DEVOLUTION TO SCOTLAND AND WALES

HL Deb 27 January 1976 vol 367 cc734-910

3.1 p.m.

Lord SHEPHERD rose to move, That this House takes note of the White Paper, Our Changing Democracy: Devolution to Scotland and Wales (Cmnd. 6348). The noble Lord said: My Lords, today's debate—which we continue tomorrow—is on a theme of immense constitutional and political importance. Devolution matters to everyone in the United Kingdom not just to the people of Scotland and Wales, because it concerns what will be, in some respects, the biggest structural change in the government of Britain for centuries. In short, the solutions which Parliament finally adopts will affect us all. We therefore have a responsibility to weigh the issues carefully and to find solutions which are not only right, but which will stand the test of time.

First, I should make clear what devolution is all about. It is about better democratic government—bringing power nearer the people. It is about involving the governed more closely in the affairs of government, in controlling the public business which affects so much of their daily lives. In other words, devolution aims to reverse the tendency—which has been apparent for many years—for central Government to become an enormous centralised machine, remote from the people it serves and inscrutable in its workings.

The reaction against such government is particularly keen in Scotland and Wales. It is not, I suggest, solely a matter of geographical distance. Scotland and Wales are historic nations, and their people are inevitably conscious that the central institutions of the United Kingdom Government are located in a different member country of the Union. It is this that makes them sometimes feel specially apart. Successive Governments have recognised the problem and have done much to help matters by decentralisation to the Scottish and Welsh Offices. This is a valuable technique and we propose to use it even more. But it remains a strictly limited concept. What it has moved to Edinburgh and Cardiff is essentially the work of Whitehall, not that of Westminster. Political control has remained here.

There is now a clear popular demand —most marked in Scotland, but evident also in Wales—to do more, and it is a demand that has existed for countless years. The question we face, in terms of democratic political reality, is not whether to make changes, but what changes to make. The Government have submitted to Parliament, in the White Paper of last November, a detailed scheme for the changes. I can assure your Lordships that it is not a set of guesses or political hunches jotted down on the back of an envelope. It fills out the commitments we undertook in 1974, and it represents an enormous amount of study and consideration over the past year.

But we do not put our detailed proposals forward as the last word. I am sure your Lordships will agree that wisdom does not rest solely with Her Majesty's Government. We want to hear what Parliament and the people think. We shall weigh it all carefully, and we shall not refuse to make changes where they fit sensibly into the basic concept, which we are convinced is right. We do not intend to legislate in haste or on the basis of rigid preconceptions, or without seeking the widest possible consensus.

There have been mixed reactions to the Government's White Paper. A number of suggestions have been made for changes to the detail of the scheme. But, more fundamentally, there have been those who have called into question the basic principles of our proposals. At the outset of our debate, I think that it would be right for me to set out once again the arguments in favour of devolution as a basis for constitutional change.

Some have said that we should make no change at all. It is not easy to grapple with the problem of creating a new framework for government. It is tempting to say that we do not need to do so. But this would be to ignore the very real pressures for change in Scotland and Wales, which I suggest we cannot simply brush to one side. All change has its dangers. But I believe that, in the situation which now confronts us, there are greater dangers in failing to make changes. These dangers were eloquently and cogently described in last week's debate in another place by the last Conservative Prime Minister.

In very broad terms, four options are displayed before us. They are separatism, federalism, the Conservative Party's outline scheme—to which I hesitate to give a name and our own proposals for devolution. The most straightforward solution, but the most damaging for us all, is separatism. But only a small minority in Scotland, and a smaller one still in Wales, want those countries to go their own way as separate states. I believe there is wide recognition of the strength which we have derived from our unity. The purpose of change must be to strengthen that unity by establishing more flexible arrangements for government.

Perhaps this is why those who are in reality advocating separatism indulge in semantics. For example, it was argued in another place recently that Scotland could have the status of Canada without breaking up the United Kingdom, since it would continue to owe the same allegiance to the same Crown. But, in plain words, this means separation for Scotland. Even in the short term, and on the narrowest and most selfish of economic calculations, it would be a very big gamble for Scotland to rely solely on high-cost oil to finance separation. For Wales, I believe separation would be a complete and utter disaster.

So much for separatism. I now turn to the second option—federalism. The Liberal Party have consistently urged a solution based on federalism. What is its distinctive feature? I suggest it is this. At present, we have a unitary State in which the Westminster Parliament representing the whole of the United Kingdom is sovereign throughout the land. In a federal system both the federal Government and the provinces would be sovereign within their own allotted fields.

Superficially, federalism has a certain appeal. There are plenty of examples of federal Governments in other countries. It may seem to fit a United Kingdom which is made up of four different component parts, and on paper I must admit that it looks a neater and tidier solution. But I believe that those who argue for federalism ignore the developments which have taken place in the real world. Modern political societies are more complex organisms than those which existed in the past. Neat dividing lines between sovereign jurisdictions within the same nation become more and more academic and more and more difficult to apply. Because a federal constitution can be changed only by special procedures, it is more rigid and less capable of adapting to necessary change.

When sovereignty is split within a nation. arbitration must rest with a judicial authority set apart from, and above, elected political authorities.

To most people in Britain, a federal system would appear strange, artificial and legalistic. We have to remember that federalism is a form of government which has been used to bring States together to form a single unit. In practice, with an existing federation it has been difficult to maintain the federal structure in the way in which its designers envisaged. Its more rigid framework has made for friction and confrontation under the pressure of change. Even in the United States the pure theory of federalism has proved increasingly hard to maintain under modern conditions. The difficulties would be even greater in the United Kingdom, a much smaller place with a long history of integration.

But the conclusive argument, I suggest, against federalism as the answer to our problems is the widely different size of the countries which make up the United Kingdom. England has 84 per cent. of its population and forms far too large a unit to be simply one State among others in a federal system. No federation could work satisfactorily with one part so overwhelmingly predominant in both size and industrial strength.

I fully recognise that the Liberal Party follow through the logic of federalism and propose to break up England into smaller pieces; but these pieces could hardly be regions with just devolved or decentralised powers. Under federalism they would need to be separate Governments, sovereign in defined fields, scattered across the country. I am sure that there are very few people who want to destroy the unity of England in this way for the sake of federal theory. As paragraph 539 of the Kilbrandon Majority Report says: In short, the United Kingdom is not an appropriate place for federalism and now is not an appropriate time".

My Lords, the Conservative Party agree with us in rejecting both separatism and federalism. They have attacked our proposals for Wales without putting forward any clear alternative proposals for real devolution. In Scotland their alternative policy is none too clear, either, but they appear to favour the establishment of a Scottish Assembly and a procedure for taking Scottish legislation first in the Assembly and then at Westminster. This scheme, too, may have superficial attractions as a framework for co-operation between the two Legislatures, but surely it is wholly unrealistic. Indeed, I would go further. It seems to me that the Conservative solution is bizarre. They appear to be ready to create a new political authority. They then try to remove any risk which might be involved by removing the sharing of power. They say this would avoid conflict. In one sense it would. The risk of conflict is inherent in the sharing of power.

In any system where power is genuinely shared between democratic political authorities—and the new Assembly will be such an authority—there has to be a dividing line. There is bound to be contact and interaction along that line. Whether its style is that of cooperation or of conflict is something that no Statute can determine, but we must recognise that conflict is possible if that is what either of the partners in the sharing is determined to create. It is therefore strange that the Conservatives of another place should put forward their scheme while at the same time attacking our proposal for reserve powers, which I shall speak about later, under devolution. I believe that their scheme will create a different, and potentially more dangerous, source of conflict because it would mean that the Scottish Assembly could do nothing without the positive approval of the Westminster Parliament. In my view, their Assembly would be an impotent Assembly. It would be solely a talking shop.

Even if Scots of weight and quality joined this talking shop—and I really cannot see why they should—I can hardly think of anything more likely to produce friction. The Assembly would have no responsibility at all. It could not spend money. It could not sack the Executive. It could not take decisions. It would have no practical burdens to absorb its energies and profit from its talents. It could neither carry through any legislation nor stop any that it disliked.

Conservative comments have made much play with the difficulties which could arise under the Government's scheme when one Party was in power in Edinburgh and another at Westminster; but let them consider how matters would then stand under their own scheme. The Scottish Assembly would have the power, in my view, simply to bellyache—and we may be sure that they would use it, not simply to criticise what the Government and Parliament did but to demand genuine power for themselves. My Lords, they would have nothing else to do. No better recipe for built-in conflict can be imagined. I therefore find it extraordinary that this scheme should be presented as a way of avoiding conflict. The hard truth is that even if the Conservative concept ever matched the political realities of Scotland, it certainly does not do so now. The Scottish people plainly expect more than this. I just do not believe, therefore, that the Conservative Party's proposals stand up to any detailed examination.

And so we come to the Government's own scheme of devolution. What does devolution mean? In constitutional terms, it must mean that practical powers are transferred to separate Assemblies in Scotland and Wales without—and I stress this—taking away sovereignty from the Westminster Parliament. The transfer is a delegation, not a surrender. We believe that this provides the best and surest safeguard of unity and that within it we can secure a genuine transfer of decision-taking to local institutions in Scotland and Wales.

The Government intend that the transfer should operate over a very wide range of matters. It will cover the great bulk of social and environmental affairs in Scotland and Wales. In brief, the new Administrations will be responsible for health matters; social work; schools and most other aspects of education; the arts; physical planning and the environment; general oversight of local government; tourism; and much of transport policy, including roads. The Scottish Administration will also have wide responsibilities for law.

In these matters, the new Assemblies will not simply come in between Parliament and the Government on the one hand and local authorities and the people on the other. They will, for practical purposes, actually take over the role of Parliament and Government, with the one exception that, for Wales only, Parliament will continue to undertake all primary legislation.

I can scarcely emphasise this basic theme too strongly. I should like to nail the allegation that devolution will contribute to over-government by adding a further tier to the levels of government which already exist in Britain. This is not the case. What will happen, in essence, is that in the devolved areas Edinburgh and Cardiff will take over what is now done by Westminster and Whitehall, or their decentralised departments. And all these latter will step aside.

If we wanted to interfere constantly, we would not be proposing devolution at all. The whole point is wide freedom to do things differently. Some critics complain that the freedom will be scanty, because the new Administrations will begin with existing commitments and existing patterns of law. I do not see that they could be expected to start with anything less, any more than a fresh Party in Government does. But they can change. They can, if they wish, and are prepared to answer for it to their electors, change very radically, particularly in Scotland where full law-making powers will be devolved. In my view anyone who fears this is fearing democracy. The Government are not prepared to hedge devolution about with large-scale entrenchment of existing methods and systems in the devolved fields.

The whole point of devolution, therefore, is for decisions in Scotland and in Wales to be taken locally by local institutions. Perhaps I might say a brief word here about the Government's proposals on reserve powers. It would be unfortunate if discussion on these proposals were to obscure the magnitude of the shift to local control which we are proposing in the White Paper.

My noble and learned friend the Lord Chancellor will be dealing in greater detail tomorrow with these reserve powers and with other legal aspects of the framework of our proposals. But I must emphasise one general point as part of this broader survey of the options before us. Unless we choose to go down the road of separatism or that of federalism, then sovereignty will remain with the Westminster Parliament. It is basic to the concept of devolution that this should be the position. Those who say that there should be no reserve powers for Westminster are not arguing for a different form of devolution. They are arguing for federalism and beyond. We could have proposed no powers of intervention short of fresh Westminster legislation. Instead, we have proposed more flexible arrangements to safeguard the United Kingdom interests, which will still require the backing of the Westminster Parliament.

The main fact about devolution is the transfer of practical power and responsibility to the new democratic authorities. As I have said, there would be no point in going down this road if we had any intention of engaging in constant interference in the work of these new authorities. The existence of reserve powers simply reflects the fact that, under devolution, the United Kingdom will remain a unitary sovereign State. Therefore, we at the centre cannot divest ourselves of ultimate concern for the wellbeing of its citizens or our power to intervene in matters where the interests of the United Kingdom as a whole are involved. I do not believe that these principles need be inconsistent with practical effective devolution of decision-taking in wide areas of Government activity.

Apart from the question of reserve powers, there has been a good deal of discussion about the limitation on the freedom of action of the new authorities involved in our proposals in the economic field. My noble friend the Minister of State at the Scottish Office will be developing these matters in more detail later today. But perhaps I could say a general word by way of scene-setting. We are committed to preserving the economic unity of the country. Britain has been an economic unit for approaching three centuries. We have all benefited from this, not least Scotland and Wales. But we cannot have the benefits of unity without the means of unity.

Economic unity means that the wealth of the whole nation must be used to the benefit of all parts of the nation. Only the central Government can share the nation's resources fairly among all parts of the country and between devolved and non-devolved services. Only the central Government can pursue those policies which are designed to promote regional economic balance. Only the central Government can deal with problems of industrial balance within the country as a whole. If resources are to be shared centrally, then levels of taxation must be adjusted centrally. We believe that the block grant system for financing the new Assemblies is preferable to fragmenting the country's tax system. Our approach is consistent with the allocation of fair shares, on the basis of need, with contributions to a common pool of resources.

Economic unity also means that we must not erect new internal barriers to free trade within the United Kingdom, particularly at a time when we have moved into the wider international Common Market which the European Community provides. This is why the Government propose to retain central control over the regulation of industrial and commercial standards which form the framework of our own internal common market. The requirements of economic unity place a limit on the devolution of powers in the industrial and economic field.

I think it would be wrong to devolve responsibility which would need to be subject to regular intervention from the centre; or which had been hedged about with so many restrictions that the new Administrations had no freedom to manoeuvre on their own part. This would be inconsistent with the purpose of devolution. But this does not mean that the new Scottish and Welsh Assemblies will not have important powers in economic terms. They will have considerable economic influence through their control of public expenditure priorities and their responsibility for the physical and social environment in their countries. They will be sharing in the direction of the work of the new Development Agencies.

But we have proposed, and I believe rightly, the retention at Westminster of those powers which are necessary to preserve economic unity and a common framework of regional and industrial policy. I do not believe that any part of the country would gain if the component parts of the United Kingdom were free to go down the road of" beggar my neighbour" industrial and commercial policies.

I now turn, in view of my particular responsibilities for the Civil Service, to speak of its role within the new scheme. As the White Paper explains, the Government think it best to keep a unified Civil Service. In the short term nothing else is possible: separate Services could not be set up quickly. But we think this is right for the long term also. This view is shared by the civil servants themselves, as has been made very clear to me during my full discussions with some of the Staff Sides concerned.

Of course, my Lords, we shall be ready to listen to the views of the Administrations themselves, when they are in operation. It is obviously important to good government that the new devolved Administrations, who will be acting for the Crown just as United Kingdom Ministers do, should feel confident of the loyalty of the officials who serve them. But I very much hope they will recognise that they have nothing to fear from a unified Civil Service. On the contrary, we believe, as the White Paper says, that it will have very definite advantages. For example, it should mean better quality staff, better co-operation and less duplication.

Let me make it clear—since some misunderstandings seem to persist—that no civil servant is going to be asked to serve two masters at once. There will be a clear division drawn between the Departments of the Secretaries of State and the Departments of the new devolved Administrations. Naturally, I hope that there will be much contact and co-operation across that division. But the lines of responsibility will not cross it. Every official will know which political master he serves.

Civil servants are fully used to giving complete allegiance to their responsible superior, for example when Parties of Government change. The same happens when they are posted to another Department, or even to some body outside Government or to an international organisation. Those of your Lordships who have experience of government will, I am sure, confirm this.

Fears that members of a unified Civil Service will always be looking over their shoulders for the bidding of some shadowy mandarin in Whitehall are utterly unreal. Officials do not win the respect of their colleagues by doing this, nor by hasty surrender when they meet opposition. They win respect through their full understanding of the business of their Departments and the effectiveness with which they promote it. I am confident, therefore, that a unified Civil Service will serve the new Administrations just as well and just as wholeheartedly as it has served diverse Governments and Departments in the past.

Finally, my Lords, I should like to say a few words about the position of England and Northern Ireland since the public debate on devolution has so far focussed mainly on Scotland and Wales. This is a reasonable reflection of the fact that they raise separate and clearly-identifiable issues. In addition, public opinion has crystallised far more clearly there than in England.

A Noble Lord

You can say that again!

Lord SHEPHERD

My Lords, the Government have had in mind, at every stage of their work on Scotland and Wales, their equal responsibility for England, and for Northern Ireland as well; so the schemes in the White Paper are most carefully framed to recognise divergence, but not to give unfair advantage. It is precisely from this consideration that many of the limits on Scottish and Welsh devolution inevitably spring. But we are at the same time looking at the positive needs of the other members of the United Kingdom. For reasons which I wish were happier ones, the Northern Ireland situation is constantly in our minds.

As regards England, we hope soon to publish a discussion document which will help to focus thinking on what changes, if any, might be sought there. But we think it neither necessary nor right that action on Scotland and Wales should wait upon decisions about England. Our proposals in the White Paper are designed to stand on their own merits. They do not stand in the way of changes to meet the very different circumstances of England or Northern Ireland.

