UK. Household income is 14 per cent. below average; average full-time earnings are 10 per cent. below; and in some parts of Wales they are as much as 20 per cent. below average. Economic activity is, on average, 8 per cent. below the UK average rate. Those figures are not much to cheer about, and they form a powerful reason for giving Wales economic autonomy to a greater or lesser extent.

There are four specific areas in which Wales can take the creative lead in the UK on rural and environmental policy within a general economic framework. If that is to be achieved, there must be a devolved assembly to make the right decisions. The four areas are: integrated rural policy; a strategy for food; a strategic environmental planning policy; and the initiation of a system of environmental duty. One must first consider what Wales needs. It definitely needs an economic policy that is sympathetic to the environment. Therein lies my first criticism of the Bill. It has not taken sufficient note of the environmental opportunities that are open to Wales.

Mr. Ron Davies

The hon. Gentleman will recall that, when I opened the debate, I said that the Government intended to table amendments. One of those will most certainly place a duty on the assembly to have regard to the principle of sustainability. We are currently consulting, and I invite the hon. Gentleman to let us have his observations. If he wishes to make written submissions on behalf of his party, we shall consider them and include them, if we can, in a new clause or an amendment.

Mr. Öpik

I welcome the Secretary of State's offer, and I assure him that we shall take it up. His suggestion is welcomed not just by the Liberal Democrats, but, I am sure, by the Royal Society for the Protection of Birds and the many other organisations that have lobbied us. I am sure that they will also be willing to contribute.

Dr. Marek

Does the hon. Gentleman agree that the Secretary of State could go a little further and publish some of his draft proposals, so that we may comment on them? The assembly will be open and we are to have a freedom of information Act, but of course at the moment the civil service and Ministers work in the same old way as the people in the previous Tory Administration. Before my right hon. Friend chides me, perhaps I should say that it is not quite as bad as that. I am not being at all critical. There is a case for exposing such drafts of policies, and that might be a useful way to get consensus on the issue.

Mr. Öpik

I welcome that suggestion. Contrary to what Conservative Members have said, it is encouraging that, during the Bill's evolution, the process has been inclusive. That happened before the election, and between the election and the publication of the Bill. I hope that it will continue as we approach the election of members of the assembly. Any move that opens discussion and allows all interested parties to participate is a welcome addition to the process of inclusive politics and constructive opposition.

Mr. Ron Davies

My hon. Friend the Member for Wrexham (Dr. Marek) does not need my invitation to express his view. I welcome the comments by the hon. Member for Montgomeryshire (Mr. Öpik) about the Government's inclusive style. Just before Christmas, there will be a meeting of the Green Alliance which, as he knows, consists of environmental groups in Wales. It will come as some surprise to my hon. Friend the Member for Wrexham to know that the old regime does not apply in Wales, because a senior civil servant from the devolution unit in the Welsh Office will meet the Green Alliance to discuss our thoughts on how an amendment should be phrased.

Mr. Öpik

I am delighted to hear that. If the public transport system in my neck of the woods were more effective, I might endeavour to turn up. However, as I have a smelly old diesel vehicle, I might have to steer clear, and cycling to Cardiff is perhaps beyond my physical capabilities.

I should like to speak a little more about some economic issues. There was some discussion about the Barnett formula. I understand that there is no reason whatever to assume that Wales will be worse off under that formula simply because it has a devolved assembly. I understand that under the Barnett formula money can rise or fall, and that the formula could be completely changed. However, that is separate from the issue of having a devolved assembly.

Mr. Wigley

Did the hon. Gentleman hear Lord Barnett say on Welsh television some three weeks ago that, if the Barnett formula were reviewed now, Wales would almost certainly be better off under that review than under the present formula?

Mr. Öpik

I did not see the interview to which the right hon. Gentleman refers, but I have no doubt that that is true. Who better than Mr. Barnett—[HON. MEMBERS: "Lord Barnett."] I tend not to recognise these heady titles. Coming from the Republic of Estonia, my parents, of course, never had to try to recall such privileges.

Mr. Rhodri Morgan

Would it not be for the benefit of the House if the hon. Gentleman commented on the fact that the Barnett formula was originally invented in the late 1970s to cope with the anticipated devolution, which never took place because of the referendum result in 1979? Therefore, it would be the height of absurdity to claim that democratic devolution is a threat to the Barnett formula, as that is what the formula was devised to accommodate in the late 1970s.

Mr. Öpik

Again, the hon. Gentleman makes a very good point. In other words, we have been here before and, at that time, there was no danger to the Barnett formula from the simple virtue of introducing a democratic process.

