§ Queen's recommendation having been signified—
§
Motion made, and Question proposed,
That the Resolution of the House of 22nd May 1997 relating to Referendums (Scotland and Wales) Bill [Money] shall have effect as if—
§ Mr. Douglas Hogg (Sleaford and North Hykeham)On a point of order, Mr. Deputy Speaker—or rather, two points of order. The motion refers to a resolution of the house of 22 May 1997; we are being asked, in effect, to amend it. I have been to the Vote Office and asked for a copy of that previous resolution, and I have in my hand the only copy in its possession. In other words, any other hon. Member who goes there for a copy will be referred to me, which is hard luck. I put it to you that when we are asked to look at former resolutions, the Government should ensure an adequate supply of the relevant documents in the Vote Office.
My second and different point relates to the meaning to be attached to the phrase:
a Minister of the Crown".I assume that it embraces all Secretaries of State, Ministers of State and Under-Secretaries, but I would appreciate your guidance.
§ Mr. Deputy Speaker (Sir Alan Haselhurst)On the first point, the resolution should have appeared in Hansard and is thus freely available to all right hon. and hon. Members. The second point is one for debate, not for the Chair. We now have some time—admittedly limited—to debate the motion.
§ Mr. HoggFurther to that point of order, Mr. Deputy Speaker. I do not want to be tiresome, but the meaning of a phrase is a matter not for Ministers but for the Chair—this is a House document. I am only asking what "Minister of the Crown" means.
§ Mr. Deputy SpeakerWe are debating a Government motion, so the Chair should not rule on it. The right hon. and learned Gentleman may have a chance to catch my eye during the debate if he wants to expand on his point.
§ Mr. Michael Ancram (Devizes)I should like to ask a few questions about the motion because, although it is a money resolution, it deals with certain aspects of the Bill which, because of the previous timetable motion, were not discussed, and certain significant points must be clarified at this stage. It seems slightly odd, although I am told that it is the way in which the House proceeds, that we are dealing with amendments that are consequential upon amendments that we shall not be discussing, if we get 364 there, until the end of our debates on the Lords amendments. It is, however, relevant to raise these questions now.
The first question relates to the matter raised by my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg) in his point of order, which is the definition of:
a Minister of the Crown".If I read the amendments right, a Minister of the Crown will now be entitled to spend money, which previously had been the purview of the Secretary of State. It is for the consideration of the House as to which Ministers will be entitled to spend money on matters such as those set out in the resolution:(a) in connection with the referendum held by virtue of the Act, or(b) in the preparation of a Scottish Parliament or a Welsh Assembly.I presume that not every Minister in the Government would be entitled to spend public money and then claim that it somehow fitted under one of those two heads; I should be grateful if we could be told who those Ministers will be.Are there any limits to how much those Ministers might be able to spend under the provision? Can any Minister of the Crown issue, for example, expenditure certificates in connection with the forthcoming referendums? Who, at the end of the day, judges whether the expenditure is actually in connection with the provided purposes? Who is the arbiter of that expenditure and how will the system work? When expenditure was carried out by Secretaries of State, it obviously related to the Scottish Office or the Welsh Office and that was not a problem; but if it is spread much wider, we need to know who the Ministers are and what the limitations are.
Secondly, the deletion of the words "the establishment of', is another of the consequential amendments. I have read the explanation for that action given in another place and I understand that it is to allow for certain preparations that might not be strictly connected with the establishment of a Parliament building or a place for the Assembly, or for expenditure on matters such as preparing for the tax-varying powers of the Scottish Parliament. I heard what was said in the other place, and we all appreciate that some expenditure might go a little wider, but we need to know how wide. We are told that it is likely to be expenditure incurred by the Inland Revenue or the Department of Social Security, but within what time scale are they to be allowed to make that expenditure? What sort of sums are envisaged—large or small?
If the tax-varying powers are wider than they appear to be on the face of the Scottish White Paper, what control will there be over the expenditure? If other potential tax-raising powers are hidden within the words of the White Paper, can studies into those be contracted, which would be paid for under this provision of the money resolution? What limits would there be to that sort of work? Those are points on which we need to have information before the House can be satisfied that the matter has been fully thought through.
Finally, there is the question of the words that are not subject to the amendments, but which are within the resolution and closely tied to the amendments—the words, "provided by Parliament". What the money resolution says is that the expenditure, which can now be 365 incurred by any Minister of the Crown in connection with a widely drawn preparation for a Scottish Parliament or a Welsh Assembly, will be provided for by Parliament. What does that mean? Will the money come from the central Exchequer? Will it come from the Scottish and the Welsh blocks? If from the Scottish and Welsh blocks, will the blocks be as they are now, or will they be supplemented to pay for the expenditure?
What new calculations have the Government made of the preparation costs? In respect of the Scottish Parliament, we have had start-up figures of between £10 million and £14 million, but that was in the days before the powers were expanded as they have been in the money resolution. Presumably, those figures will now be greater. We should be told what estimate the Government make of the extra costs of preparing for the Scottish Parliament and the Welsh Assembly under the broader criteria.