My Lords, my conclusion is this: real change—not just cosmetic tinkering—is essential. Some of the courtiers of King Canute may want to holdback the tide. But the demands for change are not a passing fancy. They spring from a deep and growing dissatisfaction with the workings of what is seen as a remote and over-centralised Government machine. The right changes will strengthen the Union, not weaken it. The refusal of change will gravely imperil, not just individual political Parties, but perhaps the Union itself.

I hope that your Lordships will give attention to the specific and detailed proposals in the White Paper, and offer suggestions where it is thought that they might be improved. In my view, the time is past when debate on whether to have devolution is fruitful. We need to decide precisely what scheme will best serve the United Kingdom as a whole. We shall listen to the debate; we shall study what is said, and we shall bear all these factors in mind as we prepare the legislation. I beg to move.

Moved, That this House take note of the White Paper Our Changing Democracy: Devolution to Scotland and Wales (Cmnd. 6348).— [Lord Shepherd.]

3.34 p.m.

Lord HAILSHAM of SAINT MARYLEBONE

My Lords, I am sure that the House will be grateful to the noble Lord the Leader of the House for his temperate and thoughtful speech. I think no one will complain—least of all, no one who has experience of office—that the noble Lord clearly stuck fairly closely to an established text. If I do not do the same to quite the same extent, it is because I am not in office and because I wish to direct some of my remarks as I go along to some of the things the noble Lord has just said because, after all, this is a debate, not a recitation.

My Lords, I was flattered and very grateful to my noble friends for asking me, a man of known heterodoxy in these matters, to speak first from these Benches on behalf of the Opposition Party. But I do not want in any way to sail under false colours. On two very important matters to which I shall come in due course, I am, and I shall say that I am, speaking on behalf of all Conservatives, but I should not like to saddle my noble friends with unanimous support of other things I shall say. I do not know that anybody can speak in this matter on behalf of a united Party. I am sure I cannot, except in the two matters which I am about to discuss. I do not believe the Government can. I am quite sure the Scottish Nationalists cannot—if they were only explicit about their real intentions—and I do not know whether the Liberals can or cannot speak for an entirely united Party. But it is no shame on any of us, especially in this House and especially in the course of a "take note" debate, if we choose, instead of being trammelled with all the shackles of collective responsibility, to exercise for once our functions as individual counsellors of the Crown; and that is what I propose to do.

I was particularly grateful to the noble Lord, Lord Shepherd, for his assurance that the Government would take account of all that was said in this debate. I confess I would have liked him to go a little further, because I understood that they were not prepared to modify what they call the basic concepts of their scheme, but that depends, of course, on what concepts of their scheme are to be regarded as basic. I hope we may take from the Government a fairly liberal interpretation of the degree to which they are prepared to modify their scheme in the light of criticism.

There is one matter upon which all those on our side of the House are absolutely united; that is, that we wish to preserve the union of the United Kingdom in its entire integrity. Everything that we say—everything that I say—must be seen in the light of that overriding principle. From the White Paper and from the speech of the noble Lord this afternoon, I am happy to note that the Government share our view in the matter. I do not in the least doubt their sincerity, although, as I shall be saying, I think there are disadvantages in their present proposals which might fail to achieve that objective;but on the objective at least there can be no dispute at all between the Conservative and Labour Parties, and I hope none whatever between the Conservative, Labour and Liberal Parties.

I come now to slightly more controversial material. I listened in the Peers' Gallery in another place to the Ulster debate, and the devolution debate which followed it I read with some diligence in the Commons Hansard. In the course of those two debates, speaker after speaker, each from his own point of view, was saying something like this: "Of course, Ulster is absolutely unique; the problems of Ulster are unparalleled anywhere in the world. Of course, Scotland is absolutely unique; its problems are not to be paralleled anywhere else in the world. Wales is quite different, and England is different, too." All this is true. There is no greater defender of diversity in unity than I am myself, but I have to say seriously to my fellow-countrymen that they cannot keep the Union intact on those terms alone.

We have to live together in a single country, and I must say I agreed with Mr. Heath that the terms on which we live together in different parts of the United Kingdom, although not necessarily identical in every respect, must in the end be roughly comparable. I do not think anything else is possible. If we think it is possible I think we deceive ourselves, and I think we really deceive ourselves also if we think that the differences between Ulster, Scotland, Wales, Cornwall and East Anglia are really any greater, great though they may be, than those between New Jersey, Texas, Wisconsin, Alaska and Hawaii, or even, to name another country which I know fairly well, Ticino, Basel Stadt, Graubunden, and Canton Vaud in Switzerland. There is nothing in the nature of the problems which beset us so unique that we cannot profit by the political thinking of other countries.

My Lords, here I am echoing something that the noble Lord, Lord Shepherd, has just reminded us of: the number of options open to us is limited, more limited than we are apt to realise, and we simply deceive ourselves again if we think that we can enjoy the best of more than one of them. No doubt there are infinite variations within the broad options, but in the end the ball which we are playing must go into one of a limited number of pockets. And, unlike the noble Lord, Lord Shepherd, I shall limit the options to three, and not categorise them in exactly the same way as he has done. The three options that I see are as follows. First, I agree with him, is separation. We can go our separate ways, we hope in friendship, we hope without bitterness, like Norway and Denmark at the beginning of the century, no doubt; like the Benelux countries, in the EEC, also, as someone suggested, within the Commonwealth. None the less we have to face that that is separation if we do it. I shall call it, for want of a better name, the Scandinavian solution, because of the analogy of Norway and Denmark. It is not consistent with Conservative policy, because it means the breakup of the United Kingdom, and it is not consistent with the Government's policy because equally they are committed to the integrity of the United Kingdom.

But, further, I should like, in my own words but not differing in spirit from the noble Lord, Lord Shepherd, to say, with what emphasis I may, that I believe that solution to be a recipé for disaster and furthermore to be technically impracticable. I believe it is a recipé for disaster both on foreign policy and on economic grounds. As Norway, Denmark, Holland, Belgium and Luxembourg all discovered to their cost in the last war, the independence of small countries is an illusion dependent upon an equipoise between great Powers. Those countries I have named lost their independence in the last war. They were rescued from the loss of their independence because others fought their battle for them, and the most important of those others was the United Kingdom of Great Britain and Northern Ireland. If Britain had split before the war, there would have been no one to come to the rescue of Norway, Denmark, Luxembourg, Belgium or Holland, or of the component parts of the United Kingdom, either, and if we were to split now there would be no one to come to our rescue, if, as might happen, we lost the independence and liberty which are a nation's greatest pride.

Even if I were wrong about this, and even within the Common Market were we to go our separate ways, other nations would play one of us off against the other in such a manner as to leave each of us weak and each of us relatively impoverished. "United we stand, divided we fall" is something that ought to be written on the heart of every inhabitant on these Islands.

I think also with the noble Lord, Lord Shepherd, that the recipe is impracticable. After more than250 years of union we have grown together. We have inter-married. We have fought and died together in support of our common country. Our communications, our industries, our economies, even our higher education, have become so interdependent that I do not believe that you could divide the one surgically from the other. The technical business of unscrambling the social, economic and educational eggs is, I believe, technically impracticable on any terms which would be acceptable to any of us.

The second option is now, therefore, the one which I examine, and again I agree with the view expressed by the noble Lord, Lord Shepherd, that the second option is a unitary State. We have a unitary State now, and even in that form I believe a unitary State to be infinitely preferable to separation. But, my Lords, I differ from the noble Lord, Lord Shepherd, in thinking that this second option is the choice, although in a different form, which the White Paper has really taken. They have retained the unitary State, but they have retained it, I believe, in a form in which it could not possibly succeed or conceivably survive indefinitely. To have a devolved Assembly complete in the case of Scotland, though not of Wales, with legislative powers, and complete with an Executive which could be overridden legally at any point by the Central Government, by a policy veto, whether operating through the Secretary of State or through their machine-made majority in the House of Commons, would, I believe, provide a constant platform for separatists and malcontents without satisfying any of the legitimate aspirations of moderate nationalists.

My Lords, the noble Lord, Lord Shepherd, teased us for having fallen into the same error. I think we have. I may as well be honest about it. The noble Lord may be surprised, but I believe the same to be true of the earlier proposals—I say this to him with the very greatest of affection and respect—of my noble friend Lord Home, with, I think, the additional disadvantage that too much water has flowed under the bridge since they were first put forward for them to come now within the field of practical politics. And, indeed, a great deal more water will have flowed under the bridge, though perhaps not so much as the Government think, before a Conservative Government have to implement his proposals.

Far better than solutions of this kind, I believe, would be a naked refusal to change the status quo. But, for reasons which I am about to give, I agree with the noble Lord, Lord Shepherd, that a naked refusal to change the status quo, attractive as it might be to those of us who do not mind the status quo, is no longer practical politics. But I say, for all that, before I leave the unitary State, that I believe that in the form proposed the Government's scheme will not work, despite the impressive majorities for it obtained by Mr. Mellish in another place. It will not work, not because of want of popular support, but simply because, to use a phrase, it has got square wheels.

So I turn to the third option. I call the option true devolution. This means a separation of powers. One can call it, if one likes, power sharing, but that has been pre-empted as another name for a Coalition Government in connection with Northern Ireland. So long as one understands what one means by power sharing I do not in the least mind it: so long as we understand that, like a sirloin of roast beef, power can be shared only if you put different parts of the sirloin on different plates. In other words, there must be, to end my parable, a separation of powers with, or without, the retention of final legislative power at Westminster between the central and the regional Governments.

It would, of course, be a federal solution (on which the noble Lord poured I think excessive scorn) if Westminster were to abandon its final sovereignty, but it would not be necessarily federal to the extent that it does not. In passing, may I say to the noble Lord, Lord Shepherd, and to the noble and learned Lord who is ultimately to reply, that I do not accept that in a federation the devolved Assemblies are sovereign. This is an error, and it has been shown quite clearly by Dicey in the Law of the Constitution that this is not so in the United States nor is it so, I think, in any other true federation. But whether separated powers defined by law constitute a federation or not will depend upon the extent to which Westminster retains in some form the power for over-riding legislation and using it. For 50 years in practice this is what happened at Stormont, but this was due to a self-denying ordinance and not to a legal fact. I would not recommend a self-denying ordinance now either for Ulster or for Scotland.

If there is to be true devolution in Scotland, Ulster or Wales, or, I would add, all three, the powers of the Assembly must be defined by law, and must be operated and policed through the courts of law, whether or not Parliament retains its ultimate sovereignty. Furthermore, a reversal, or amendment, must follow some form of prescribed ritual which the courts can recognise. In my view a new Constitution of this kind ought to be sanctified by a referendum at some stage, although I do not want to elaborate on that this afternoon. The point I am making is that in order to give round wheels to devolution it is necessary to define powers by law and to provide that the courts shall decide questions of vires.

I want to take the argument a stage further because I believe that the demand —based, as the noble Lord, Lord Shepherd, has truly said, upon long and proud separate national traditions—for devolution in Scotland and Wales is only one aspect of a malaise affecting England no less than Scotland and Wales. It takes the form of nationalism in Scotland and Wales because of the tradition to which I have referred, and for which I have the greatest of respect. But they are not the only portions of the United Kingdom under strain, even if we forget—and who can forget?—Northern Ireland.

When Dicey wrote his famous work on the Law of the Constitution rather more than 50 years ago he picked out two outstanding principles of British constitutional law as underpinning the whole edifice. He pointed out that other countries there were who did not enjoy both of these principles. There were many countries, alas! with a sovereign Legislature but no rule of law. His two principles were the sovereignty of Parliament and the rule of law. There were also countries to which he referred with a rule of law but no sovereign Legislature, and he instanced particularly the United States, where sovereignty was shared under the Constitution between separate organs of government with a prescribed ritual and a qualifying majority for altering the Constitution. In the United States it is the rule of law which is supreme and not the temporary majority in Congress, or the President.

Since Dicey wrote, as the Lord Privy Seal rightly pointed out, the Constitution has remained the same, but its operation has come to be felt oppressive in a variety of different ways. To one of these the Lord Privy Seal drew attention —the proliferation and expansion of Government activity. Dicey was talking of a United Kingdom in which the total Budget was, I suppose, £200 million, or thereabouts. Even between the wars, when I was a young man, the total Budget was £800 million, or thereabouts. There were no great nationalised industries controlling economic activities in the periphery of the Island but centralised in Whitehall or Grosvenor Gardens. The Civil Service was minute. Parliament had two effective Houses. The powers of the Executive were largely limited to the ancient Prerogatives of the Crown. But since then the sovereignty of Parliament has come to mean more and more the rule of the House of Commons, and the House of Commons has come to mean more and more the machine-made majority deployed by the Party Whips, by the Executive, and backed by the Civil Service preparing the immensely effective Civil Service brief. The Opposition is no longer composed of persons of independent means, able to deploy resources of their own to defeat the arguments of Government backed by the civil servant, but is more and more driven to occupy its time in outside activities to keep pace with inflation.

All this is coupled, as the Liberals will be reminding us shortly, with the present voting system, which enables a small minority to command for a time all these immense powers. All of this is coupled with the power of Dissolution in the hands of the Prime Minister of the day. I wonder whether any of us realises that since 1945, aided by the opinion polls which, although not infallible, provide one with a rough guide, only three sitting Governments have been displaced by the popular vote, and then each time I think by less than 10 seats, although during the pendency of that Parliament the opinion polls indicated a very different balance of opinion: in 1951, 1964—there are four occasions—June 1970 and February 1974. I was wrong about the number of seats in June 1970—unfair to my own Party. At any rate, the effect of this of course is to mean an immensely greater power in the Executive, with at any rate a qualified chance of self-perpetuation without legislation. These things make a very different picture to that which was known by Dicey.

I speak as a convinced devolutionist in the sense that I have explained, a devolutionist for Scotland and Wales. But I do not believe that devolution is the answer. I think we have to take a definite move along the path which we have shown to every Member of the Commonwealth to which we have given independence, and along the path already taken by every other nation in the Free World. In short, we need to develop a written Constitution, by which I mean a Constitution which is controlled by law and definition and in which the temporary majority in the Lower House is not all-powerful. We need to decentralise, not merely by regional Assemblies but by breaking up some of the great centres of power I have mentioned. If dictatorship is the concentration of power, freedom consists in its diffusion throughout the community, otherwise we are in danger of breaking up this splendid alliance which has grown up over the last 300 or 400 years into a welter of conflicting interests, sectional and regional.

To my Scottish and Welsh friends I say: I do not deny the demand from your parts of the country for regional devolution, but they cannot be seen wholly in isolation from the situation in England. It may easily prove intolerable. If it be intolerable, that a temporary majority of English members should say what, for instance, the structure of education should be in Scotland, it may be intolerable that a temporary majority composed of Scottish and Northern Irish members should say what the educational framework should be in England. But it is no good looking at these things piecemeal and saying they are insoluble. We have the problem of the voting system, and it is no good the Liberals saying," We want to alter the voting system,"without looking at it in conjunction with the other problems. We have the problem of local Government taxation. One Commission after another has said that rates are a regressive and intolerable tax, but largely because our units of local government are too small to have any other. We have perhaps a not altogether effective Second Chamber as a brake on the whims of the Executive and their machine-made majority with absolute powers in another place. But we cannot look at that entirely in isolation from the needs of the regions and the demand for a Bill of Rights.

Again, if we are going to give devolution, then we have a written Constitution; that is what we shall have. Can we ignore the demand for entrenched powers lest perhaps either the regional Assemblies or the Central Government overstep the mark either by reason of misusing their powers or by passing outside the bounds of the vires of the Assemblies concerned? None of this means that we must part. No doubt before the various dates at which our Union was established we were an admirable people. We have our proud memories of Bannockburn and of Flodden, of Agincourt but also of Calais, written on Queen Mary's House—

Several Noble Lords

House?

Lord HAILSHAM of SAINT MARYLEBONE

I should have said Queen Mary's heart, my Lords; it was a Freudian slip. There is Owen Glendower and Cuchullain and the Battle of the Boyne, but we played no significant part in the destinies of mankind before our Union was established. Since it has been established, we have become one of the most successful political communities in the world has ever seen; we have spread our laws, our languages, our customs and even our names and religion over a great part of the globe. Five times since the Armada we have preserved the freedom of Europe. We virtually invented, and certainly popularised, representative government. We pioneered the Industrial Revolution and modern science; and we devised or popularised almost every form of sport and recreation, with the possible exception of polo, chess and sex, and those of us who are over 40 enjoyed the comradeship of arms to defend our liberty. Is all this to go for nothing now?

When the Union with Scotland was established, a Scottish Lord is alleged to have said that its passing marked the end of a long chapter. I will not attempt to repeat his actual words or the pronunciation in which they were spoken, but it did not mean the end of a long chapter. It meant the beginning of the most glorious chapter in the history of these Islands and of every part of them. Every man and woman worthy of the name has a country and I am not ashamed to say that my country is Britain; my country is the United Kingdom of Great Britain and Northern Ireland and to me no inhabitant of that country will ever be other than a fellow countryman. I therefore hope that we shall maintain our integrity but go perhaps a little differently about the particular problem under discussion than the way pointed out by the Government White Paper.