Mr. Hain

May I remind the House that, today, the Chief Secretary to the Treasury published a statement reaffirming the Government's commitment to the Barnett formula? Were it to be revised, in all likelihood Wales would benefit, because, under the Conservative Government between 1979 and 1997, Wales's gross domestic product fell relative to the English average, as a result of which, in any revision, Wales's overall block assessment is well placed to be uprated. Of course, the Barnett formula covers the percentage change in the block, not the total block, as it were.

Mr. Öpik

I welcome this continuing good news from all around me in the Chamber on the Barnett formula. Indeed, I am beginning to fear that Wales will be awash with money, with the changes that have been described.

Mr. Andrew George (St. Ives)

We shall get some more good news if my hon. Friend keeps going.

Mr. Öpik

Indeed. I should keeping going until Wales is the wealthiest part of Europe.

Mr. Jenkin

rose—

Mr. Öpik

I shall happily give way for, I hope, further good news, this time from the Conservative party.

Mr. Jenkin

I should be extremely grateful if the hon. Gentleman took the trouble to turn up at the Second Reading of the Bill on the government of Scotland to make all these explanations, and to make clear what he has discovered today, so that Scottish Members are equally well informed about the future of the Barnett formula and the likely effects on Scottish spending.

Mr. Öpik

I am grateful to the hon. Gentleman for his generous offer, but as a humble, relative new boy to the House, I believe that even the Öpik empire does not extend yet to Scotland. However, I shall pass those comments on to my colleagues north of the border.

It is interesting to note that the Barnett formula has not, as the Minister pointed out, taken account of the 10 per cent. fall in GDP over the past decade—I believe that that is in real terms—and that needs to be addressed.

Clearly, and without dwelling on it, there is a serious crisis in the rural economy, brought on not least by the most recent announcements by the Government—which I personally regard as regrettable—on the sale of beef on the bone. A Welsh Assembly could be regarded as an opportunity to lobby directly for the rural interests of those agricultural communities. Let me stress that Wales, perhaps more than any other part of the United Kingdom, is experiencing the deepest hardship in its rural economy on account of the proposals that have been made.

Mr. Denzil Davies

The hon. Gentleman raises an important point about beef on the bone. As I understand it, if the Bill is passed, the agricultural powers of the Welsh Office will end up in the Welsh Assembly. Does he understand that, in that situation, if an English Minister of Agriculture banned beef on the bone, a Welsh Assembly might not have to ban it?

Mr. Öpik

The right hon. Gentleman makes an interesting point. The Liberal Democrats are deeply concerned about the limitations on the assembly's powers. We would like it to have primary legislation powers, which would provide a greater opportunity for Wales to fight its corner without endless reference to Westminster.

Mr. Denzil Davies

I want to make my position clear. Is it the hon. Gentleman's understanding of the Bill that, if the English Minister of Agriculture was able to ban by order—not primary legislation—beef on the bone, as appears to be the case, a Welsh Assembly would not have to pass such an order, and people in Wales could continue to eat beef on the bone?

Mr. Öpik

We could certainly do that in secret, but I shall give way to the Secretary of State to clarify the point.

Mr. Ron Davies

My right hon. Friend the Member for Llanelli (Mr. Davies) makes an interesting and persuasive case. If powers to make orders relating to animal or human health were transferred to the assembly, my right hon. Friend's point would be correct. However, it is likely that the draft order that we shall produce, certainly in good time for the Committee stage, when we can have something more than a wide-ranging discussion on these issues, will make it clear that matters relating to animal or human health are likely to be reserved. Currently, the sort of order referred to by my right hon. Friend is made jointly by the Minister of Agriculture and me, as Secretary of State for Wales. Such an order is likely to continue, without those powers being transferred to the Welsh Assembly.

Mr. Öpik

I am guided by the right hon. Gentleman's statement, and I thank him for the clarification—

Several hon. Members

rose—

Mr. Öpik

I want to move on, as other hon. Members wish to speak.

Mr. Letwin

I am grateful to the hon. Gentleman; I do not want to delay him unduly. Does he realise that an enormous hole has now been blown in his argument? If, as the Secretary of State has assured us, the Welsh Assembly will not have the slightest control over the matter, how on earth will it help the Welsh people, in respect of beef on the bone and other issues, to have a Welsh Assembly?

Mr. Öpik

I want to make some progress—[Interruption.] I shall briefly answer the question head on.

If the Welsh Assembly genuinely has the opportunity to represent the interests of Wales in the European forum—which to a greater or lesser extent is the case—there is no doubt that, if we were to achieve a phased lifting of the beef ban across the United Kingdom, not only would Northern Ireland have a good chance of being first in such phasing, but Wales would have a good chance of having its ban lifted earlier than the rest of the United Kingdom—[Interruption.]