We need assurances, not only about what the costs will be, but especially that none of the expenditure will be paid for by United Kingdom taxpayers. If the expenditure has to be incurred—the House knows that I would disagree with that suggestion—it should be paid for by people in Wales and in Scotland, and I should like a categorical assurance on that point.
§ Mr. Tam Dalyell (Linlithgow)I believe that it is reasonable to take the time of the House to ask a question about borrowing powers. I should have thought that any Parliament that calls itself a Parliament must be entitled to borrowing powers, and there are no limits, beyond those of what is politically acceptable, to the borrowing powers of the United Kingdom Government.
By contrast, there are very precise limits to the permissible borrowing of local authorities. Before their borrowing is included in calculations of the public sector borrowing requirement, it is ultimately controlled by the Treasury. It is inconceivable that similar restraints will not be imposed on a Scottish Parliament as, whether it has taxing powers or not, nearly all its revenue will come from Westminster, having been calculated as a share of the UK Government's revenue. Any borrowing that it is permitted will be part of the PSBR and controlled accordingly.
Is that a correct understanding of the position? Some people have great expectations of a Parliament in Edinburgh that has borrowing powers. Might that be clarified?
§ Mr. Douglas Hogg (Sleaford and North Hykeham)I should like to follow the points made by my right hon. Friend the Member for Devizes (Mr. Ancram). I draw the Minister's attention to three points and seek his clarification on them.
The first point relates to the requirement for an Order in Council under the Act. That is the first tiret. As I understand the existing money resolution, before an expenditure is authorised to be covered under the money resolution, the money must be authorised under the Act and approved by an Order in Council. In other words, the Order in Council was a condition precedent of the money being paid.
366 We are deleting that. In other words, I would suggest to the House, we are loosening the control that the House has of the money that is covered by the money resolution. In other words, expenditure can be incurred under the Act which is not covered by an Order in Council, and that is a wider class of money than would otherwise have been the case.
When the money resolution was first brought before the House, the Minister obviously had in mind a range of expenditure with, no doubt, a quantum attached to it. He has removed the condition precedent. That suggests to me a wider range of payments, and no doubt an increased quantum. What are the new categories that were not previously in his mind, and how much more shall we be asked to pay?
My second point relates to the matter that I raised with you, Mr. Deputy Speaker, on a point of order. I believe that the House is interested to know the meaning of the phrase, "Minister of the Crown". I well know the meaning of the phrase, "Secretary of State"—not just one, but any old Secretary of State—but what is the meaning of the phrase, "Minister of the Crown"? I assume that it includes a Secretary of State. I assume, too, that it includes a Minister of State. I suppose that it includes an Under-Secretary. However, the House is entitled to know what it means.
I suspect that the phrase means that any old Minister can give the authority; if that is right, we are diluting the authority of the Secretary of State or, more specifically, removing his accountability. Under the previous money resolution, only the Secretary of State could give the authority, but now any old Minister can do so; the Secretary of State can slough off responsibility by saying that something was said by his Under-Secretary and he did not really mean it.
That brings me to the final point made by my right hon. Friend the Member for Devizes, that we are removing the linkage in the second tiret, subsection (b), to "the establishment of a Scottish Parliament. When the money resolution was first before the House, it was fairly plain that it covered only expenditure linked to purposes
for the establishment of a Scottish Parliament".In a sense, one knew what that meant. The resolution was fairly limited; there is the establishment of a Scottish Parliament and thus consequential expenditures flowing therefrom. If we remove the phrase, "the establishment of', the resolution will read:in preparation for a Scottish Parliament".That is a very large slice of the cake of expenditure—a whole range of consequential expenditures in Scotland and Wales may be deemed necessary as a Scottish Parliament or Welsh Assembly is about to be set up. No doubt the Inland Revenue, the Department of Social Security, my old Department, the Ministry of Agriculture, Fisheries and Food, and many other Departments will say that, because a Scottish Parliament or a Welsh Assembly is about to be set up, further expenditure will be required.The House is entitled to know the new classes of expenditure that are now covered by the money resolution. I should be pleased to hear from the Minister his assessment of the increase in that expenditure. He no doubt has some figure in mind. We want to know what his previous assessment was and the assessment that he now makes of the increase. Both figures would be extremely helpful.
367 A lot more work remains to be done by the Minister to persuade the House about the desirability of the money resolution before hon. Members give their consent.
§ 5.1 pm
§ The Minister for Home Affairs and Devolution, Scottish Office (Mr. Henry McLeish)I should be pleased to answer some of the questions put by Opposition Members and by my hon. Friend the Member for Linlithgow (Mr. Dalyell). It is important to clear up first the question about Ministers of the Crown. The meaning will be wider than Secretary of State, because there may be expenditure by Departments not headed by a Secretary of State, for example, expenditure by the Inland Revenue on computer programmes to deal with tax issues. Much of the interpretation is common sense, but it seems to be lost on some Opposition Members.