4.6 p.m.

Lord MACKIE of BENSHIE

My Lords, I am delighted by the attitude of noble Lords from the Government and from the Conservative Party. I would not be so disrespectful as to refer to such distinguished noble Lords as "Johnnies Come Lately", but I must remark on this attitude of understanding, though I was particularly glad to hear the noble Lord. Lord Shepherd, say that he would listen to the arguments and that the basic premises on which legislation might be framed might be altered by the arguments put forward during the period of discussion. I was particularly glad to hear the noble and learned Lord, Lord Hail-sham of Saint Marylebone, differ from his Party and be so completely understanding about the needs of Scotland; and I should like to speak about Scotland.

I have noticed in the other place and in this House, and in the country generally, that there is a lack of understanding among the English of the situation in Scotland, and before I proceed to discuss the White Paper I wish to explain, as a Scot, some of the attitudes which puzzle a great many of my English friends. I am as pure a Scot as it is possible to be. The peasants of Aberdeenshire do not move about much and for the last 300 years I am unable to discover any ancestors—if their wives were true and proper—who were not farmers in Aberdeenshire, so noble Lords can say that any English blood in me is rather thin. I think I do understand, although I have been much among the English, exactly what my fellow countrymen feel about Great Britain. We are, after all, 5 million people in a great country of 55 million, and I regret to say—I say it because it is true—that we have a "chip" on our shoulder occasionally about it. We have a long history which every Scottish child has been taught—of noble conflict, of Bannockburn victories and of Flodden's defeat, of noble strife against a larger neighbour. And we have the Union of the Parliaments of 1707, and, since then, as the noble and learned Lord, Lord Hailsham said, a noble history of development of military prowess and of the defence of freedom of which I am very conscious.

In the period from 1707, Scotland has gone through a number of phases and the main one, to begin with, was of course development. Scotland benefited greatly from the Union and the opening of trade with the English possessions overseas and, of course, in the Industrial Revolution Scotland's deposits of coal and iron brought great prosperity and development to the country. Furthermore, medicine, agriculture and intellectual prowess in economics and other fields were a great feature of Scotland in the 18th century, but this was accompanied by the destruction of the Highland tribal or clan system, by a great deal of emigration and by industrial pollution which was perhaps unequalled in Europe in its results in the slums of Scotland today. So the benefits were not all one-sided. That is very much in the minds of the people of Scotland today.

When the Empire was a real Empire and when India was open, it had a tremendous economic effect on Scotland. Many Scots went to Malaya to plant rubber, they went to India to plant tea and they went from Dundee to Calcutta to make jute. They went into the Indian Civil Service and medical service and into the Armed Forces. The Empire was a real economic factor in the life of Scotland. That has changed. It has gone. What we have more recently seen in Scotland is the pulling of all power towards London—social, for the court is here; political and economic, for the City of London has gradually drawn a great deal of enterprise from Scotland in the shape of people. That has burned deep into the people of Scotland. It is not something nasty; it is not a question of hatred, but there is a bit of a "chip" and what I have described are facts. It is a matter of sorrow to me that, when I was in Crete on holiday, my wife was foolish enough to say to a lady in the South of Crete that she was Scottish, whereupon the lady said, "Ah! Rangers, Barcelona!" It is a terrible thing to me that this is the reputation which Scotland, which once had Edinburgh, the Athens of the North, now enjoys among the people of Ancient Greece. Really, that is a funny story but it tells us something. We need a centre of power in Scotland in order to revitalise the general feeling in the country.

I have said this often. I fought—sometimes successfully—five Elections to get into the other place and during each and every one I had at the head of my election address a call for a Parliament for Scotland. I have detailed the arguments which I have given. I have believed this throughout the quarter of a century which I have spent in politics and I believe it firmly now. We in the Liberal Party in Scotland have thought and talked about little else, though I must admit that the English, even in the Liberal Party, have not thought as much about it and that we may have some disagreement on the matter; but I can assure the noble and learned Lord, Lord Hailsham, that we are more united about this issue than are the other Parties. In Scotland, we have studied the problem a great deal. We believe that a federal system is the right one. However, some time ago and as a practical measure, the Member for Roxburgh, Selkirk and Peebles, Mr. David Steel, proposed that we should accept devolution as a step towards federalism. As a practical point, we accepted it and we support the idea and the motives behind the Government White Paper, though we would wish to see it greatly altered.

I must admit that we Liberals have not been successful inputting over to the people our logical, reasonable policy of a United Kingdom with a devolved centre of power in Scotland—a Scottish Parliament. I must also admit that the conversion of the Front Benches of both major Parties has been due to the success of the SNP, of whose methods I dis- approve. I do not like their appeal to pure emotion and to greed. I find appalling the slogan, "Better a rich Scot than a poor Briton", and one which is on a level with a slogan employed in Smeth-wick at a famous election some time ago. Nevertheless, I must say that the SNP are backed by a large proportion of the people of Scotland, who do not necessarily back the SNP solution but who believe that the Party is putting forward an effective means of obtaining the devolution which most people in Scotland want. I believe that it is support for an idea and not particularly for the Party, though I cannot but say that there are many hardworking and excellent people in that Party.

I believe that the White Paper is a great advance. I feel that it is a tremendous step forward for a centralising Socialist Party and I am glad that they are at least facing realities. However, I must say that I believe that the reluctance, the compulsion and the force show through in the White Paper. I do not believe that it goes far enough to harness the imagination of the Scots or the energy which would lie behind it if that imagination were harnessed. For example, the administration of £2,000 million is an enormous job; the Government are quite right. However, the Government also know perfectly well that such is the inertia generated by spending and by affairs that to shift it by more than 1 per cent. or possibly, with a tremendous effort, 2 per cent. is extremely difficult.

I know that many people want to speak this afternoon and, though I could talk for hours about this matter. I want to get on. I should like to suggest that the technical example of Stormont is a good one. Clearly, Northern Ireland cannot be taken as an example but, technically, the Stormont set-up was a rather good one in many ways. I believe that the Government can go quite a long way in studying this. For example, they should look first of all at the industrial set-up there. I know that Northern Ireland was spending money from central Government and I have had it put to me that it had a lot of extra money, but the point is that it spent it very effectively. Simply because of size and because of the involvement of the people, the Northern Ireland Department of Industry was very efficient. It met people. Industrialists who were inquiring about sites and about help were answered immediately, were met by a Minister and were shown sites. The whole matter was expedited, and Northern Ireland was very much more successful in industry than any other part of the United Kingdom which was suffering similar evils of unemployment. The technical efficiency was, therefore, reasonably high.

We need to do more in Scotland and I therefore feel it to be essential that industrial development should come under the Assembly. An interesting figure produced by two Labour academics in Glasgow and published in a newspaper this morning shows that 60 per cent. of the people employed in manufacturing industry in Scotland are employed by firms whose headquarters are outside Scotland—that is, in London, America or elsewhere. That is a disgraceful figure and I believe that one of the major tasks of the Scottish Assembly and its Department of Trade must be to reverse that figure and to encourage native enterprise. The same paper—the Financial Times —contained a sneer at the entrepreneurial blossoming which it said the SNP expected under independence. I thought this rather a cheap sneer because I expect that many Scots would comeback to a Scotland which they felt had been revitalised and would bring their experience with them.

I know of a modern nuclear enterprise which has been highly successful. It was started by two able scientists who had been in the States and had become infected with the spirit of private enterprise there and who have now done a great deal of good to the native enterprise of the centre of Scotland. The headquarters of the business is there and will not be closed down. My noble friend Lord Thurso and I are involved in a small enterprise in the far North of Scotland and, due to a determination to do so, we have produced a successful enterprise there. I and many other Scotsmen would do this if something was set up under the Assembly, if the Assembly was using its imagination and if it had powers not to vary the incentives enormously but to make them original and to apply them to people in a personal way.

Noble Lords must understand that the Scots are not fools. They understand that, if there are 5 million people next to 50 million people in a highly industrialised nation, it is not possible to go one's own way and enter into competition with them in attracting outside industry. One must co-operate. The Government should recognise this and put the whole of the SDA and the Highland and Islands Development Board under the Assembly and stand back happily to see what happens. I say that because we would cooperate very happily in it. I do not see why the Government cannot come to an arrangement to allocate a proportion of the oil revenue for extra work in Scotland. That would be logical. I cannot see any practical reason for not doing it.

I turn to another very important industry; that is, agriculture. The Government must be out of their tiny minds in removing it from control of the Assembly. Scotland has a tremendous reputation in agriculture. With 400 miles on average further North than England, with a lower temperature and everything else, we in Scotland grow larger amounts of grain, potatoes and practically every other crop which one can name, apart from maize. We do this because of the long tradition of good farming and because of the great deal of research which has gone on in Scotland. Again, the Irish example is one which should be followed. Long before the Ministry of Agriculture in Britain realised the value of silage, the Northern Ireland Ministry of Agriculture produced a scheme in its climate, which it knew was suited to silage and not to hay, to subsidise the making of silage pits. Had it been run from Whitehall, this would never have been done. This is only a small example, but it illustrates the type of thing which goes on, and did go on, where the power existed.

I know that it is not at all necessary for agriculture to be part of the London Government's remit. It must lie in Scotland, because something which Scotland has is a tremendous area of undeveloped land—undeveloped from the point of view of both agriculture and forestry. It has been clearly demonstrated in Scotland that, if the two are tied together, one gets a tremendous bonus. One gets shelter, more grass, more stock and the trees as well. On the island of Lewis there is an excellent scheme produced by the North of Scotland College of Agriculture in which peat bogs were worked out into pasture. This was dependent on a high subsidy for lime off the seashore. It is quite astonishing to see the islands of green in this sea of desolation. This could be applied over the whole of the Highlands and many other places.

Something of this type can fire the imagination of people who know about it and the Assembly would be quite happy, if the practice was shown to it, to allocate special funds to it. There is no case in a hungry world for not having the maximum development of agriculture in Scotland, and I believe that only an Assembly could do this properly.

Because of lack of time I have taken only two examples, but they are examples where the Government must think again. I believe in the unity of the United Kingdom as firmly as either of the two noble Lords who have spoken from the Front Benches. I, too, am over 40 and I have fought alongside—not with—the English in wars of a noble character, and I should be desperately sorry if we were to break up. There is a family simile here. My father farmed a number of farms. He had a great idea, when younger, that he would bring in all his sons and have an enormous combine, with all the advantages of scale, and he would quickly manage to gobble up as much land as he could with the assistance of his family. However, when he started he found that his family were not the sort who could get on all that well when they were closely knit; so he quickly introduced a form of federalism, put us all on to our own farms, and the family stayed united ever after. That is a very solid example for us to follow.

The Scottish Secretary, Mr. Ross, is a man for whom I have the greatest admiration; I mean this most sincerely. If I were addicted to tiger shooting, which I understand is a dangerous occupation, there is no one that I should rather have at my back or my side than Willie Ross. He is a really staunch man. I should rather have him than perhaps many Members of my own Party, and certainly of the others, in that type of occupation. But his staunchness is all part of his character. Willie Ross does not believe in devolution. He is a good Scot and he believes in the system of the Secretary of State. Asking him to devolve power in Scotland is rather like asking the noble Earl, Lord Longford, to open a strip joint in Soho; he cannot approach it with any great enthusiasm.

The examples of this reluctance run all through the White Paper. This can be seen quite clearly, even in the names used: the Executive; an Executive assistant. Why cannot they simply be called Ministers? Why not use the term "hief Minister" instead of "Chief Executive"? What does "Chief Executive" mean? This is a petty thing, and it is a symptom of the real belief in central power which is held by many people in the Labour Party. There are others in the Labour Party who appear genuinely to believe in devolution, and I think have realised that it is totally and entirely necessary. The vast majority of Scots feel that Scotland needs a centre of power, that Scotland needs a Parliament. The only thing that will do is a real and genuine devolution of power, with a real task facing the Members of the Assembly. If it is not real, if it is constantly overseen, if it is constantly thwarted, then we shall get miserable people standing for the Assembly. If it is real, then I will be standing myself. In order not to disappoint the noble Lord, Lord Hailsham of Saint Marylebone, let me say that it will not be real unless it is elected in a way which will show the proportions of the people of Scotland and how they think.

4.29 p.m.

The Earl of MINTO

My Lords, I ask to address the House this afternoon first because I am a Scot living and working in Scotland; secondly, because I am, and always have been, a convinced Unionist; and, thirdly, because I should not like silence on my part this time to be interpreted by any as support for a minority of my fellow countrymen who claim while in Scotland to be separatists and yet choose, when South of the Border or on other occasions when it suits them, to play with words and argue that separatism is not the aim of separatists. Fourth and lastly, my Lords, I presume to speak since I have been an elected member of the top tier of local government since the first regional elections were held in Scotland in May 1974,and I sit as an independent member for the Borders Region.

The White Paper on devolution considers Scotland on all pages except those contained within Part IV and the main Appendix F, which deal essentially with Welsh affairs. Therefore, as a Scot I find that there are a number of points about which I would normally be tempted to speak. However, since it is the first time that I have summoned up the courage to speak in your Lordships' House, since I am very nervous and since I am acutely aware of the traditions associated with such an occasion, I hope that it may be accepted that the remarks I have to make are not intended in any way to be destructive of the White Paper but rather to impart constructively some of the difficulties being faced within local government at the present time, and which will effect further devolution in Scotland in the future. Against that background I would ask to be allowed to confine myself to commenting upon paragraph 119, which deals with the relationship between the Assembly and local government in Scotland, and paragraph 289, which deals with some of the estimated costs.

My Lords, before commenting on these paragraphs it might, I feel, be of some value if I were to enlarge upon some of the difficulties which I have already mentioned exist in Scotland. It may sound odd coming from me as a regional councillor, although it may not seem odd to those of your Lordships who come from North of the Border, when I say that I have very little real fear of contradiction in saying that the most unpopular word at present in use in Scotland is "regionalisation". Some Scots wish for further devolution, and some do not; some Scots wish for an Assembly, whether it is directly elected or otherwise, and some do not; but on the subject of regionalisation there are virtually no sides. With the possible exception of a few who have a vested interest in boosting the morale of those with whom they serve, Scotland is united in its conviction that in retrospect regionalisation was an expensive mistake. The reason for this unanimity is not very hard to find. Regionalisation, while it exists in its present two-tier structure, has proved and will continue to prove extremely costly. It is true that some ratepayers have escaped increases in their rate demands of less than 100 per cent. over the demands of last year, but many have experienced increases of 200, 300 and even 400 per cent. It is no good whatsoever trying to convince the Scottish people that a high proportion of these increases is directly attributable to increases in world and national inflationary trends. Even where it is true they simply do not believe it.

As chairman of a service committee I serve as a member of the Convention of Scottish Local Authorities, and I therefore meet with, speak with and correspond with elected members of all persuasions throughout Scotland. I am told by my fellow members who serve in cities and in areas of high density population that the situation is bad enough. From experience I can say that it is of even less use to try to explain to the rural ratepayers that Westminster, in its wisdom, has decided to rate them as equals with their urban and city brothers when they, in the countryside, very frequently have no public transport—no buses, no trains—and, in many cases, no private motor-cars to take them to enjoy the facilities of the cinemas and the sports complexes. the art and the youth centres for which they are being made to pay. Fairly or unfairly, regionalisation is decidedly unpopular.

Regionalisation, as your Lordships are aware, refers not only to the reorganisation of the Scottish counties into regions but also to the division of regions into their own districts. Devolved powers have been distributed between the region and its districts and, with the exception of the Islands, this two-tier structure of local government has been imposed upon the ratepayer virtually regardless of its merits. In Scottish eyes the greatest monster to emerge from regionalisation has been the Region of Strathclyde, and I say that with the greatest conceivable respect to my friends, both elected representatives and members of the staff, with whom I have frequently had to work in that region. They are trying hard. and it is not their fault. It is a simple matter now, of course, to look backwards and to find where the fault of the original strategic planning of the Strathclyde Region lay. After all, it contains two and a half million people, or half the population of Scotland. However, if that is easy, it is certainly as easy to opt for the other end of the scale, where, in the Border Region, which I have the honour to represent, with a population of 100,000 people or rather less, the two-tier system demands that we have to pay for four district councils with separate chief executives, separate treasurers and separate administrative departments, whose responsibilities, apart from housing, are restricted to essential but minor functions. These four districts, which are immensely costly, are in being solely to satisfy the dictat that there shall be a two-tier system throughout Scotland.

I have deliberately dwelt upon some of the weaknesses of regionalisation, and, in particular, upon the common system of rating adopted within reorganisation and the imposition of the two-tier system, because I do not believe that one can turn to paragraphs 119 and 289 unless one is familiar with the problems that we are already facing within local government in Scotland today. However, I do not think that it would be fair to pass to these paragraphs without saying that all of those people, whether elected members, of whatever persuasion, or members of staff, without exception, with whom I have come into contact are doing their very best to make the best of a very difficult job. The average Scottish ratepayer may not accept this, but I believe that local government is under heavy attack because during a period of major inflation it is making a brave attempt to carry out its obligations as detailed in the Wheatley Commission Report and, indeed, as approved of by Parliament herself.