Opposition Members deride that comment. If they choose to reject my point, they are simply rejecting the efficacy of a devolved system of government. Many times they have said that they have little faith in a devolved system, but I cite the great belief of people in Scotland in a devolved system. They believe that they can make decisions in the European forum as well as in the United Kingdom forum. I also cite the guidance that we had today from the Secretary of State that that will, to some extent, be the case. It is something that we can discuss at greater length as the Bill proceeds.

I want briefly to make the point about proportionality, which has been made many times before. We support a different system of election, but as the Bill is unequivocal on the proposed system, we reiterate once again our plea to increase the proportional nature by adding 10 additional places. I shall not rehearse arguments that have been made many times before, but we genuinely believe that there is plenty of evidence that that would achieve a more proportionate outcome.

We accept the Secretary of State's unequivocal commitment, in writing, that the issue will be reviewed if it turns out that the system that has been chosen is not proportionate. We welcome that longer-term commitment to finding a proportionate system.

We must be clear about regional development agencies, and about the political structures across Wales. Economic and political autonomy will have to be clearly defined within the context of the Welsh Assembly. We cannot overestimate that matter.

I very much agree with the hon. Member for North Essex (Mr. Jenkin) that the majority in the referendum was insufficient for us to assume that everyone in Wales was completely comfortable with a Welsh Assembly. Liberal Democrats very much believe that a regionalised system that is transparent and devolves decisions to the regions of Wales will go a long way towards allaying many of the fears.

No speech by me would be complete without mention of an integrated transport system, with strengthened and improved road networks consisting not of new roads but of improved roads; a more coherent approach towards an integrated rail network, with heavy emphasis on shifting freight from road to rail; and a regional air network. I am delighted that Ministers have now acknowledged the importance of a regional air network and I hope that that will continue to be an important priority in the coming months and years.

I should like to make a few comments about the criticisms and concerns of those who are still unwilling to accept the case for a Welsh Assembly—or even the result of the referendum. In a rather dramatic intervention, the hon. Member for New Forest, West (Mr. Swayne) reaffirmed the Conservative party's commitment solely to the first-past-the-post system. How ironic, therefore, that Conservative Members singularly rejected the first-past-the-post referendum result. There are no quotas or thresholds in general elections, and I have never heard Conservative Members call for them.

Dr. Julian Lewis

Will the hon. Gentleman give way?

Mr. Öpik

I shall in a moment, for the last time. Oh—it is the hon. Member for New Forest, East (Dr. Lewis).

How can Conservative Members expect to be taken seriously when—after the event—they whinge about the process simply because they did not like its outcome on 18 September?

Dr. Lewis

May I point out to the hon. Gentleman—in my fourth intervention in the debate—the difference between a vote on an issue of immense constitutional significance and a straightforward vote in a general or any other election? The only reason why Conservative Members were not able to propose a threshold is that debate was guillotined. The Conservative party did propose a threshold in the other place.

Mr. Öpik

Let me put the hon. Gentleman out of his misery. He has ignored the fact that, whereas decisions on legislation and policies governing the United Kingdom are tactical, the biggest decision that we make in the United Kingdom is electing a Government, who facilitate everything else. Therefore, when he implies that a constitutional decision is somehow greater, he ignores the fact that the Government facilitate those very constitutional changes. He can continue that line, but he is mixing up the tactical and the strategic. If he continues in that manner, I should very much like to hear—although not in an intervention in this debate—how he wants to change the United Kingdom's electoral system. If he is implying that we need to introduce a proportional representation system to elect the Government, I very much welcome his point.

I assume that the hon. Gentleman, as he is a member of a party of great principle, will encourage his party not to offer a single candidate under a list system, which it believes is undemocratic—although I do not imagine for a moment that that will happen.

On funding, the hon. Member for Poole (Mr. Syms) made some important, reasonable points about the size of the pot, echoing concerns that have also been expressed by those of us on the Liberal Democrat Benches.

Mr. Ron Davies

Before the hon. Gentleman leaves the issue of the Conservatives and the electoral system, is it his understanding that, under the present arrangements, it is most unlikely that the Conservative party would ever get elected according to constituency selection? Does he agree that it is only under the additional list system that the Conservatives are likely to have any representation in Wales?

Mr. Öpik

The Secretary of State makes the point that has been reiterated on many occasions, but apparently it has not been heard by those who stand to gain the most from a change to a fairer system of election. Believe or not, I would welcome the introduction of a system of election of assembly members that offered advantage not only to the minority parties in Wales, but to the non-existent party in Wales, the Conservative party.

Mr. Jenkin

rose—

Mr. Öpik

I shall give way, but for the last time.