The question of junior Ministers was also raised. Clearly, that is a red herring. In this respect, as in all others, junior Ministers take decisions only on matters referred to them by the Minister in charge of their Department. I should have expected that the experience of some Opposition Members would brush off on them to the point that they would understand what is going on.
We also heard some comments about the costs involved. The total estimated preparatory costs are £18 million to £25 million, as set out in the explanatory and financial memorandum. The money resolution does not change the facts laid before the House and discussed in the other place, which are now back in this House for discussion. DSS costs are included within that limit. All that will be conditional on the Supply process of dealing with money in this House. That, too, is well known to Opposition Members.
§ Mr. AncramIt would be much more helpful if the Minister did not simply refer us to the ordinary ways in which that is done, but categorically answered the question about whether any of that expenditure will be paid from sources outwith the Scottish and Welsh blocks and whether any expenditure will be incurred by United Kingdom taxpayers rather than borne by the blocks in Scotland and Wales.
§ Mr. McLeishThe right hon. Member for Devizes (Mr. Ancram) goes over old ground time and again. The answer is obvious: this settlement seeks to strike a balance in terms of Scots seeking to have a Parliament in Edinburgh. The Secretary of State is on record as saying that the costs of that will be borne by the block.
§ Mr. McLeishI am speaking about Scotland. Opposition Members should contain themselves. They ask questions, but they fail to give me an opportunity to respond. I have often told them that listening would be in their long-term interests, instead of carrying on as they have for the past 18 years. With great courtesy, I say that we can see where that has got them.
368 I shall deal with the request of my hon. Friend the Member for Linlithgow. Paragraph 7.10 on page 23 of the White Paper states:
The Scottish Parliament will have power to authorise the Scottish Executive to undertake short-term borrowing to assist in the short-term matching of income and expenditure. It will not have a long-term borrowing power on its own account.
§ Mr. Bernard Jenkin (North Essex)Can the Minister clarify his previous answer? If, for example, the Inland Revenue incurs additional expense while setting up the tartan tax, will it be recompensed from the Scottish block?
§ Mr. McLeishThe answer is self-evident. Labour Members do not call it the tartan tax. The Scots will be given the opportunity in the referendum on 11 September to choose whether the Parliament should have a tax-varying power. Of course, if costs are incurred via the Departments, they will come from the Scottish block. [Interruption.] The hon. Member for North Wiltshire (Mr. Gray) asks from a sedentary position why I did not say that. It has been said time and again. The questions have been posed before and answered reasonably.
§ Mr. HoggThe Minister referred to the Scottish block, and I understand why he is speaking about that. The principle also applies to the Welsh block. The House wants to know whether what is true of the Scottish block is also true of the Welsh block—in other words, whether any expenditure in Wales that is authorised directly or indirectly under the money resolution will fall on the Welsh block and not be paid by taxpayers outside Wales.
§ Mr. McLeishThe answer is yes, but the debate should be conducted in a more dignified manner. The Opposition would have us believe that the settlement is not in the interests of the United Kingdom. They take a mean-spirited view and discuss the issues in terms of the UK v. Wales, and the UK v. Scotland. The country does not want that level of debate. It wants to probe hard on questions of finance, but, after 18 years of the Conservative Government's financial controls, we will not take lectures from the Opposition Front Bench.
The amendments to the money resolution are required in consequence of two sets of amendments made to the Bill in another place. Both are purely technical.
The first amendment is required to take account of the incorporation of the detailed provision for the conduct of the referendum as a schedule to the Bill. Hon. Members will recall that, during the earlier stages of the Bill, we proposed that that should be dealt with by Orders in Council, as had been the case in previous referendums. At the request of Lord MacKay of Ardbrecknish in another place, we agreed that the change should be made. That will have the fortunate consequence of allowing the House and another place to rise this week, rather than having to wait simply to debate the Orders in Council. The amendment to the money resolution is purely technical.
The second and third amendments are also technical, and mirror amendments made in another place to clarify the scope of the finance provision in clause 5. Clause 5(2) allows expenditure in preparation for the establishment of a Scottish Parliament or Welsh Assembly to be paid out of money provided by Parliament. The intention is that that provision should cover not only 369 expenditure on the building or refurbishment of Parliament and Assembly buildings, but advance expenditure on, for example, any adjustment to Inland Revenue and DSS computer systems required to cope with the tax-varying powers of the Scottish Parliament.
Such changes have a long lead time and, if the tax-varying powers are to be available upon the establishment of the Scottish Parliament—whether or not the Parliament decides to use them—it may be necessary to incur expenditure before the main devolution legislation reaches the statute book. The amendments are intended to put beyond any doubt the question whether such expenditure would be covered by clause 5. The estimated costs shown in the explanatory and financial memorandum remain unchanged. All expenditure under the provision will be subject to the normal parliamentary rules of Supply.
§ Question put and agreed to.