When I turn to paragraph 289 I find that I do not dispute the figures that are offered. They are, after all, only offered as provisional estimates: but history has shown that such estimates have tended in the past to be on the low side and history has a habit of repeating itself. This fear is perhaps supported by the White Paper itself when in paragraph 286 it states that the long-term cost of devolution in manpower and money cannot be calculated exactly. However, we are told that Scotland may have a thousand extra civil servnts and an extra annual running cost of £10 million. In more normal times these figures might have been acceptable to the Scottish people, but within the present atmosphere of regionalisation, which is synonymous with devolution, which I have attempted to describe I dread to think of the effect of these costs on the Scottish Vote. Even now I suppose it might be acceptable if it was felt by the people that in some way or another this staff and this extra annual charge would reduce the cost of the two-tier system of regionalisation.

When I turn to paragraph 119 I find that I am in a very grey area indeed. Following an assurance in paragraph 118 that proposals do not entail removal of current tasks or powers from local government, paragraph 119 would seem to indicate that in the longer term they might very well do just that. The word" current" is the word I fear in this paragraph. The phrase, "current" tasks or powers raises some doubts in my mind. I ask myself: are the tasks and powers to be very different in the future?

Then there is the indication that the Assembly would assume the responsibility for Central Government supervision of local government in Scotland. To me that presumes that local government is already subject to supervision by Central Government. As a democratically-elected member of local government. I do not think that is the existing situation and I therefore wonder whether in the future there is to be a new relationship between the Assembly and local government which has so far been left undisclosed.

My Lords, it is the open-ended manner of parts of paragraph 119 which cause me great worry and I would earnestly beg for clarification at this time. I am glad the White Paper does not suggest any immediate changes in local government, because the present system simply has not had the time or the chance to settle down. Certain lessons have been learned and, as the years go on, certain other lessons are still to be learned. There is only one thing of which one can be sure and that is that changes will be required and perhaps they will end in a unitary system.

However, paragraph 119 is very vague and I would suggest that if the Assembly is to come into being in the spring of1978 the Government let it be known clearly that they are committed to a further reorganisation of local government by a given date. This commitment would allow for constructive thinking to start now, not only by the specialists of Government and of local government but, more important at this time, by the Scottish people themselves. It would allow a given number of years within which the future of local government and its relationship with the Assembly would be threshed out. It would allow for reasonably early comment from local government members and staff so as to ensure that whatever system is adopted it is a system in which they have wholehearted confidence That would be unlike the system of today where many people in responsible positions have had grave doubts from the outset. Most important of all, it would offer to the Scottish people visible proof that someone was doing something to reduce their expenditure within a defined period rather than on an open-ended basis and would also strengthen and give maturity to the aims and powers of an Assembly. If there is to be an Assembly, I am certain that it must be effective for the good of Scotland and hence for the good of the United Kingdom.

My Lords, going around Scotland I have come to the conclusion that an effective Assembly is not feared by the mass of the Scottish Nationalist voters. An effective Assembly is feared by the separatists who seek to control an independent Scotland. I am pledged to a United Kingdom though I can proudly claim to be a loyal Scotsman—as loyal, I hope, as any Scot—and, despite the somewhat aggressive activities of some of my ancestors which are recorded over the past 600 or 700 years, I think that my loyalty to my country has stood the test of time. Therefore, I most sincerely ask that early notice be taken of the urgent need for the Scottish people to be told that the relationship between the Assembly and local government is actively under review. Such an action would do much to alleviate the fears in Scotland of an Assembly becoming yet another expensive arm of government in a country which in the eyes of many Scots is already overgoverned.

4.48 p.m.

Lord HUGHES

My Lords, when I put my name down to speak in this debate I did not expect the honour and privilege of being the first to congratulate the noble Earl, Lord Minto, on a most notable maiden speech. If he has not strictly conformed to the traditions of this House in being non-controversial and brief, then, as we would say in Scotland, his speech was "nane the waur o' that". He said to me very briefly before coming into the Chamber that he was very nervous about making his maiden speech. I felt that it was merely modesty that made him say that. His military record in Malaysia and Cyprus shows that fear has no part in his make-up. In the way he made that speech, I think my belief was absolutely justified for he showed no sign of fear at all. I have no reason to believe that he ever read anything which I said during the debates on the reform of Scottish local government. If he had, he would have known that what he had to say about Strathclyde would not antagonise me in the slightest.

It is now almost 15 years since I first became a Member of this House and, on looking back on what I said in some of my earlier speeches, I found that more than once I referred to the fact that more and more people in Scotland were saying, "I am not a Scottish Nationalist, but" and then went on to recite one or other of the grievances which they held against the Parliament at Westminster. I spent more than a quarter of a century in local government, and I was seven years in central Government. It was borne in on me very clearly during those 20-odd years that more and more in Scotland there was the feeling that the essential needs of the Scottish people were sometimes neglected or deferred because Parliament at Westminster either did not understand the need for them, or could not find the time to deal with them. With the passing of the years, the number of people who have thought that way and have expressed views that way has grown. I am certain that there is at the present time in Scotland an overwhelming majority opinion of people who want to see a form of effective devolution of legislative and administrative power to Scotland.

Much of the administrative power is already devolved through the office of the Secretary of State for Scotland, but the legislative power is both needed and desired. But I would not for one moment wish to suggest that the noble and learned Lord, Lord Hailsham of Saint Marylebone, was speaking only for the Conservative Party in this House or in Parliament generally when he said that they were united in being against separation, that they were united as a Party for the integrity of the United Kingdom. The noble Lord, Lord Mackie of Benshie, has joined him in saying that that is also the feeling of the Liberal Party. Whatever divisions there may be in my Party about the way in which devolution should take place, I can say without hesitation that there is no division among us in this Parliament on the subject of the need for the essential integrity of the United Kingdom. But I do not believe that we should be justified in thinking that the stage which affairs have reached in Scotland is such that any solution which can be put forward at the present time will guarantee that that integrity will take place. The best that we can hope for is that we so arrange these affairs as to make it clear to the people of Scotland that devolution within the United Kingdom is the answer, and that separation is merely the path to disaster.

If no action is taken, and if we cannot convince the Members of Parliament for English constituencies in this Parliament and Members of your Lordships' House who are English that this need is a real one, then I say without any fear of contradiction by the events which will take place, that the next General Election will very soon be followed by the demand for complete separation. A half-hearted or ineffective policy of devolvement may defera demand for separation, but it will not put it off. I should like to say how much I found myself in agreement with parts of the speeches of the noble and learned Lord, Lord Hailsham of Saint Marylebone, and the noble Lord, Lord Mackie of Benshie, when they spoke of the need for the devolved powers to be real and to be seen to be real. I do not think that giving real power will in any way weaken the integrity of the United Kingdom; in fact it is an essential element in the preservation of that integrity.

Having gone that far, I accept the White Paper as a framework for a satisfactory scheme and, in that connection, I welcome the assurances which my noble friend the Leader of the House gave that the White Paper was not the end of the story, that the Government were prepared to consider what was being said and that the White Paper is subject to revision in detail even if it has to remain intact in general policy. I know that the White Paper is not solely concerned with Scotland or Wales. It is as much a matter of interest and concern to the people of England and Northern Ireland as it is to those who are in due course to be the direct participants of the devolutionary policy. If, in my remarks on details of the White Paper, I confine myself to matters as they affect Scotland, it is merely because that is where I have gained my knowledge and experience. I know little or nothing of Wales—despite my name—and I would not suggest for one moment that I can speak for any of my English colleagues in this matter. I can only hope I am able to influence them in the way in which their Scottish colleagues are thinking.

I agree entirely with what the noble Lord, Lord Mackie of Benshie, said about the names. This is the defect which will damn the White Paper in the eyes of many people. The Scottish people are thinking in terms of a Scottish Parliament; they are thinking in terms of a Scottish Government. To have the head of that Government given a title which equates him with the principal officer of the Strathclyde region and the principal officer of the smallest district council in the North-East of Scotland. is an utter nonsense. To talk about the man who has responsibility for housing in Scotland as the "Member", to talk about a junior Minister as being an "Assistant" comparable to the newest recruit in a primary school, is going to denigrate what is contained in the White Paper in the eyes of the people who have to be persuaded about it. It is going to be a Parliament; I do not quarrel with calling it an "Assembly", because it is desirable when we are talking to know that we are referring to the Scottish body. If "Assemblyman" had been used I could have understood it, but probably the Sex Discrimination Act rules that out. But "Assembly-person" sounds worse than what is in the White Paper. The people of Scotland are going to talk about the Minister of Housing, the Minister of Health and the Minister of Education and are not going to talk about the Under-Secretary as an" Assistant". This ought to be avoided at all costs. Do not produce something that is worth while and then damn it with silly language.

I agree again with the noble and learned Lord, Lord Hailsham, and so many others who have expressed the same view in connection with the vires. If this is to be effective, the powers must be such that they can be challenged only in the courts. It would be wrong for an Assembly dominated (shall we say?) by the Labour Party in Scotland to have the vires challenged by our Westminster Parliament, Conservative controlled, or the other way round. By the same token, although I have exactly the same respect —and even greater in degree—for Willie Ross as that expressed by the noble Lord, Lord Mackie of Benshie, I do not like the extent of the powers which are to be conferred on the Secretary of State for Scotland. Mr Ross has indicated that he does not himself expect to be in that office in perpetuity, and the probability is that later Secretaries of State may not be so good. In paragraph 57 of the White Paper I do not like the phrase that in addition to the vires the Government will also consider whether the Bill is acceptable on general policy grounds. I cannot think of a sentence more calculated to destroy belief in the efficiency of a Scottish Government.

If we turn to housing—and this is a subject with which I was particularly concerned in the Scottish Office and with which I have been very much concerned throughout my working and Ministerial life—only a quarter of the people living in Scotland live in houses which they own, compared with more than a half of the people living in England. It may well be that a Scottish Government would wish to take active steps to increase owner-occupation in Scotland. It might be decided that the best way to do so would be to give some form of subsidy; but in England, with the proportion of owner-occupation somewhere between 50 and 60 per cent., it might be held to be against the general policy that such a precedent should be established, since it could lead to a demand for something of the same kind in England, where the need for it was perhaps not so great. So I do not like the idea that the Government at Westminster should be able to object to acts of the Assembly on grounds of general policy. Either the Assembly have powers to do things and should be allowed to carry them out, or the powers should rest with Westminster, in which case there is no doubt about their right to act.

Regarding the financing of the Assembly, I cannot quarrel with the idea that in the circumstances in which the Assembly will come into being the most effective way of providing finance is by way of block grant. I am certain that the schemes which are to be worked out will ensure that both Governments are in agreement that an equitable distribution of finance has taken place. The noble Earl, Lord Minto, has said that the most unpopular word in Scotland at the moment is "regionalisation". I beg to differ. The most unpopular word in Scotland and in England at the present time is "rates". When we see in the White Paper the recognition by the Government that the Assembly may legislate beyond the finance for which the block grant will provide and will therefore need access to other sources of revenue; and when we further see in the White Paper that a source of revenue given to the Assembly should be the imposition of a surcharge of up to 10 per cent. on the rates, I can imagine any Assembly attempting that particular exercise! I can think of nothing more calculated to make Strathclyde popular by comparison with the Assembly. It is a power which, if this is to be the way it is exercised, can never be debated, and yet if there is not some method of taxation which is available to the Assembly it cannot be a fully workable legislative body.

If Parliament here legislates in a particular direction, the money will eventually be found to make that legislation effective; but you cannot have a Scottish Assembly legislating and then finding it impossible to carry out that legislation because it is within the constraints of a block grant system. I do not know what the answer is. One of the things which I found as a Minister, and which all Ministers have found, is that it is much easier to criticise suggestions made by other people than to be able to put forward better suggestions in their place. As I say, I do not know the answer, but I do know that what is in this White Paper is not workable.

I should like to return to housing, because in paragraph 131 it says: The Scottish administration will be responsible for all aspects of housing, except that in order to maintain proper management of the United Kingdom economy the Government will remain responsible for housing finance in the private sector (building society mortgages and the like), and will also keep a reserve power to prevent or restrict increases in public and private sector rents where general economic and counter-inflationary policy makes this necessary. I find this totally unacceptable. This is taking the guts out of the power for housing. If we take out the objections on general policy but allow this one to remain, we should find that the Government could veto a policy in relation to private house-building in Scotland. And given the arguments over rents in Scotland, Ican think of nothing more harmful to a devolved process of government than to say that this is a field in which the Assembly cannot be trusted to look after the interests of municipal or private tenants in Scotland. Certainly I shall not find myself supporting that particular part of the White Paper with enthusiasm.

The noble Lord, Lord Mackie of Benshie, referred to the Scottish Development Agency. Like him, I cannot see either the need or the justification for dividing its control between the Assembly and the Secretary of State. This could be one of the most effective instruments of a Scottish Government in Edinburgh, and I am a convinced supporter of the idea that the Development Agency in its entirety must be the responsibility of the Assembly. Similarly, I do not like the limited restrictions which the White Paper puts on the activities of the Highlands and Islands Development Board. This is one of the most successful instruments of Government policy in Scotland. Over two decades it has established itself as a power for good in the Highlands, and I think its power would be increased rather than diminished if it were to come solely under the control of the Scottish Assembly.

Finally, I should like to refer to the fact that there are a number of functions referred to in the White Paper which will be vested in the Secretary of State for Scotland. I believe that when the Assembly is set up it is absolutely essential for this to be so; but what I should like to see in the Bill when it is eventually published is a provision that Parliament, as time goes on, may be able to transfer, by order, some of these reserve powers from the Secretary of State to the Assembly. I do not think that the reserve powers need to be the subject of separate Acts of Parliament when it might be found by experience that they could usefully be made part of the work of the Assembly. Therefore, in due course I would hope to see a provision in the Bill giving the power of transfer in that way.

I should like to finish, in this year when we have been reminded of the need to be against sexual discrimination, by saying that I was surprised to find in the White Paper that "Peers and Peeresses" would not be precluded from membership of the Assembly. I have not been aware of any restriction whatever on Peeresses. I know that the women in our midst certainly object to being called Peeresses. I think it is the intention that Peers, whether men or women, will not be excluded from the Assembly. Perhaps when the Bill comes to be drafted, it will not contain that mistake.

5.9 p.m.

Lord HOME of the HIRSEL

My Lords, in this debate it is of particular satisfaction for me to follow so soon after the notable, thoughtful and informed speech of my noble friend Lord Minto and to hear of his experiences as a regional councilor. His home is close to mine in the Scottish Borders and I think that he and I would have to confess that in the past that area has not been exactly conspicuous in the context of unity! Nevertheless, I think we have learned our lesson, and there is nobody on the Scottish side of the Border who would ever wish to see a separation from England. The Scottish Nationalist cause does not flourish very much South of Edinburgh, at any rate in that area.

I am happy to follow the noble Lord, Lord Hughes. If anybody can give us first-hand knowledge it is he, after the last few years which he spent serving Scotland as a distinguished Minister of State. We also heard—and the whole House will agree with this—two most distinguished speeches from the noble Lord the Leader of the House and my noble and learned friend Lord Hailsham. They gave us a lot to think about. I think that the debate so far—and I hope it will continue in this way—has been conspicuous for the fact that nobody has given any thought at all to any Party gaining votes from this issue. It would be fatal if either House of Parliament looked upon this matter from that point of view. What we have to do, in the greatest constitutional issue which has faced this country since 1707, is to find a consensus in Parliament, and we shall not find the right solution until a majority in Parliament is agreed.

I think it is fair to assume—I do not take any pleasure from saying this—that as a result of the debate on the White Paper in another place, and the reaction to it in the country, the Government will need to recast important elements in that White Paper before they can bring forward a Bill which will command anything like general acceptance. The Prime Minister has said so, and I was glad to hear the noble Lord the Leader of the House say much the same thing this afternoon; and in that sense this debate is timely. My intervention this afternoon will be confined to trying to find ingredients for consensus so that we may from this House propose something practical on which the Government can work.

A stranger to our affairs might be excused for concluding after the commotion of the last months that the subjects which we are debating are new. In fact, for most of my political life decentralisation of administration and government has been a regular diet of Parliamentary debate, both in the sense of lightening the load on Westminster, for which there has been a convincingly increasing case, and in the sense of bringing the practice of government nearer to the people of Scotland and Wales. The appointment of the Secretary of State to the United Kingdom Cabinet greatly enhanced the authority of Scotland's voice in the affairs of the United Kingdom. The institution of St. Andrew's House, with Ministers drawn from Scotland's elected Members of Parliament—just as good Scotsmen, it is worth reminding noble Lords, as anybody else in that country—and with its own Civil Service, was a major act of decentralisation.