Mr. Jenkin

Can we take it that the only reason why the Liberal Democrat party supports proportional representation is that it believes that it does better under that system than under the present first-past-the-post system that we have in the House of Commons? If so, and given that the Conservative party will put up candidates for the Welsh Assembly under PR, is he not being hypocritical by standing for this Parliament under a first-past-the-post system?

Mr. Öpik

The hon. Gentleman's second point is entertaining but entirely illogical, and his first point is perhaps even more amazing. If there is one party that stands to lose its status of importance in Scotland and Wales through the introduction of PR, it is the Liberal Democrat party, and if there is one party that stands to gain from its introduction in Scotland and Wales, it is the Conservative party. Although it might be difficult for some hon. Members to accept, the Liberal Democrats continue to support the change to fair votes out of principle rather than out of self-interest.

As I said, the hon. Member for Poole made some interesting comments about funding. We, too, have argued about that on a number of occasions. We proposed that the assembly should have tax-varying powers, and we regret that it will not. As I said in an earlier intervention, money could be found in other ways, for example, by replacing quango appointees with elected representatives of the assembly. That could save many millions of pounds—the upper estimate is a saving of as much as £24 million, although I have not corroborated that figure. Currently, there are 1,400 quango appointees in Wales and 1,273 councillors. In other words, there are more unelected appointees than elected councillors. Surely there is money to be saved by replacing those appointees.

Hon. Members have also asked about how we shall invest in the priorities that matter. The answer, as the hon. Member for Poole acknowledged, is by changing those priorities. A repeated anxiety is that the assembly will destabilise the Union. Five words negate that concern—the United States of America. It is one of the most stable nations in the world, yet it is governed according to a federal system. It is unquestionably because of that federation and the acceptance of cultural variation, even law-making variation, across the United States, that that enormous nation is effective.

It has also been argued that the assembly would be bad for business. I simply do not accept that and, once again, the United States' experience seems to negate that argument. It is a laudable act of faith among those who will run the assembly that they will be able to devolve decisions to the regions of Wales, which will provide the impetus for success. The Development Board for Rural Wales is a classic example of having regional autonomy has helped to reinvigorate an ailing economy.

The location of the assembly has also been mentioned, and if I may add my tuppenny worth, I see no reason why the home of democracy in Wales, Machynlleth, should not be chosen, provided that the road network was greatly improved.

Mr. Donald Anderson

Everyone understands the hon. Gentleman's need to press for his own little area, but is there available in Machynlleth a meeting place of sufficient prestige with sufficient seating capacity, which could be available by May 1999, as Swansea guildhall would be in a cost-effective way?

Mr. Öpik

Without entering into too parochial a debate, I can guarantee that, for £14.5 million, I would build it myself.

Mr. Anderson

In time?

Mr. Öpik

Oh, yes, in the time available.

I apologise for having taken so much time, Mr. Deputy Speaker, but I want to raise a few points about the closed list system. We share the concern of the official Opposition that such a system carries the danger of party patronage. Even if that difficulty could be resolved, a problem of public perception would remain and assumptions would be made about jobs for the boys. We cannot constructively pursue that argument here on the Floor of the House, but I hope that we shall be able to debate it in subsequent stages of the Bill.

Mr. Hain

I am grateful to the hon. Gentleman for giving way, especially as he has been so tolerant of interventions. If—as is likely to be the case both for the Labour party and for his own—the selection of candidates in the list is determined by one person, one vote among the electorate, does the hon. Gentleman agree that that would create conditions in which democracy prevailed to a far greater extent than is suggested by the "jobs for the boys and girls" syndrome?

Mr. Öpik

The Minister suggests a compromise solution that is far better than a simple closed system, which the public might suspect of being a set of appointments for the party faithful. Nevertheless, we still prefer the concept of an open list, although we can talk about the details at a later stage. I reiterate that my reason for saying this is that we must have a strategically transparent system for electing assembly members, so that no one can believe that certain individuals are there only as a reward for party activities and not primarily for the interests of Wales.

My final point about the electoral system relates to clause 5, which has caused some confusion. It is not entirely clear to me whether it precludes an individual from standing in a constituency as well as in a list. I should be grateful if the Minister clarified that point of interpretation when he sums up the debate tomorrow.

I have tried to cover a few specific areas, but I shall conclude on a broader point relating to the attitude of those in the Chamber tonight towards the introduction of a devolved assembly. It seems that there are those who still do not accept that, at the end of the day, devolution is a reasonable act of faith in the people to whom the responsibility is to be devolved. I once saw a wonderful cartoon, in which a father angrily asked his son, "How can you act so irresponsibly?" to which the son replied, "But Dad, that's how irresponsible people act!" In the same way, if we tell the Welsh people, ad infinitum, that they are incapable of governing their own affairs, they will live down to that expectation. However, finally—thankfully—on 18 September, enough people in Wales decided to believe in the national spirit to vote for the national devolution that we are now debating.

In the Greece of 2,500 years ago—a country with few resources and a small population—the people showed great vision and achieved far greater success than would ever have been predicted for them. Fifty years before that success, there was a substantial political reform that set in place the democratic opportunities and processes that led to the creation of an empire.

I am not suggesting that the Welsh will roll across the marches and take over Shrewsbury, however much those who live near the marches might want that to happen. I am suggesting that, with the opportunity of an assembly from 1999, Wales can express its own culture as it has never done before, and it can allow its language to thrive in a way that would not have been thought possible half a century ago. Wales will be able to experiment with its political structures in a way that seemed impossible even 20 years ago. Perhaps above all else, Wales will be able to create an economic climate that adds to the great success that the Welsh Development Agency has already had in acquiring foreign investment and foreign trade.

It may not be known by many hon. Members, but Wales already has its own space programme, called project Dragon Fire—

Mr. Evans

No doubt it operates from the hon. Gentleman's constituency.

Mr. Öpik

Yes, the hon. Gentleman is correct: it operates from my constituency. Its self-styled leader operates from a pub called The Bell, and hon. Members are most welcome to come to meetings of CASA—Cymru Aeronautics and Space Administration. Contributions from the Government would be most welcome.

If there is one message that must come out of this Chamber to Wales, it is that Westminster has ascribed to Wales the authority to define its own future. It is that self-belief that will make the attitude that goes with the structures of democracy a success. If, after the debates that we are having here today and tomorrow, and as the Bill proceeds, we all pursue that objective constructively, we can have not only an effective, inclusive, cross-party consensus where differences of opinion are respected and welcomed, but a Wales which, in 10 or 15 years' time, will be the pride of the United Kingdom and the envy of the world.

9.31 pm

Mr. Martin Caton (Gower)

Thank you, Mr. Deputy Speaker, for calling me in this important debate about beginning the process of decentralisation in Britain and of democratisation in the governance of Wales.

A clear understanding of what happened on 18 September is essential if we are to debate the Bill constructively. Quite simply, the people of Wales made a decision: they decided that they wanted to move away from rule by Whitehall outpost and quango archipelago; instead, they voted for government of the Welsh people for the Welsh people by the Welsh people. They voted for a directly elected Welsh Assembly, the "National Assembly of Wales" described in the Bill. They voted for democracy in the democratic process that was the referendum.

It is very depressing to hear Opposition Members sneering at that democratic process and, having lost the argument and lost the vote, saying, at worst, that we should ignore the result or, at best, interpret it to mean something other than the go-ahead for the Government's proposals as described in the White Paper. That democratic process and that referendum cannot and must not be treated in such a cavalier fashion. Neither turnout nor closeness of result can seriously be used to argue that the Bill should not be approved substantially unchanged if we are to respect what the people of Wales have said.

In fact, the turnout on an old register in a poll held at the end of the summer was far higher than is achieved in local government or European elections across the whole country. Should we, therefore, scrap our local authorities or not send representatives to the European Parliament? Some people argue that there should have been a threshold—we have heard that argument today. If we are honest, we know that the only people who argue for thresholds in such referendums are people who want to prevent change. A threshold is fundamentally undemocratic and possibly anti-democratic because it adds anyone not voting, for whatever reason, to the number of votes cast for one side of the argument.

That is the twisted logic of the Conservative Members who repeatedly preface their questions with, "As 75 per cent. of the Welsh people do not support the assembly". It is nonsense. Without compulsory voting, democratic decisions must be taken by the people who exercise their right to vote, and fairness demands that a simple majority must decide the question.

Dr. Julian Lewis

For the fifth time, I argue that Labour Members do not accept that, when a vote takes place on an issue changing the constitutional rules of the game, the criteria for changing those rules should be higher than a simple majority. That is a constitutional safeguard in many democracies throughout the world, and it should have been a constitutional safeguard in this case.

Mr. Caton

I understand that argument, but I do not agree with it. By imposing a threshold, one defends the status quo. Unfortunately, when we examine the Conservative Government's record, we find that they were prepared to impose thresholds to secure yes votes on some issues. When they were trying to remove council housing from local authority control, they imposed a threshold to shift the balance towards the yes votes. The Conservatives are not consistent in defending the status quo with thresholds.

There is an argument for thresholds, but I do not agree with it. I believe that a democratic decision should be taken on a simple majority vote, whether it be in an election for a Government or for a change of structure.