It is therefore not true, as so many are being led to believe, that over the years nothing has been done. In fact, a lot has been achieved and I think that all of it has been good for the Scottish people. Doubtless improvements can still be made, but I submit there is nothing left in this field of decentralised administration which would account for the emotion the interest, the concern and the confusion which is now widespread, both in Scotland and indeed in Parliament. I do not remember a debate in the last 40 years on a great matter of this kind in which such a variety of views has been held and on which there has been so much confusion of aim. The reality of the matter—and the noble Lord, Lord Hughes, just now referred to this—is focused on the question whether it is desirable and justifiable, by the criteria of better government and administration, to establish a body in Edinburgh with a legislative function. That is what is new. But even that is not so very new.

Some noble Lords will remember, soon after the war, a proposal that the Scottish Grand Committee and the Scottish Standing Committee of another place should conduct their business from Edinburgh, and the Balfour Commission on Scottish Affairs proposed: That Scotland's needs and points of view should be known and brought into account at all stages in the formulation and execution of policy which is being considered and when policy is announced. A decade and more later a committee, over which I presided for Mr. Heath, added "and when policy becomes law". We proposed then, in 1968, an elected assembly with defined powers within the scope of the United Kingdom Parliament.

After all the consideration and delay, what does the thoughtful Scotsman want now? I believe that I can express his desires very shortly. He asks for a more direct voice in Scottish legislation and that that legislation should be conducted on the spot. The sensible, moderate Scotsman asks nothing less. But it is very important for both Houses of Parliament to understand that he is also asking for nothing more. There are some, it is true, who require something more, but they are not concerned with devolution as an extension of a partnership in the United Kingdom Parliament. They are concerned with devolution only as the thick end of the wedge on the way to a Scotland independent from England. It is imperative that the public of Scotland should understand the difference between policies which are adopted in the context of devolution which maintain the unity of the United Kingdom, and policies proposed which are intended to lead to the separation of Scotland from England. If I may say so with respect, the disservice which the leaders of the Scottish Nationalists have done to Scotland and to the United Kingdom is that, by insisting that each step towards devolution is an advance along the road to independence from England, they have made it virtually impossible to debate devolution rationally as an end in itself. The debate in another place gave ample evidence of that.

I do not like the constitutional device of a referendum, but so urgent is it that the Scots should face the political, economic and social consequences of separation from England—and I hope that the chambers of commerce, the trade unions and the employers will have something more to say on this very soon—that if the confusion in the public mind persists for very much longer, I believe that the Government may very well have to put the straight question in a referendum to the Scottish people: do you wish to be separated from England? It may be the only way to clear the ground for advance to devolution within one Parliamentary framework. Recalling what reasonable, thoughtful Scotsmen are asking, on what could the majority in Parliament agree? I am assuming the existence of an Assembly. I am assuming that as it has to perform a legislative function—and this is the essence of the matter—it must be directly elected. I am advocating that as there are likely to be at least four Parties in Scotland, and it is undesirable that the minority should call the tune, some form of proportional representation should be used.

I come now to the propositions. and I say to my noble and learned friend Lord Hailsham that the water which has passed under the bridge over the last seven years has floated me rather nearer to his point of view than I was before. There is a class of legislation now designated by Mr. Speaker as consisting of purely Scottish Bills. They cover the area of Scottish affairs in which Scotsmen desire to have a more direct say. Then there are Bills which have a Scottish content but which in general are applicable to the United Kingdom. To deal with these two divisions of Bills there would have to be some alteration to the machinery for definition and decision on appeal. I defer to the knowledge of my noble friend. I believe that he is right. If we embark on this kind of devolution, there will have to be a written constitution and appeal to the courts; and it is conceivable that there might have to be a Committee of the Privy Council. I believe, however, that the majority in Parliament could, and probably would, agree that the first class of Bills which I have mentioned; namely, those which are purely Scottish, could be taken through all their legislative stages in Scotland without coming back to Westminster.

Turning to the second category of Bill —that is, the one which has a Scottish content and a United Kingdom application —I believe we could agree that an Assembly in Scotland should debate the matter so that the Scottish point of view would be plainly before these who have to deal with the various stages of legislation but that the legislative process should remain within the United Kingdom Parliament. I do not believe that anybody would deny that this is a difficult conception, but what I am trying to find, and what I believe we have to find if devolution is to succeed, is the conception of defined powers which are given to a Scottish Assembly, allied with shared Government within the United Kingdom. It is not easy, bat if anybody can understand the problem it is the noble Lord, Lord Crowther-Hunt. I believe that such legislative changes would mean that Scotland's needs would be taken into account in the fomulation and execution of policy and when policy became law, and those changes would be real.

Secondly, I believe that the duty should be laid upon the Assembly to settle with the Secretary of State the size of the Scottish budget. Once settled, the priorities in spending should be for the Assembly alone. I do not believe—I agree with the noble Lord, Lord Hughes, about this—that any Scotsman would tolerate yet another rating authority. I do not see very much objection to the proposal put forward by the noble Lord, Lord Mackie of Benshie, that a certain proportion of the oil revenues might be allocated for certain purposes in Scotland, but if it were necessary that the Assembly should be armed with some revenue, I would prefer to see a sales tax up to a certain level. It would bring in a reasonably substantial amount of money and would be sufficiently unpopular with the public not to tempt the Assembly to go too far.

Thirdly, there is the question of the Scottish economy. The arguments presented in a document issued by the Labour Party today are overwhelming and I want others who are not politically minded to issue documents of the same kind, in particular the Chambers of Commerce who know which way Scotland's bread is buttered, the trade unions who do not want to see a division between Scotland and England and the Employers' Federation which understands how and why investment flows. These are the things which matter.

What, therefore, should be the relation of the Assembly to the economy as a whole and in particular to the Scottish economic problems? Political chambers are not conspicuously successful at running business or attracting investment and undertaking development. We in Scotland have a Scottish Development Council which has earned a deservedly good reputation. Internationally it has earned much good will. Also we have a Scottish Development Agency. Again, I agree with the noble Lord, Lord Hughes, that both of these bodies should be within the scope of the Scottish Assembly. The relationship between the Assembly and the Secretary of State is at present blurred and will, I think, need a great deal more thought to be given to it before we can be quite certain of the right answer. Finally, because in the case of local government Parliament has been guilty of putting the cart before the horse I would give the task of bringing sense into the pattern of local government in Scotland to the Assembly and the Secretary of State, bearing in mind the warning of the noble Earl, Lord Minto, that Scotland is in grave danger of being seriously overgoverned.

Your Lordships will have noticed one omission from what I have had to say. Except for the briefest reference I have said nothing about oil, or the revenues from it, for two reasons. The oil of the North Sea has a limited life and I suspect that some of the revenue has already been mortgaged. To allow the prospect of short-term gain to influence our thinking regarding the future of Scotland's government is to sell our heritage for a mess of pottage, and no Scotsman should be guilty of that. I have suggested certain propositions in terms of transfer of power to which I believe a majority in Parliament might consent. They are in the context of better government and the wishes of thoughtful Scotsmen. There are risks; the stake for which we play is extremely high. It is no less than the influence of the United Kingdom far and wide not only in our own country but overseas. I can imagine what foreigners would think—how, for example, the Russians might laugh, and I hope I shall not be accused of being provocative ! —if the United Kingdom were to be split into three. There are risks but we have a genius for political adaptation. In my estimation, we have now reached the point where it is a case of "Nothing ventured, nothing gained". I believe that we should venture but that we should know at what we aim and exactly what we want to do.

5.28 p.m.

Lord BELHAVEN and STENTON

My Lords, I should like to apologise to the noble Lord, Lord Shepherd, and the noble Lord, Lord Hailsham of Saint Marylebone, for not being here when they made their speeches. I understood that I was to speak tomorrow, but when I arrived this afternoon from the Western Isles at the earliest possible moment, that is to say at 4 o'clock, I found that I was on today's list. I feel, therefore, that I have been thrown in at the deep end and hope your Lordships will forgive me if my speech is a little bitty. May I say that I very much regret having missed those two speeches. However, I was privileged not to miss the very excellent, if not entirely non-controversial, maiden speech of the noble Earl, Lord Minto, and I hope that this will not be the last time that we shall hear him in your Lordships' House. I do not consider that a little nervousness about speaking in this House is a bad idea. I am sure that the noble Earl will go from strength to strength when he is really controversial and begins to tear to pieces some of your Lordships' arguments, which I am sure he is very capable of doing.

Perhaps I may presume to make one small correction to the speech which preceded mine; namely, that of the noble Lord, Lord Home of the Hirsel. He said that the SNP had very little support South of Edinburgh and Glasgow, but I understand that in the last General Election they captured the constituency of Galloway, in which I lived for many years. However in general his thesis is correct, that there is less support in the South than in the North.

I now come to the point which makes it slightly difficult for me to address your Lordships, because I am the only Member in your Lordships' House of the Party to which I belong and I do not know which hat I should wear. However, basically in your Lordships' House we speak for ourselves and upon our honour and I hope your Lordships will take it that I am doing just that. I am not a mouthpiece of the Scottish National Party in this House; I merely happen to be a member, which is something quite different.

With regard to the White Paper, surprisingly I should like to congratulate the Government upon bringing it out. When just over a year ago they said they were going to bring out a White Paper I frankly gave them the benefit of the doubt but I did not think they would because I believed that the task of producing a White Paper on this subject would be impossible; and albeit having only arrived in your Lordships' House at 4 o'clock this afternoon, having only just read the White Paper, I am beginning to think that my conclusion was correct. It seems to me that no matter how one tries to work this thing out it is only possible in one context to have a Scottish Parliament inside the United Kingdom, and this would be a federation of the United Kingdom. The English people do not want a federation so this is an impossible dilemma—a dilemma which I always believed existed—that the United Kingdom is either a unitary State or it is nothing. I do not believe that anything that has happened in the Northern Ireland experiment invalidates that: the majority in Stormont were only there because they wanted to stay in the United Kingdom.

It might be very different with the majority in the Scottish Assembly which, by the way things are going in Scotland, might well be Scottish Nationalist. Frankly, I do not think this should put your Lordships or anybody else in a state of terror because I happen to know quite a lot of Scottish Nationalists. It is a new Party and some of us in it belonged to other Parties until quite recently. It is a Party which is gaining new ideas all the time and as new people come in I think it will be a moderating influence which will make the Scottish Nationalist majority in the Scottish Assembly perfectly capable of being dealt with in a reasonable way. To do them justice, for many years they have campaigned in a perfectly legal manner to gain seats in Parliament. The methods of the SNP may on occasion be objectionable but quite frankly so are the methods used by members of other Parties—Labour, Conservative and Liberal—when they get excited.

I should like to expel the idea that possibly Scottish Nationalists are overemotional, and to bring it home to your Lordships I would illustrate this by reference to the area of Scotland in which I live, which is the small island of Islay which produces some of the world's best whisky. It has 4,500 inhabitants of whom I think 4,000 drink whisky and 80 per cent. vote Scottish Nationalist. It is not abnormal to be a member of the SNP in the island of Islay. One is not a member of the lunatic fringe. The village schoolmaster and most of the local worthies turn up at SNP meetings and behave themselves perfectly well. They are not out to establish some sort of mad dictatorship in Scotland; they are a democratic people who are seeking to work out the problems of Scotland, and Scotland, being a very old country, is probably now capable of working out those problems for herself after many hundreds of years of civilisation. This is particularly so when one takes into account some of the countries which relied upon Great Britain and which are now making rather a mess of working things out for themselves.

I should like to concur with those who say that if this White Paper is brought into operation it will make Scotland over-governed. In my brief scribbles which I made as I came into your Lordships' House, I have a line which says: "Brussels, Westminster, Edinburgh, region, district". So everybody in Scotland will now have five governments, and I concur with the noble Earl, Lord Minto, that the regions in some form or another must go before they get totally entrenched, and I hope without upsetting anybody too much. We have heard about the big salaries that people are getting. Obviously one cannot sack a lot of people, but I think the regions are not popular in Scotland; they are totally meaningless. On a sideline I wonder whether the noble Lord who is answering for the Government knows how much has been spent by Scottish local authorities on erecting boundary signs on main roads to tell people heading for Argyll that they are entering the Strathclyde Region when they come over Beacon Summit. So far as I can see, it is really of no interest to anybody at all, except possibly a demented bureaucrat.

Also it is possibly a pity that the method of election is following the Westminster pattern of single or double member constituencies with a Westminster method of voting instead of proportional representation. I think we should make an attempt at proportional representation in one form or another, and particularly in Scotland—and if the noble Lord, Lord Mackie of Benshie, will forgive me in the meantime for leaving out the Liberals I think at the last Election the Conservatives and Labour split the Scottish vote more or less between them. As I understand it, the Labour Party got 42 seats, the Conservatives 15 and the Scottish Nationalists 11. That is not what anybody could call a democratic result and it does not carry conviction with the Scottish people.

I also agree very much with the noble Lord, Lord Hughes, in his comments on the title "chief executive". It is a most unfortunate title. It does not seem to me to mean chief bottlewasher; to me it seems more like "big brother". In fact, for the regions and districts I far prefer the title "county clerk". The county clerk was an approachable sort of chap —one might even get him on the telephone and shout at him. But people would be terrified to go to a man with the formidable title of "chief executive". I think we should do better to call a spade a spade and call a Prime Minister a Prime Minister because that in fact is what he is. Why beat about the bush?

I never say very much to your Lordships on oil because frankly, apart from filling up my car with petrol, I do not know very much about it. I would only make one small comment. So many people come to me and say how selfish it is of the SNP to talk about "Scottish oil". I find this hard to understand. Is it therefore selfish to talk about "British oil"? If we are to be unselfish then we should not talk about "British oil" but let the oil in the North Sea belong to everybody and possibly give it to an undeveloped nation to help it to develop itself. I think it must be British oil now but should Scotland become independent then it will be Scottish oil; should the Shetlands become independent then it will be Shetland oil. We could bring it down to absurdity but as the area has been delineated as being part of Scotland, as I understand it (although it does not look like it on the map, being 300 miles out in the North Sea), I can see that it is Scottish and at present, in the context of the United Kingdom, it is British.

My Lords, that concludes what I want to say, except that I would add that I agree with the noble Lord, Lord Hughes. I am a little apprehensive about the powers of the Secretary of State, who is something of a viceroy, I think. Looking back on Scottish history, we had a Scottish Parliament and a Lord High Commissioner, who came with his orders from the King in London, to tell the Members of the Scottish Parliament which way they were to vote; and being sensible, the Members of the Scottish Parliament usually voted the way the Lord High Commissioner told them to. It brings back unhappy memories to have someone in that particular position whose remit is from Westminster, not from Edinburgh.

5.41 p.m.

Lord RHODES

My Lords, as this appears to be an almost totally Scottish debate, I begin what I have to say with some temerity. Nevertheless, I am speaking as one from part of the United Kingdom which, up to now, has not raised its voice on this matter but which will do so in due course, because I am convinced that interest in this topic is increasing from the Humber to Merseyside. When I listened to the noble and learned Lord, Lord Hailsham of Saint Marylebone, talking about sirloin, I was reminded of the two boys coming home to their Sunday dinner. One said to the mother, "Why do you give our John more meat than me?" The mother said, "Because he is a bigger lad than thee"; and the lad said, "Aye, and he always will be if he has more meat.". Not that you can relate that to the population, because the population about which I am speaking is something in the region of 11½ million.

My Lords, before I come to the points I want to make, may I say quite humbly that I have no antagonism towards the Welsh, to what is proposed, or to the Scots; it would be very foolish and out of context if I had. In the case of the Scots, I have been in business with them: I have fought with them; I have covered one of the finest Divisions in the British Army, the 51st Division, and I have been as proud of them as I have been of the West Riding Division. The only thing I have against the Scots is that my wife thinks I ought to have been one! With regard to the Welsh, let me say at once that as a fan of Dylan Thomas and a fan of the Welsh Rugby Union team—

Lord DAVIES of LEEK

Hear, hear!

Lord RHODES

there is not a Saturday afternoon when the Welsh are playing that I do not watch the game, waiting for Gareth Edwards to pick up the ball after a scrum, and waiting for John Williams to race down the touchline. I am proud for Wales. We are short of pride today. We are short of pride in our institutions, and when it arises, we must treat it with respect. When Wales has pride and when Scotland has pride, we look not so much with envy, jealousy or rancour but with a kind of yearning.

My Lords, there are certain things I should like to say on behalf of people who have talked to me. I do not know much about this problem of devolution. I would not say I was learned in Parliamentary draftsmanship. I would not say I could rival those people who have been designing forms of government over the years, but I do know what the thinking is in my own locality; the North and in Yorkshire and on Humberside. They are very puzzled. We regard the present situation in this country, and in Scotland and Wales, as part of a world-wide eruption of dissatisfaction with the status quo, a dissatisfaction with the distribution of wealth, a dissatisfaction with the uncertainty as to whether or not we are going to be able to earn a living in this world.

We are discussing the question of devolution with a background of non-growth. We go on and on, arguing case after case, legislation after legislation, without understanding or debating thoroughly the basic question of our time; that is, whether or not we can grow, whether we can evolve a social system which is equitable, so that people are paid what they are worth for their service to the community. These are problems which are never raised in this House. Take the Industry Bill from front to back, there is no mention of growth—not one. The only suggestion of growth is the word "development", introduced at a late stage by the Government.