Mr. Donald Anderson

I remind my hon. Friend of another example that shows that the Conservative party may be less than consistent—ballots in respect of grant-maintained status for schools. In a ballot in my constituency, despite a very small turnout and a minuscule majority, a school became grant-maintained. Therefore, for the Conservative party it is a matter not of principle but of what happens to suit its purpose at any moment.

Mr. Caton

That is absolutely true, and I thank my hon. Friend for making that point. Indeed, if we are thinking of ballots on grant-maintained status, the very fact that parents of children from feeder schools were excluded from the democratic process is another example of vote rigging by the Conservative party.

Mr. Peter Bottomley (Worthing, West)

rose—

Mr. Owen Paterson (North Shropshire)

rose—

Mr. Caton

I give way to the hon. Member for Worthing, West (Mr. Bottomley).

Mr. Bottomley

The hon. Gentleman will agree that the Welsh assembly—

Mr. Nick Ainger (West Carmarthen and South Pembrokeshire)

The hon. Gentleman has just come in.

Mr. Bottomley

I have not.

The hon. Gentleman will agree that the decision to set up a Welsh Assembly is more important than the conversion of a building society from mutual status to profit earning. Why does he support the Government, who say that a building society seeking to convert needs an absolute majority, but a referendum for a Welsh Assembly does not?

Mr. Caton

The circumstances are very different. When attempts are made to bring about changes that will affect the interests of the members of a building society, who have joined for a purpose, those interests should be protected. That is a very different matter from changes in the general democratic process in a country, whether it be changes in structure—constitutional change—or the election of a Government, a council or Whatever.

Mr. Ron Davies

I encourage my hon. Friend to continue to be robust in rejecting the arguments of Conservative Members. Will he reflect on the fact that those arguments would have more credibility now if they had been advanced during the passage of the Referendums (Scotland and Wales) Bill? Conservative Members had every opportunity to table amendments to ensure that there was a threshold. Will my hon. Friend reflect on the fact that, because Conservative Members refused to do so then, the arguments that they are making now are spurious?

Mr. Caton

My right hon. Friend is absolutely right. [HON. MEMBERS: "Oh, no, he isn't."] Oh, yes, he is. As my hon. Friends have said, we fought the referendum on a set of rules. We complied with the rules. Everyone knew those rules during the referendum process.

Mr. Gareth Thomas

Is not this an illustration of parliamentary sovereignty in operation? Tonight, we have heard much from Conservative Members about parliamentary sovereignty. Does my hon. Friend agree that Parliament determined the rules within which the referendum would be conducted and that Parliament, exercising its sovereignty, determined that there should be no threshold?

Mr. Caton

My hon. Friend has made the point rather better than I managed to.

Mr. Paterson

The hon. Gentleman says that constitutional change should be made by majority. Does he agree that the British constitution belongs to all the people, and that it is a denial of democracy to have excluded 85 per cent. of the electorate from the referendum?

Mr. Caton

The hon. Gentleman does not seem to understand what those of us who had a vote were voting on. We had, and have, devolved government in Wales, in the form of the Welsh Office. It has considerable powers. All that we voted for on 18 September was to make its powers accountable to the people of Wales. That was rightly a decision for the people of Wales.

Dr. Liam Fox (Woodspring)

The hon. Gentleman claims that changing the status of a building society requires an absolute majority, but changing the economic status of our nation—as, for instance, with economic and monetary union—requires a simple majority of one. Is that the logic of his argument?

Mr. Caton

That is an interesting question, but I have made my case. [Interruption] That would indeed be my position. [Interruption]

Mr. Deputy Speaker (Mr. Michael J. Martin)

Order. The hon. Member for Worthing, West (Mr. Bottomley) is being far too noisy.

Mr. Caton

I am happy to give way next to the Minister.

Mr. Hain

Parliament decided in the summer to hold an advisory, consultative referendum. Conservative Members have missed the point, which is that Parliament retained its sovereignty in the matter. It decided not on a binding referendum but on a consultative one. It therefore makes perfect logical sense to require a simple majority—which is what it was.

Mr. Caton

That is a good point. As for the wider British electorate's involvement, on 1 May the British electorate were of course involved. The Labour party fought the election on the idea that we would offer the people of Wales and of Scotland democratically elected and devolved government. They had their say then.

Mr. Donald Anderson

Another factor is that the party that claims to be the party of the Union would have been well on the way to destroying that Union if the clearly expressed views of Wales and Scotland had been overwhelmed by an English vote. Indeed, there could be no better recipe for the break-up of the union than if Wales and Scotland had been denied the constitutional settlement that they wanted.

Mr. Caton

My hon. Friend is absolutely right. That is another reason why thresholds are so dangerous. If a simple majority vote for a particular course of action and are then denied the ability to take that course by the threshold mechanism, unrest is created.