My Lords, the automatic consequences of a no-growth situation is that we divide up what there is. So long as people demand more than their fair share of what there is, there will be less for others. I do not think we shall reach the point where we will be taking down pictures from the walls of our museums and art galleries to pay our way. We might not reach that point, but it is only what we did in the days when other people in other nations were in the same pickle as we are in. That is why, with this background, we should be very careful about the way we behave with regard to this problem; because you are awakening ambitions in other people's hearts besides your own and, particularly, in areas like the North where so much needs to be done. Here I catch sight of the noble Earl, Lord Minto, and I apologise to the noble Earl that I did not start off my speech by mentioning him. The noble Earl made one of the best maiden speeches I have heard in this House. It was a good one. I hope that he will be heard many times in the future.

The Leader of the House in his fine speech made three points. The Leader of the Opposition pro tem. made three points. I want to make four, and these are the questions that are put to me in my journeys round the North-West. What underlies this devolution? Is it political expediency? Listening to the last speaker, I should think it was. I do not think Lord Home was wrong in suggesting that the SNP has done more than anyone to make a rational debate on this subject possible. This is what we are afraid of, we Britishers, in the English regions. Tell us that it is not political expediency if you can. Then look at the pamphlet issued today by the Scottish Council of the Labour Party, explaining what they mean in terms of devolution, and also the idea of the acquisitiveness and greed which has underlain much of the agitation which has pushed the Government towards this proposal for devolution.

Is it national pride? I can understand it if it is and admire it, as I have said before. Is it self-sufficiency? Is it because of this oil that we have in the North Sea? —because, believe me, there will be an enormous amount of re-education to be done. Whoever has led the Scottish people into thinking that it is a bonanza, they want to forget it. There is no bonanza. It is already mortgaged to the hilt, and from the point of view of the English I would say you can have it;we will give you all the capital that has gone into it. You do not need to do anything towards amortisation, either. You can have it. And it would pay us. Time was, when I was in the House of Commons, when regions used to make their claims. I have heard the Midlands say in the old days," The rest of the country depends on us. The coal has gone down, the cotton industry has gone down. And look at us, we are the country's salvation; we are the people who can keep it going. "Look where they are now. Cap in hand for £160 million for Chrysler. People want to be very careful in these very dangerous times about boasting how well off they are. Did not we see the Prime Minister going to Rome? Did not we see the Foreign Secretary going to Rambouillet. What was the main burden of their reported conversations? A floor price for oil, and all they could obtain was an offer of seven dollars a barrel. It costs nine dollars a barrel to extract. So somebody will have to do some reeducation in terms of this so-called oil bonanza.

I do not wish to pursue the North-Western argument for too long, but let me say that, if it is not self-sufficiency that Scotland pleads but deprivation, or that Scotland has not had a fair crack of the whip, I can assure you that we can match it and more so. There is not a county officer or a town clerk in the whole of the North-West who, over the last 10 years, when he has returned from conferences at national level, has not come back bitterly disappointed, and always with the same tale," We did not get what we wanted, but the Scots did". This is true. This is what you have got to face in coming debates, and the English regions will not be satisfied until they get equal treatment with Scotland. This proposed Assembly is underpinned by £2,000 million, which is the proportion of the devolved items that is to be handed over to them. Not only that. There is another £200 million which has been given to the Development Agency. Is it realised that the Scottish Assembly is to have a right to dispose of the block grant, and also the £200 million in the kitty of the new Development Agency, as it wishes.

With regard to the right to raise funds by local taxation, the North-West has nothing like these opportunities. The contact the North-West has with the National Enterprise Board is a small office which is nothing more than a tiny branch. This will not do. Our population in the North-West is as big as that of Scotland and Ireland. When you add the Humberside and Yorkshire to it, it is bigger than that of Scotland, Wales and Northern Ireland combined. I say, quite quietly but categorically, you are only starting on this troublesome race of acquisition. If this goes through, we say that we must be treated exactly the same.

I will not keep the House any longer. I believe that all this is because of political pressures, I think it is justified on the question of national pride, because I wish we English had a lot more. But I think that this White Paper is as a result of policies not thoroughly thought out, policies which have not in mind the welfare of all the regions in Great Britain. For goodness' take! why cannot we look at the United Kingdom as a single economic unit. We are too small to be split into regional units which think they could do better on their own. To those who assert the contrary, I would say that to think that we have sunk to this self-immolation without having a programme as to how to deal with the problem of how we are going to earn a living in this distracted world is sometimes a heartbreak.

Thank goodness! I have sufficient faith in the maturity of the political animal in this country to evolve something better out of it. But, whatever we do, for God's sake do not let us do it in a hurry!

6.1 p.m.

Baroness ELLIOT of HARWOOD

My Lords, we have had very remarkable speeches in your Lordships' House this afternoon, if I may say so not for the first time, because I think that on the whole our debates here are always of a very high calibre. I was enormously interested in the opening speech of the noble Lord, Lord Shepherd, and in the brilliant speech of my noble and learned friend Lord Hailsham, and I was in agreement with much of what the noble Lord, Lord Mackie of Benshie, had to say, and also with what my noble friend Lord Home had to say. I was particularly glad to hear the maiden speech of the noble Earl, Lord Minto, who expressed a most fundamental and important point of view. As I know, since he succeeded me on the Borders, he is a really hard working member of the Regional Council. He has already made a great mark in the reorganisation of local government in under a year, and what he had to say about it today was of the greatest importance. I should like to congratulate him most heartily on speaking so forthrightly and with such knowledge in your Lordships' House this afternoon. I was also delighted to hear the noble Lord, Lord Rhodes. He is the first person in this debate who has spoken from England, from the North-West; one of the greatest of the industrial areas of England. I so agree with him that one must not take a narrow minded point of view in all this debate. I also agree with him that it is in the context of the United Kingdom that anything one is going to say has any relevance, because I am sure that that is of vital importance.

I spent quite a lot of time last week listening to the debate in the other place, and found myself more muddled at the end of three days of listening to that debate than when I started off. In fact, there were very few Members of Parliament who spoke with one voice. There has been far more unanimity and simple agreement about many points in your Lordships' House today than there was in four days' debate in the House of Commons. I hope that Members of the Government will see to it that when the further discussions begin in the Cabinet what has been said here in your Lordships' House will be given due consideration.

I take the view that the reorganisation we are thinking about, the devolution to Scotland (I am not speaking about Wales because I do not know about Wales) must be viewed in the first place as what is best in the machinery of Government —nothing to do with a political view at all. What we set up in Scotland in the way of an Assembly has to be the best political organisation for that job. It is not a political gesture; it is finding the right way to develop, or develop further, the idea of devolution. I should like whoever is dealing with it to consult all different sides of Parliament, commerce, industry, local government people of course, and the structure that comes out must be something which is the best for the job and not just something which is supported by the Labour Party, the Conservative Party, or the Liberal Party. What happens inside the Assembly then becames Party politics, because inevitably that is the way we run our political democracy. That is the political point: that is where the political discussion shall take place. However, the framework should be agreed and should be the best for the job.

I entirely agree with what has been said by all speakers so far that we must not, and should not, break up the United Kingdom. In the House of Commons, if I may say so, that also was a dominant theme. I think it was only the SNP who talked in terms of separation and of breaking up Parliament. I hope we shall all agree to stick to the principle not to break up the United Kingdom.

We could not have foreseen it, but it was unfortunate when we were planning the reform of local government—and I took an active part in that because I gave evidence before the Wheatley Commission —that we were never asked to consider local government in relation to a Scottish Assembly. We were asked to improve the structure of local government, make it more efficient and economical, and nobody asked how it would fit into any form of devolution. Unfortunately, we have reformed local government. It has not turned out quite as we all hoped. The noble Earl, Lord Minto, gave us a rather graphic description of what is happening. But I still consider that it is early days to take any definite judgment about this. One thing which is quite certain is that it will not fit into a government in which we have 142 elected representatives to form an Assembly, three tiers of local elected authorities, and 72 Members of Parliament on top of that. This makes the proposition of government, and the machinery of government, in my opinion, quite impossible. I think it would be advisable, in forming plans for the Assembly, that we should go back to a single tier of local government, which would need to be worked out in the light of experience.

As the noble Lord, Lord Hughes, said, we Scottish Peers all joined together here to vote for the break-up of the Strathclyde Region before it started. I wish to goodness that the Government had paid attention to us in those days and had done what your Lordships thought was advisable; namely, to have four regions instead of one in Strathclyde! Certainly it would have made it much more effective and easier. Nevertheless, we have to realise that this form of the current reorganisation of local government is something which will not fit into the new concept of 72 Members of Parliament at Westminster and an Assembly as well.

I should like to see the subjects which are dealt with by the Assembly kept separate from the policies and areas of political responsibility for Westminster. I should like to keep within the United Kingdom Parliament all international affairs; defence; trade; Commonwealth affairs; industry and economic affairs, allocating, as is done now, a grant for Scottish affairs on the same system as the block grant system. I should like to allow the Assembly to be responsible for all the internal affairs of Scotland; law and order, local government, social work, education, housing, roads, transport planning, and agriculture. I agree with the noble Lord, Lord Mackie of Benshie, that agriculture should be one of the subjects that the Assembly should have, even though it has wide international connotations as well. I should let the Assembly deal with all those matters, deriving their main finances from a block grant. I should not like the Westminster Parliament to have power to overrule subjects which have been delegated or devolved to the Assembly and I should not like the Westminster Parliament to have a power of veto over those subjects or devolved matters. I should like the Westminster Parliament to be in a position to deal with United Kingdom affairs in which Scottish Members of Parliament would play just as important a part as they do today. Scottish Members of Parliament would be as integral a part of the United Kingdomas they are now, but the Assembly would, in my opinion, have a very important section of responsibility and the only way in which they could be checked would be, as the noble Lord, Lord Home of the Hirsel, said, by going to the courts and the courts would be able to decide whether they had the right to take whatever decision had been taken. In that way we could avoid the narrow nationalism which I and many noble Lords dislike very much.

I am as proud of being a Scot as anyone here, proud of the fact that Scotsmen and Scotswomen have played an important part all over the world, with no fewer than eight Prime Ministers in the last 80 years who have been Scotsmen and with countless distinguished scientists, authors, professors, artists and musicians whose names are known throughout the world. This is of vital importance, but it is something about which we should not take an insular or nationalistic view. I appreciate that the English have had just as many distinguished people on an international scale and I do not want to see any of that intolerance, narrow minded nationalism or arrogant spirit which can so easily be adopted by people because they are asking for an independent Parliament or an independent country. This is the form of nationalism which is the curse and tragedy of the world today, and one needs only to turn on the wireless at any hour when the news is being broadcast to have confirmation of this.

While, therefore, I am in favour of devolution, I am concerned that it should not pander to any form of narrow mindedness or nationalistic spirit, because I agree with the noble Lord, Lord Rhodes, that this is a moment when we should be looking outward, trying to do something which will benefit the whole nation. In addition, we have a great role to play overseas. We are working closely with Europe and we can do a tremendous amount, for example, in terms of the policies for the underdeveloped areas. We can make our contribution just as any other country can, but only if we are united. Noble Lords who are not Scots may not appreciate that we are the most argumentative race in the world. Get two or three Scots together in a room and start a discussion about religion or politics and it will go on for hours. Everybody will enjoy themselves enormously but on the whole they will not get very far with the subject under discussion. If we were to encourage that sort of discussion and argument and give further opportunities for it we would be doing something detrimental to the Scottish nation.

I was shocked the other day to read in the Scotsman how two of the regions had a frightful argument over how they should set up the small community councils which arc the bottom tier of reorganisation. Apparently everybody walked out in rage. If we cannot sit together and decide how to organise small groups of what amount practically to parish councils that is not a very good sign. We are in danger, unless we are careful, of having too much government, too many fingers in the pie, too many busybodies all wanting their own way and nothing working out any better.

Apart from that, as the noble Earl, Lord Minto, said, all this will be extremely costly. In the document Devolution I note that the cost of all this is put at £22 million with £4 million to set up the two Assemblies. I doubt whether even these figures are big enough, but they go to show the enormous sums of money involved, sums which should be viewed with great care before we agree to spend them. We had hoped when we gave evidence to the Wheatley Commission that regional government and reorganisation would mean fewer officials because the areas would be larger. We thought there would be no need, as in the case of the area in which I live, for four county clerks, four directors of education and four directors of social work. In fact, it has cost more because although there is one top man in each case, he has four people immediately beneath him. In other words, we have changed the name but not the organisation. It is important, only not popular but that it does not necessarily mean a more efficient and better form of government.

I hope that before we make any major alterations we will look very carefully indeed at the best Parliamentary system that we can evolve for devolution. I was glad that the Prime Minister said that the White Paper was only up for discussion, that there would be many suggestions and that all of them would be examined. I do not want this discussed on Party political grounds but in terms of perfecting working arrangements for better government. I should like to see a clear distinction drawn between United King-don responsibilities, in which Scottish Members will play a vital part, and those responsibilities which are devolved and which should in my opinion be the responsibility of the Assembly, without powers to be overruled.

I agreed with what the noble Lord, Lord Hughes, said on the subject of nomenclature. Some of the names that have been suggested are not very good. We in Scotland already have an Assembly which meets every year and is called the General Assembly of the Church of Scotland. When one talks in Scotland about "the Assembly" one normally thinks in terms of that Assembly which is important in the government of the Church of Scotland. It might be advisable, therefore, to give more thought to the best way to distinguish between the Scottish Assembly about which we are talking and the General Assembly of the Church of Scotland, otherwise confusion may arise.

I return finally to the most important point, which is that we should never allow the United Kingdom Government to be broken up. Those who have lived through periods of war and peace appreciate how we have fought for freedom; we have fought against dictators, we have had great influence in the world and I am sure that in the years to come we will continue to have influence. However, we will not have it if we are split up into small countries, each speaking for and representing only a very small part of the United Kingdom. So I hope that it will be the guiding principle of the matter that whatever happens we are to remain a United Kingdom. After that, we can discuss further how the machinery works and I hope that the Government will be good enough to take into consideration all points of view, not only that which they represent today. In that way, I believe that we shall be able to work out a proper and good scheme on this matter of devolution.

6.21 p.m.

Lord KILBRANDON

My Lords, I begin by offering an apology inasmuch as my judicial duties made it difficult for me to hear all the opening speeches, though I heard most of them. It gives me great pleasure to follow my noble friend Lady Elliot of Harwood who for many years now has been an ornament of government, both central and local, in Scotland and is one of the great citizens of her time. I remind myself also that it is a very short time since your Lordships allowed me to say something about the work of the Royal Commission on the Constitution, a body upon which must be laid some of the responsibility for our present perplexity. For that reason, I propose to be brief and I shall divide my remarks under two headings: the first is how far the situation has changed since 1973 when we reported and the second is whether there has been any significant development in opinion since the publication of the White Paper itself.

As regards the White Paper, I would only say that I cannot but feel a certain gratification, as one who signed the majority report, that, so far as I can see, the White Paper proposals follow fairly closely the recommendations of that majority. I hope that my noble friend Lord Crowther-Hunt is congratulating himself also in that, so far as I can see, the proposals for Wales are not dissimilar to those which the minority report recommended. I should like also to take the opportunity of saying that, for my part, I am extremely pleased at the new responsibilities which the noble Lord has been given because I feel that they will be valuable in this connection. I propose to speak this evening only about the Scottish proposals.

First, there has been a marked change in public opinion. The mood in 1969 when we began our deliberations was undoubtedly one of apathy. I was pleased at the evidence this evening that that apathy has been dispelled in North-West England and I listened with great interest to the speech of the noble Lord, Lord Rhodes. I am conscious that, in some respects, the report of the Royal Commission did not do justice to England. I do not believe that we were altogether to blame for that: we had great difficulty in finding out what England wanted and, indeed, the not very adequate proposals which we put up in the end came largely from a meeting which we held in the City of Preston, so perhaps there is something to be said for us. I believe that most people thought our inquiries covered old ground. Everything has been said and argued before, and the general expectation was that whatever proposals we came up with would, as usual, be quietly swept under the carpet. We held public meetings in many cases and it is perhaps significant that the public meeting which was best attended at least upon a proportional basis—was that held in the village hall on the island of Sark. There have been enormous changes and I will not elaborate upon that because it is a subjective impression, but I am sure that at this moment public opinion would net tolerate a retreat from policies which appear already to have been decided upon.

The second change is political. In 1973, we said: On any impartial assessment, the Scottish National Party must still be counted a small minority party which has failed to consolidate its political position; on present evidence it seems unlikely that the party will gain the support of the Scottish people for its policy of complete independence. It is clearly not possible to maintain the first part of that assessment now, because the party in question is, I believe, the second most powerful party in Scotland and, for all I know, it may increase its hold. The second part of the assessment—that the party was unlikely to gain the support of the Scottish people for its policy of complete independence—is, in my own opinion, still true. My impression is that Scottish public opinion is a long way short of demanding complete independence. Nor do I know whether that is the policy of the Scottish National Party—it is not my affair.

This takes me to what I believe to be a deserved criticism of the White Paper. During our deliberations we heard again and again of misgivings about one party rule. Then, it was the Labour Party. People said that we were asking for perpetual Labour Party government in Scotland. Northern Ireland was said to be an awful warning of the dangers of one-Party rule. I cannot say that I subscribe to that view. The situation in Northern Ireland is quite different. There, we have had a supersession of normal political differences by an overriding insistence on an overriding condition—that is, union. My view of Scotland is that if it wanted a perpetual Labour Government it would have a perpetual Labour Government and that if it became fed up with that Labour Government it would throw it out in the ordinary way. However, we paid sufficient attention to those misgivings to recommend electoral reform by way of proportional representation. It may be that the danger is now more real than it then was. Is it possible—and I only ask rhetorically because I have no means of knowing—that the Scottish National Party, pledged to separation, could become the permanent Government of Scotland so that separation instead of union overrode all other political considerations and caused a one-Party Government? I do not think it very likely, but I suggest that our recommendation for proportional representation is even more worthy of consideration than it was then. I feel that it is a credit to the Scottish National Party that, so far as I know, it is in favour of proportional representation, and I believe that the White Paper is wrong to reject it.

A further area of disagreement between the White Paper and the report of the Royal Commission is on the subject of Scottish representation at Westminster. There were three possibilities before us. The first was to leave the representation as at present—that is, with 71 members. That appeared to us to be wrong on any view, especially after devolution. Another possibility was to reduce Scotland to an arithmetical equality, with due allowance for such geographical difficulties as might be foundin such places as the remote Highlands. A third possibility was to reduce Scotland below that arithmetical equality in consequence of the fact that a great deal of the business that went on in Westminster would no longer concern Scotland. I believe that the second and third arguments are defensible. I do not believe that the first is. It is not fair to the English and I hope that it may be changed.

The White Paper leaves open the question whether a challenge to the validity of a statute of the Assembly on the grounds of its being outside the latter's powers should be dealt with politically or judicially. This has nothing to do with policy objections to the statute, though I am sorry to sec that, as the noble Lord, Lord Hughes, pointed out, these two matters are confused in paragraph 58 which he read out. They are treated as being on the same footing which, clearly, they are not. I entirely agreed with the noble Lord when he said that it should undoubtedly be a judicial decision. It is the right of the individual which must be protected and I am afraid that it needs protection against the natural incilinations of the bureaucrat which one can see creeping into print in paragraph 64, where the arguments against judicial review are set out. The paragraph says: Against judicial review, it can be argued that its exclusion would have the merits of simplicity and finality and would therefore reduce doubt and room for argument, which might otherwise hamper good government… My Lords, I think we know what that means! The important thing is that this protection of the citizen should be available in the courts of the land—and in the lowest courts of the land. A man who is charged with an offence against a Statute passed by the Scottish Assembly should be able to say in the magistrates' court, or the equivalent, that that Statute is ultra vires. He can do it in Northern Ireland and I see no reason why he should not do it here. That makes for this purpose the setting up of an elaborate system of administrative courts quite unnecessary. That might be a concomitant of federalism, or it might not, but it does not affect the question of whether it is judicial or political control of vires that is required.

On federalism, like the report of the Royal Commission, the White Paper is against it. For my part, I am still against it in the classical sense; that is to say, of powers surrendered by sovereign States to be exercised on their behalf by a federal State, the federal State and the provincial States both being sovereign in their own spheres. There are many technical difficulties in the way of that in this country; and there are many practical difficulties, too, which I shall not go into. But I wish to say a word about sovereignty. Sovereignty is really a will-o'-the-wisp. Where is sovereignty? is the question which has perplexed law students from the day they begin their studies.

My dear friend and predecessor Geoffrey Crowther said that there were only two aspects of sovereignty today. One was to print money, and the other was to pull the trigger. The last time that any question of pulling the trigger in the exercise of sovereignty was seen was the affair of Suez, and I think that it is not likely to occur again. As for printing money, of course we can print money; I have heard it suggested that we print too much of it! But when it comes to sovereignty we must remember to make polite noises to the IMF.

There is another limited meaning of the word "federalism", and I am not sure that we quite appreciated this in the report, but I have a strong suspicion that it is now appreciated by the Government, which I find a great encouragement. It was inherent in our proposals that if there is not a federal system there must be a last resort in what I shall call the sovereign Parliament to govern regardless of what the inferior legislature may do. That must be so. These powers must be there. They were there in Northern Ireland, in Section 75 of the Government of Ireland Act. They were not exercised for half a century. They were exercised only when civil war had broken out; when civil war has broken out no constitution can survive.

In other words, it was a convention of the Constitution that this power in Section 75 would never be used. From what I have seen of pronouncements by mem- bers of the Government, I think I am right in saying that they expect it to be a convention of the Constitution that sets up the Scottish Assembly that this power will not be used against them, either. I think that the noble Lord, Lord Hughes, was indicating that this was almost a necessity; that is, that the thing would not work. As my noble and learned friend said, the whole thing would be on square wheels unless this were a convention of the Constitution; and it could not possibly work. In this sense possibly the relationship would be a federal one, in just the same way as there are some people who say that there is no federal constitution left in the United States, since the financial power of the Federal Government can overrule States in matters which the Constitution has confided to them as part of their powers.

Lastly, my Lords, my friends come to me sadly and say: "If the worse comes to the worst does this mean a break-up of the United Kingdom?" I am afraid that my answer to them is: "It does, and it doesn't". After all, we must remember that there was an irreparable fracture of the United Kingdom in 1920. I do not know how much further that break-up may go. But the Union of 1707, like other political expedients, has no a priori claim to immortality. Why did it happen? It happened primarily in order to prevent a war breaking out between England on one side and Scotland and France on the other. Thank heavens! it did prevent that; history has been the happier for it. That is what it was for. The state of opinion at that time was very much against it.

Here I shall say the only thing I propose to say about a referendum. Referenda are new animals. They are not yet well accepted in this country, although they are perfectly respectable elsewhere. One thing is quite certain. If, in 1707, or for many years after that, it had been possible (which it clearly was not) to have a referendum, there would have been a resounding, "No" from both England and Scotland, and the union could never have taken place if it were to depend upon a referendum. It was only a year or two after 1707—I think it was 1711, but I am not quite sure—that there was a Motion in this House to advocate a union. There voted an equal number on both sides, proxies were called in, and the Motion was lost by two votes. This gave one an idea of public opinion at that time.

As to the sanctity of the United Kingdom, a noble Lord wrote, at the height of the power and prosperity of the United Kingdom, when that power was expected to be permanent: Our little systems have their day. They have their day and cease to be. They cease to be, my Lords, when they have served their purpose. If we are wise they do not cease to be before they have served their purpose, but they should not be kept on as institutions existing for their own sakes. I simply do not know whether the United Kingdom can survive in the political sense. But there is another sense in which I am perfectly certain that it can, and will, survive. Over the past 250 years bonds have been forged which I do not see being ever broken—bonds of love, friendship, kinship, language, literature, morality. These are all influences which bind where political and constitutional influences may be obsolete and, therefore, unacceptable. Above all, of course, we are all unified by loyalty to the Crown. Whatever may be the outcome of these deliberations of your Lordships—whether it be devolution, or federalism, or even, perhaps, separatism—I am myself perfectly sure that the United Kingdom, in the sense that I mean, will be here when my children and my grandchildren are dead and gone.

6.38 p.m.

Lord BALERNO

My Lords, it is indeed an honour to follow the noble and learned Lord, Lord Kilbrandon, whose Report has made possible logical and straightforward debate, the facts being there so clearly set out. Added to that has been his illuminating analysis of the present position. I feel it rather an awesome task to be following the noble and learned Lord now. One of the interesting things about this debate on devolution in Scotland—more particularly, perhaps, as it was conducted in another place—is that the whole idea of any degree of independence for Scotland seems to have taken so many of the English completely by surprise. Yet the signs have been there for over a century. Of course those of us living in Scotland have always been better able to see and interpret these signs, especially if, from time to time, we have had contact with countries of the old Empire.

Twice in my life have I found myself in this position, and both times in the wars. In the First Great War I served with the Scottish Division, and in the last war with the Highland Division; and there can be no question that the spirit of a distinctive Scottish nation was deliberately fostered as a stimulant to morale, and that it was willingly accepted by the troops. Hence the flamboyancy of these divisions which, on occasion, irritated the English not a little, although I am glad that the noble Lord, Lord Rhodes, was an exception. The Scottish units were not the only flamboyant ones. The Australian Army was equally flamboyant, and the New Zealanders only a degree less so. The Canadians were perhaps a little more restrained, but not the Scottish Canadians or the French Canadian units; and the South Africans were also distinctive, to put it mildly.

During the past 30 years this sense of national identity—and it is the same sense as we had in the old Empire—has indubitably grown in Scotland. I can remember a Unionist Conservative Conference in Glasgow some 25 years ago which passed a resolution claiming home rule for Scotland. It was the duty of Mr. James Stewart to report this to Mr. Winston Churchill, who was to address the Party faithful in the evening. The great man sat silent for a moment and then growled,"Enemy ships in the Firth of Forth". About the same time the Labour Party in Scotland passed a similar resolution, and from then on we have watched the growth of the Scottish National Party, led by some single-minded and very fluent persons who have worked on the emotions of the people of Scotland.

There is one thing that is somewhat lacking in the Scottish National Party. They are rather deficient of scruples, and I say this advisedly. There are many instances of that, and the one which landed on my doorstep last Sunday is a very good one. I found a pamphlet from them, and among other things in it there was a picture of a really nice old lady with the caption," It's her oil". Then, alongside it was the question: Why do 5,000 people in Scotland die each year of hypothermia? The true number of people who died of hypothermia, as the Secretary of State for Scotland has pointed out, was 9 last year, and the year before it was 12. The concrete results of such propaganda were seen at the last General Election, when the SNP returned 11 Members to Westminster. The betting in Scotland at present is that at the next General Election the number will be near to 50, representing an overall majority of the Scottish nation—and that is going to be quite a disruption down that way.

All of them will be committed to their ultimate objective. They are very strong on this; and to spare your Lordships' time I should like to relate succinctly what is their ultimate objective. I quote Mr. Reid, speaking for the Scottish Nationalists in another place on the 19th January last, at column 1043: Our ultimate objective", said the Member for Clackmannan and East Stirlingshire, is the restoral of national sovereignty to the people of Scotland and the withdrawal of all Scots Members from this House". True, he went on to reaffirm: But we are a gradualist party". My Lords, the Scottish Nationalists can afford to be a gradualist Party. Time is on their side. The fruit is falling into their laps; and the longer some form of effective Assembly is denied to Scotland the stronger they become. Those who at Westminster prevent peaceful devolution will be responsible eventually for violent revolution.

At the present time it is clear that a substantial majority of the votersin Scotland want some form of Assembly—and they want it passionately. It is also true to say that a good majority of the voters in Scotland do not want the break-up of the United Kingdom; and from this we can deduce that a majority of the voters in Scotland will welcome a scheme of devolution constructed in such a way that, while giving the maximum possible power to the Assembly, it establishes it firmly in the United Kingdom and entrenches absolutely in Westminster such matters as defence and foreign affairs. I will not go into how this could be accomplished—many people have been putting forward their ideas, and there is an infinite number coming on later—but there is one safeguard which I think must be built in to whatever is decided; I think it is an absolutely essential safeguard against Scotland going independent in the foreseeable future.

Whatever scheme is adopted, the election of members to the Assembly must be by some form of proportional representation. Nothing else will so certainly ensure that the views of moderate people are heard and acted upon. I am quite convinced that if the fate of Scotland is fairly in the hands of the Scots themselves, the present movement towards independence will be frustrated, probably for ever; but this will be so only if that voice of moderation can be properly expressed in action. I trust that the noble Lord, Lord Crowther-Hunt, will be able to persuade his colleagues to have second thoughts on this point.

My Lords, is it not absurd that when the majority of Members in another place approve of some form of devolution, and I suspect a majority in this House, too, we cannot work out an agreed scheme and get a Bill passed before the next General Election? If we do not do it, then all three Parties in Scotland will be caught with their trousers down, and the state of the Union will be in real jeopardy. During recent years your Lordships have laboured with a deluge of legislation, but the passing of many good laws is not enough when the people have strong, permanent instincts and distinctive marks of character. In such a case, the unique situation and history of the country requires not only that these laws should be good but also that they should derive from a congenial and native source; and besides being good laws they should be their own laws—and that, my Lords, is more or less what Mr. Gladstone said in 1886.

6.49 p.m.

The Earl of PERTH

My Lords, for me this is a very great occasion, for we are debating today not whether there should be an Assembly of Scotland but what should be its powers and what form it should take. I have thought how best I could contribute to this debate, and, greatly daring, I am going to try to outline what I think should be the form, the composition and the powers of our Assembly. I am doing this rather than commenting on the detailed parts of the White Paper; and I am encouraged to do so because I find that many of the things I am going to touch on—and I am not going to talk for too long—arematters on which other noble Lords have spoken, and spoken better than I shall.

The first thing I want to say is that I am totally against independence for Scotland, against the breaking up of the United Kingdom. I cannot follow the Scottish Nationalist Party down that road. Yet, like many other a Scot, I feel that we owe them a great debt of gratitude because—let us be honest about it!—but for the rise of the Scottish Nationalist Party, but for their success, I very much doubt whether we should be having this debate today about a Scottish Assembly. Let me put in one sentence what I want for the Assembly. It is that the people in Scotland should run their own show under the umbrella of the United Kingdom Parliament. I find that many of my Scottish friends are nervous at the prospect of this. I say to them: "Trust your own people!" I am not afraid that because many of the townsfolk or people of the country have voted for the Scottish Nationalists they really want to go down that path. I would agree with my noble friend Lord Balerno that if we get it right and if we are able to run our own show, the demand for independence will disappear. We all want to run our own show and get away from Whitehall.

My Lords, what is our own show? First of all, I would agree that it is all those matters which are listed in the White Paper for the Assembly to have to cover. With many other noble Lords, I think that the Conservatives made a great mistake in setting up local government before they established the Assembly. Here I differ from what is suggested in the White Paper; namely, we should go slow on this matter and let things take their course. The noble Early, Lord Minto, in a really splendidly informed and admirable maiden speech, pointed out to us the troubles of the regions. I would say that almost the first task for the Assembly should be a review of local government. If I were asked what should be the answer, quite simply it is to abolish the regions. My reason is a simple one: that now we will have an Assembly in Scotland, easy of approach. That is enough in a country of 5 million people.

Secondly—and here I want to go a good deal further than what is in the White Paper—I want us to run our own show in the economic field so that no longer will the talented young Scot feel that he has got to go South to earn his living to improve his prospects. I feel that we should be given the chance to reverse this trend which has lasted through the centuries. I have said to your Lordships again and again over the last five years that this is one of the causes of deep discontent.

I have given examples; and I will give one or two more examples today. What is the most important thing for a country? It is transport. Look at the A9. That is the very backbone of Scotland. It should be a wide, straight and strong road. It is, in fact, a narrow and twisting one. We must have a thing like that put right. Or let us think of air transport. Let us think of Turnhouse. Twice last week I had to find my way from Edinburgh to Glasgow to get here at all. It is really a disgrace. I know that it is going to be put right; but only after 15 or 20 years of trying and trying to get the sort of thing we want. I pass the town of Cupar about once a month. I see, stark and derelict, what was once the great sugar factory there. I recall why it is now empty—or almost empty; for they say that some sort of trading estate is there but I have never seen anything in the way of trading going on. It is empty because the British Sugar Corporation wanted to make more profit in the English factories, they wanted to make more profit for the English farmers; and so they closed it. More important, let us look at the question of steel. We are still undecided as to whether we should have a real steel complex on the great, deep waters of the Clyde. This debate has been going on for years. Surely we must be allowed to do that.

My Lords, I have given enough examples. What should we have as a practical step? I am quite clear. Here I agree very much with the noble Lord, Lord Hughes, that we must have an expanded Scottish Development Agency coming under the Assembly and not, I repeat "not", under the Secretary of State for Scotland in Whitehall. If we drag our feet on this responsibility for the Assembly, then the forces of independence are going to gather strength in Scotland and what we do not want to happen will, in fact, happen. Your Lordships may ask: "Where is the money coming from for all this?" The answer, very simply, is that the first part of it will be the block grant suggested in the White Paper. That will take care of most of the things listed today as the responsibility of the Assembly. I recognise that up to now in the block grant we have had more than our fair share. There are good and proper reasons for that. I hope that Parliament will continue to be generous to us; but, if they are not, we must tighten our belts. And we can do it.

My Lords, how are we to finance the industrial responsibilities that I have suggested that we must have as part of the whole? I am quite clear what the answer should be. It is that we should have a share of North Sea oil. Other speakers, particularly the noble Lord, Lord Mackie of Benshie, and, I think, the noble Lord, Lord Home of the Hirsel, have advocated a similar course. I am not going to argue whether it should be Scottish oil or English oil; about how much is ours and how much is not ours; and where the boundaries lie.