Mr. Wigley

Is not the logic of these tedious Conservative interventions the idea that there should be a threshold for our Westminster votes as well? Are the Tories seriously advocating such a dramatic change in our practices here? They look bemused. It seems that they want to lay down thresholds for others, but not to entertain the idea here.

Mr. Caton

The right hon. Gentleman makes a useful point.

I wish to refer to the advisory nature of the referendum. As a Member of Parliament, I feel honour-bound to listen to the people of Wales. That is why I believe that we should not move too far away from the substance of the White Paper, as that is what the people of Wales voted on. That is not to say that there is no opportunity for change or debate. I confess that I have concerns, for instance, about the closed-list system in the electoral process; such matters should be debated in the Chamber and in Committee. I am pleased that the Bill so accurately reflects what we voted for in the referendum.

I do not intend to take up too much time by repeating points that were made during debates on the Referendums (Scotland and Wales) Act, which were central to the debate in Wales during the summer campaign. Instead, I should like to address three specific matters: first, the future of the quangos; secondly, the committee structure that will emerge from the commission's drawing up of draft Standing Orders, and their consideration by my right hon. Friend the Secretary of State; and thirdly, the right of consultation by representatives of interest groups in Wales.

First, on quangos, some of my hon. Friends were disappointed that the White Paper did not go beyond dealing with the Welsh Development Agency, the Development Board for Rural Wales, the Land Authority for Wales and Tai Cymru. I suspect that they were disappointed with the contents of the Bill. I do not share their disappointment.

Mr. Win Griffiths

My hon. Friend is right to list the quangos to be dealt with by the Bill. However, he needs to remember that, under the existing powers, the Health Promotion Authority for Wales, the Welsh Health Common Services Authority, the Cardiff Bay development corporation and the residuary body will all be out of the way. We are currently carrying out the reconfiguration of trusts in which a substantial number of those will also disappear.

Mr. Caton

I thank my hon. Friend for making that point.

I was involved in the development of devolution policy by the Welsh Labour party. I cannot remember a time—from early drafts onwards—when we were not looking at giving the assembly the main job of examining the functioning of the quangos. I have no problem with that, and I can see that the various bodies mentioned by my hon. Friend the Under-Secretary must be dealt with urgently. However, it would be wrong for us to say to the assembly, "You are in charge of how the quangos function and you must make sure that they are transparent, accountable and more effective than what we had before," while imposing a fait accompli on the assembly.

It is the job of the assembly to look at how the quangos in Wales function and to improve them. In that sense—and although some of my hon. Friends may feel that all we have is a campfire of the quangos—we are handing over the matches and the firelighters to the assembly to continue the work of democratising Wales.

Mr. Ron Davies

I want to ensure that my hon. Friend fully understands the rationale of the Government's position, which is quite compatible with the Labour policy that he was instrumental in forming. It is a central requisite of the devolution policy that the assembly should be fully empowered to deal with all the public bodies to which my hon. Friend has referred. In the case of the Welsh Development Agency, for example, the assembly will be fully empowered to carry forward any further changes.

The Government took into consideration the uncertainty and delay that might have adversely affected the work of bodies such as the WDA, if, at this stage, we said that in two and a half or three years the assembly would be empowered to carry out a restructuring. The Government's view was that the uncertainty hanging over the Welsh Development Agency, the Development Board for Rural Wales and the Land Authority for Wales made it imperative for us to take early action, so that the powerhouse could be created to carry forward the work of economic development in Wales.

Mr. Caton

I entirely accept the logic of that action. The creation of the powerhouse is important also because of the changes on the structural front emanating from the European Union. We need one organisation to cover all the functions previously dealt with by three.

My second concern relates to the committee structure that is to be developed for the Welsh Assembly. I note the intention to create subject areas covering all the matters listed in schedule 2. There are 18 of them: agriculture, forestry, fisheries and food; ancient monuments; culture; economic development; education and training; the environment; health and health services; highways; housing; industry; local government; social services; sport and recreation; tourism; town and country planning; transport; water and flood defence; and the Welsh language.

I recognise that all those matters must be covered by subject committees. My worry is that the commission and eventually the Secretary of State may plump for too many committees. With such large subject areas, there may be a temptation to go for a large number of committees, and thus more chairs, leaders, First Secretaries or whatever we will call them—more chiefs and fewer indians. That does not make for democratic government or for effective government. I hope that the Secretary of State will bear that in mind.

Mr. Wigley

Does not the Bill allow sub-committees to be set up for each committee? The committee may be both a supervisory committee for the Minister and a body akin to a Select Committee, given the powers that are available. Those powers may best be exercised through a sub-committee system, with a restricted number of main committees, and with sub-committees to focus on the detail to which the hon. Gentleman refers.

Mr. Caton

I thank the right hon. Gentleman. I hope that the commission and the Secretary of State will consider such an approach.

There has been some debate about whether the assembly should work according to a Cabinet system or a local government committee system. The Bill allows for a new and different system that combines the best of both.

Mr. Ron Davies

For the sake of clarity, I assure my hon. Friend that the advisory committee that will precede the work of the statutory commission will have a very wide remit. It can certainly consider the question whether the assembly operates on the basis of a Cabinet system or a local government system. I await the outcome with interest.

My hon. Friend referred to the list of functions in schedule 2. The purpose of the schedule is to make it clear that the Secretary of State will have the responsibility for laying orders transferring functions in those areas to the assembly. It is not meant to be a prescriptive list of the committee structure. I agree with my hon. Friend, and the point was made by the right hon. Member for Caernarfon (Mr. Wigley), that there might be six, eight or 10 committees, rather than the entire list in the schedule.

Mr. Caton

I thank my right hon. Friend for those helpful remarks, and I welcome the approach that he is likely to take.

As for the right of consultation for interest groups in Wales, like other hon. Members, I warmly welcome the provision in clause 110 that requires the assembly to draw up a scheme to sustain and promote local government. I particularly welcome the creation of the partnership council. The key to better government in Wales will be the right relationship between the two tiers of democratic representation in our country. Councillors and local authority employees have expressed fears that the assembly may seek to take over their responsibilities. Those fears have been aired in the Chamber today.

I believe that the White Paper did much to dispel those concerns. However, the Bill—and, in particular, the creation of the partnership council—will inspire further confidence that the assembly is good news for local democracy, as well as for democracy at the all-Wales level. After 1999, the quality of most of our major public services and our ability to grow as a sustainable economy will be in the hands of both our new assembly and our local councils. With a dynamic and constructive partnership, things can only get better.

The responsibilities and structures for which the Bill provides establish an excellent base on which to build. I am also pleased to see the requirement in clause 111 for the assembly to develop a scheme to promote the voluntary sector. Voluntary organisations throughout Wales will welcome a structure in which the criteria for financial assistance, the ground rules for monitoring the use of resources and the methods of consultation are debated openly and decided.

However, I note that the Bill does not include similar consultation rights for the representatives of the main economic players: the employers and employees. Perhaps, in answering the debate tomorrow, the Under-Secretary will confirm whether consideration has been given to a statutory right of consultation for the social partners, either jointly, as a Welsh economic committee, or separately, as the Wales Trades Union Congress, the Welsh version of the Confederation of British Industry or some other appropriate representative organisation.

Mr. Hain

I draw my hon. Friend's attention generally to clause 64(3)—he need not consult it in detail unless he wishes to do so—which makes it clear that business will need to be consulted in terms of regulatory appraisals of any regulations that the assembly might introduce.

Mr. Peter Bottomley

On a point of order, Mr. Deputy Speaker. This is the third or fourth time that the Government's Front-Bench spokesmen have helped to pad out the speech by the hon. Member for Gower (Mr. Caton). Is it conventional to provide such assistance to an hon. Member as we approach 10 o'clock? Is the intention to exclude other hon. Members from speaking in the debate?

Mr. Deputy Speaker

The hon. Member for Worthing, West is making accusations. Interventions are perfectly within the rules of the House—that is why I have allowed them.

Mr. Hain

For the benefit of the hon. Member for Worthing, West (Mr. Bottomley), I was seeking to draw to my hon. Friend's attention the fact that clause 64 addresses precisely his concern that business should be consulted. We have issued an open invitation to business, the voluntary sector and several other interest groups in Wales to submit their agendas to my right hon. Friend's advisory committee—and thereafter to the statutory commission—to explain what relationship they want with the assembly. It is an inclusive process, which will extend to the opening of the assembly in 1999.

Mr. Caton

I thank my hon. Friend for that helpful intervention. I still recommend that thought should be given to the social partner approach to consultation with the economic players. Structures for consultation obviously help, but the culture of the assembly will be just as important. The electoral system, fair committee structures and rights to be heard will help to create a democratic body that is more constructive and inclusive and less confrontational than anything we have seen before.

Working practices are part of the answer but attitude is equally important. A heavy responsibility lies on the shoulders of our first elected assembly women and men. It will be their job to nurture a co-operative and consensual culture. The location of the assembly might help them to achieve that objective. The mind-opening significance of daring even to consider basing our assembly outside Cardiff has provided enthusiasm and excitement in Swansea and south-west Wales. That has been matched only by the arrogance of some statements from Cardiff-based media.

It being Ten o'clock, the debate stood adjourned.

Debate to be resumed tomorrow.