I am going to argue for it on quite different grounds. They are that North Sea oil at the moment has benefited the North-East part of Scotland, but it has damaged certain other parts of Scotland. It has a limited life. Some say 25 years and that 25 years is a long time. But it is not. Any one of your Lordships who is under 50 years of age will be seeing the time when the problem will be what shall we do with the derelict areas on the North Sea coast now that Scottish oil has come to an end? It will be the same sort of problem as arose on the Clyde, in Glasgow, with the great shipbuilding industry and heavy engineering coming to an end; or, if you want to go back earlier, even the problem of the clearances. I am sure that we should be granted a sum of money—I do not want to be too greedy, so let us say £100 million a year—whose only purpose is to start today to build up the infrastructure which will be necessary in 25 years' time. That money should go to the Scottish Development Agency, and if our friends in Parliament were nervous that the money might be misused, it would be simple for them to insist that that was the way it had to be channelled so it could not be used for social services, or otherwise misused, if I may put it that way.

I have outlined what should be the functions of the Assembly as I see it and where the money is to come from. What of its composition? We are told in the White Paper that it will have about 140 members. I am sure that that is a reasonable figure. But what is important is: how should its members be chosen? I believe—and I am glad to hear that many others also believe—that a form of proportional representation might be the right answer. But as I am not sure about this, the right course to take is to have a Speaker's Conference, an all-Party body, to decide what is best, not on a Party basis but to make sure that we get this right. I am sure we do not want to see a mirror of the Parliament in the United Kingdom with the same constituencies, for the question would be: should somebody be a Member of Parliament or a Member of the Assembly? A different form of grouping should he tapped. There is a small addition to this, that is, the indirect elections. There should be a few members who are nominated by Scottish bodies, the Churches, the unions and the universities. I could go on with the list, but your Lordships can think of them. There are suggestions in the White Paper that there should be some people from the outside as assistants of the Assembly. It would be much better if there were independent people in from the start.

Many of your Lordships, rightly, have drawn attention to the fact that we are told to think in terms of a Chief Executive and assistants to the Chief Executive. I need not go over that ground in too much detail. I agree very much with those who say that we should call him Chief Minister or First Minister; let him have a Cabinet and have Ministers in his Cabinet. In a sense this is a detail, but it is an important one. If we have an Assembly which is weak in practice or in appearance, it is the recipe for strife and struggle. This is in a sense the fundamental weakness of the White Paper. It is frightened and nervous of what may come in the way of something new to challenge the existing position of Parliament. Robert Burns had, as so often, the right description of what the White Paper is. He said it is a, Wee sleek it, cowrin, tim'rous beastie". One other point which the noble Lord, Lord Kilbrandon, made and on which I agree with him, is that if we are to have a worthwhile Scottish Assembly we should not be as strong in our representation in the South.

There is my one-man report for the Assembly. It seeks to set up a Scottish Assembly with the opportunity to run its own "show", but I hope your Lordships will understand that I say this with no hostility to the English. Mr. Heath, in another place, made a speech which, if your Lordships have not read it, I commend to your attention. He analysed better than I have seen anywhere else the cause and reason for the rise of this demand for Scotland to have its own "show". He pointed out, as the noble Lord, Lord Balerno, said, that we must form this Assembly quickly, otherwise the Union will be in danger.

I have tried to show what I think is the right course for us to follow. I believe in running our own affairs. We will make mistakes, but with the help—I am sure it will be forthcoming—of the English and the Welsh and those of Northern Ireland, we can and will build a fairer and happier land. We will stand on our own feet and there will be a Scotland of which we once again can be proud, and in the doing Great Britain will be the richer.

7.7 p.m.

Lord FORBES

My Lords, I join with other noble Lords in congratulating the noble Earl, Lord Minto, on his excellent maiden speech. He spoke with tremendous authority on local government. Devolution is a very wide subject and I want to confine my few remarks to devolution as it affects Scotland. There is no doubt that for a long time there has been a feeling among Scots that not only is the power centre of Whitehall remote from Scotland, but also between the two the quagmire of bureaucracy is massive and hazardous. Furthermore, there is the feeling that the ears of those in Whitehall are tuned in to the overcrowded South-East of England and the Midlands of England, and that the voice from Scotland is barely heard.

We have heard that improvements have been made to the system of government in Scotland. The noble Lord the Leader of the House made this point; but what he failed to say was that practically all these improvements to the administration in Scotland were made by Tory Administrations. It is ironic that one of the troubles is that few Scots really know what the Scottish Office does for them. This must be a matter for better public relations within Scotland. Then there is another problem which is only known to those who have served at the Scottish Office. It is that whenever anything goes wrong Scottish Ministers usually get the blame from the Scots. When things go right, Scottish Ministers should get the credit for it, but so often a departmental Minister in Whitehall takes the credit for it. This has given a bad image to the Scottish Office.

In addition to the governmental problem, the Scots feel remote from the heart of business decision-making in London. The number of big firms in Scotland which have their headquarters in London is not readily appreciated. It is against this background of remoteness from decision-making, lack of understanding of what the Scottish Office does, coupled with the failure of successive Governments to face realities, that Scottish nationalism has reared its ugly head. From that moment the future unity of the United Kingdom could not be taken for grantee. As a result, the major political Parties in recent times, fearing a loss of votes, brought forward the idea of devolution and the possibility of an Assembly. In doing so, they offered to the Scottish Nationalists appeasement. Luckily, I believe that more and more people in Scotland are now beginning to realise that an Assembly should be viewed with caution. I believe that the merits of the proposed Assembly are far from clear, while the possible pitfalls are legion. Scots arc jealous of their heritage and they are proud of being Scots, but they are by tradition outward looking. Their influence has been felt all over the world, and it is not in their nature to be inward looking. At heart, Scots want to play their part in a prosperous United Kingdom.

I am not going to argue whether or not an Assembly might be right in the future, but I want to make it quite clear that Scotland cannot take an Assembly just now. The reasons are, I think, cogent. The reorganisation of local government has only just been completed and the repercussions of this massive upheaval are still to be felt. Local government simply must be given time to settle down; otherwise any new form of Government could be built only alongside the disarray of existing local government.

Then there is the question of cost. Let us not forget that local government reorganisation cost far more than was anticipated, and any form of Assembly now must add to the appalling cost of Government. In addition, what about the cost of the proposed 2,500 to 3,000 civil servants required for the Scottish Assembly? They will be added to the existing bureaucratic quagmire just at a time when Scotland wants to be less engulfed in bureaucracy and not pushed further into the mire. In this connection, I was very encouraged to see it reported in the Press that the Government are considering cutting down the numbers in the Civil Service which, during recent years, has "growed" like Topsy. Indeed, if this increase were allowed to go on we would soon have far too many people concerned with Government and far too few left to be governed. In any case, how can the Government say with one breath that they are going to cut down the Civil Service and in the next breath advocate more civil servants for an Assembly?

Last but not least, my Lords, surely the Government and the people of this country should keep their sights on the fight against inflation until inflation, which affects all of us so vitally, is really conquered. Surely the message which should be loud and clear is this. Any hasty legislation which includes the Scottish Assembly must be wrong. Irrespective of this, if an Assembly should be considered at a future date many of the present proposals would have to be re-thought. For instance, the proposed electoral system would be another nail in the coffin of rural interests in Scotland, since the Assembly would be dominated by members from the industrial Strath clyde Region. There is the proposal which has been made that forestry should be devolved to the Assembly although agriculture will remain the responsibility of Central Government. Surely this will be the death blow to the recent encouragement which was given for integrated land use for forestry and agriculture.

These are just two random and diverse objections; but there are plenty more. All objections would have to be very carefully considered. Possibly even more important would be the necessity to ensure that the composition and functions of the Assembly should be agreed by the major political Parties, for it would be a disaster if the composition and functions of the new Assembly ever became a political football. It is right that progress in the form of decentralisation of Government should be encouraged, but appeasement of Nationalist passions must be discouraged. We must do what we know to be right and not ride on the tide of nationalism. Our aim today should be to realise that we are one people—not "them and us"—who are proud of our national heritage and have a common purpose to benefit all by making a prosperous United Kingdom within the European Economic Community.

7.16 p.m.

The DEPUTY PRINCIPAL CHAIRMAN of COMMITTEES (Baroness Tweedsmuir of Belhelvie)

My Lords, I venture to speak in this important and very difficult debate as a Scot living in Scotland and because I did have the luck to serve on what was called the Constitutional Committee under my noble friend Lord Home. We reported in 1970 and many things have changed since then. This is why I have come to change my views to some extent since I signed that majority report. I believe that my noble friend also has to some extent changed his views. I find myself very much more in accord with the quite brilliant speech made by my noble and learned friend Lord Hailsham of Saint Marylebone, because I think that one of the most important things we have to do in a debate of this kind is to try to get the widest possible consensus. I was very glad that the noble Lord the Leader of the House used that exact term. I felt that he was perhaps open to the recasting of some of the proposals now before us.

Before commenting on the White Paper I should like to add my congratulations to the noble Earl, Lord Minto, on what, if I may say so, was a most impressive maiden speech made from personal experience of the problems of local government reform. Having been involved in the early stages of that reform at the Scottish Office, I can only say I regret that we did not foresee the difficulties he has described to us so graphically; but I am glad that it will be the Scottish Assembly which will decide on the future shape of the structure and no doubt the finance, of local government in the North.

My noble friend Lord Home mentioned a referendum. When I spoke on the referendum debate concerning the European Community, I am on record as saying that, if we had a referendum on whether or not to join for ever the European Community, it would be very difficult to resist the call for a referendum on a matter of great constitutional concern to the United Kingdom. I believe that the Government might well have to consider such a course, but the question should be quite simple. Whichever way its was put, it would be something along the lines of: do you want to be separated from the United Kingdom or to be quite independent, or would you rather have a directly-elected Assembly in Scotland? One cannot go into the procedures and powers of an Assembly in a question like that, and I do not advocate a referendum just because I hope the answer will be one which accords with my own view; but I think that, from all the evidence gathered so far, it appears that the majority of people in Scotland do not want to be entirely independent from the United Kingdom. My noble friend Lord Balerno told us clearly what are the ultimate aims of the Scottish National Party.

I could not, I am afraid, disagree more with my noble friend Lord Forbes who said that we should delay the setting up of an Assembly. I believe that there is a deep disillusion in Scotland—I regret to say with the two major Parties who have had the opportunity of governing this country in the last few years that any scheme for devolution or for an Assembly in Scotland will just be put into another Departmental pigeon-hole. I believe it is absolutely essential for us to do something now, because if we do not many people who are nationalists in the sense that they are Scots, but who are not members of the Scottish National Party, will use the SNP as a political lever to get something done, without realising the consequences that that would entail.

If we are looking for a consensus, think it true to say that the majority in both Houses of Parliament and in Scotland now want us to remain within the United Kingdom. I would say that the majority in another place and in this House want a measure of devolution. I would say that a smaller margin would now like to have a directly-elected Assembly. So we are narrowing down the measures of agreement. When one considers that Scotland has its own system of law, its national Church, its own system of education, it seems almost peculiar that we do not have our own Parliamentary Assembly, and I should have thought that that would be so much more efficient.

I had the privilege of serving in the Scottish Office, and not all Members of your Lordships' House may know that Dover House in Whitehall is but a small office for the Scottish civil servants who, of course, are all at St. Andrew's House in Edinburgh. When Scottish legislation or Scottish matters come before the Houses of Parliament, these civil servants have to travel up and down and they are taken away from their Departments in St. Andrew's House. Some are not very good travellers by overnight sleeper, and some are often delayed by fog or other inconvenience. The result is that their own work in St. Andrew's House is neglected, through no fault of their own, and I do not call that an efficient form of government. I should have thought that the English Members in another place would be only too glad to think that they did not need to have the possibility of time being taken from them in order to debate Scottish matters at length upon the Floor of the House.

When my noble friend Lord Home and several other Members of this House—at various stages, we all seem to have arrived together—discussed this matter of Scotland's constitutional reform, we tried very had to tie the legislative function of a directly-elected Assembly, which we recommended, into the Westminster system. But, in 1976, I do not now believe that this system is possible. I now think that the powers that have to be devolved to a Scottish Assembly must be very clear and must be completely devolved, without any veto on behalf of either the Secretary of State or the Westminster Parliament.

I also feel that paragraph 58, which has been referred to by several noble Lords, is really a great mistake. It combines the veto on vires and the veto on the political acceptability of legislation put forward in the Assembly. I have spoken about the powers. On the question of vires, I can only defer to the noble and learned Lord, Lord Kilbrandon, who made it very clear to us how it is very much better that the courts should interpret the vires of proposed legislation, and that this should not be left to the law officers who, I submit, would be put in an impossible position.

On the matters that are suggested to be devolved, I would agree with the list so far as it goes, but I intended to refer to paragraph 131 which was dealt with by the noble Lord, Lord Hughes. I cannot understand why the subject of rents in Scotland, which is such an emotive political question, should be kept in the United Kingdom Parliament. This is exactly the kind of thing which ought to be kept in a Scottish Assembly. I would also agree with a fellow Member from Aberdeenshire that the time has come when any Scottish Assembly should have a very large section of the industrial powers to itself. I do not see why these should be left to the United Kingdom. What matters in Scotland are the economic power, the power to attract industry and the power to be there to give advice so that people do not have to go all the time to London.

I suppose that one should not comment too much on this matter which has to do with another place, but having been a Member of that place I feel strongly that one cannot hold out on having 71 Members of Parliament. If we really are to devolve these powers completely to a Scottish Assembly, then the least we can do is to accept the recommendation in the Kilbrandon Report that the number of 71 should be reduced to 57, on the basis of comparability. I am sure that that would be much the fairest to the English Members of the United Kingdom Parliament.

I should now like to say something briefly about the method of election. I cannot understand why the Government have not accepted the recommendation of the Kilbrandon Royal Commission that the system of election should be by proportional representation. When we were examining all these matters in the Constitutional Committee, one of the things which we felt very strongly was that it is so important to give an opportunity to those persons in Scotland who would be prepared to serve in a Scottish Assembly but who, because of their life and work in Scotland, might be unable to go South to Westminster. It seems to me that if you leave the present system of voting you will only have a perpetual Party system. But we want Scots to be able to serve Scotland, and we have very many good men and women who would do it and who could do it under a proportional representation system.

There is another consideration. I understand that we are very shortly to have a Green Paper or a White Paper on direct elections to the European Parliament. I understand it is proposed that in the first election each of the nine Member-States will be able to use its own voting procedure. But it is proposed in the Patijn Convention, which will be the one before us, that in the next election there should be a universal procedure. It is impossible to expect that the other eight Members of the Nine will accept our system of voting in the country. Six of them already have some kind of list voting. There is, of course, PR in Ulster and in Eire, and I think we should do very much better—when we are undertaking a new venture, anyway—to try out this system, because that would be advantageous in itself and would prepare us for joining the European Parliament in direct elections.

I should like to say something briefly on finance. I join those who say that there should be some proportion of oil revenues allotted to a Scottish Assembly to spend as it so wished. Surely it is not beyond the wit of man to devise a way of allocating some portion of the oil royalties. I should have thought we could consider questions such as motor taxation, petrol duties and sales tax, but certainly not a surcharge on the rates. As one living in an area which has had a rise of over 100 per cent. in local rates, that is the very last thing I should like to see.

I suggest that we are in all this difficulty because most people, except the Liberal Party, who have been consistent about it, are uneasy about formal federation. But surely we shall have a written Constitution laid down by Act of Parliament, and I hope that we shall have clearly devolved and clearly defined powers, with appeal to the courts. We shall not be very far off a system of federation, and, speaking for myself, I am not at all so nervous about the federal system as many people seem to be. But whatever form is finally devised, I am sure it is time we got on with the job. We should surely accord my fellow countrymen and countrywomen the sagacity, the imagination and the capacity for work for which they are rightly known throughout the world. I believe that they have the character to run their own affairs as, if I may say so, they have so often run other people's affairs for them.

7.31 p.m.

Lord HALE

My Lords, I did not put down my name to speak as Chesterton's" voice of the people of England and we have not spoken yet". I was foolish enough to put down my name as one who has always greatly admired the Scots, who has a considerable passion for their history, who regards the contribution that they have made to English politics in the eighteenth century, and more particularly to English law and justice, as very outstanding and who thinks it is necessary to say that since that time these five million people have exercised both in this country and throughout the world, by merit, a wholly disproportionate influence upon the affairs of government and the making of history.

The position of Scotland at the Union has been described by Sir Walter Scott in his introduction to the Legend of Montrose, yet at that time more works of learning on politics and economics came from Scotland than from the whole of the rest of the United Kingdom. David Hume was a genius whose reputation probably suffered from the multiplicity of his talents and perhaps a slight suspicion of religious unorthodoxy but he was a great genius. One of his friends was the young man from Kirkcaldy who, under the patronage of the Duke of Buccleuch, travelled in France, mixed with the very over-rated Philosophes and the one outstanding figure of the physiocrats and produced a work on economics which every economic writer on the history of economics describes as a literary watershed in economic thinking.

The judiciary of England had become utterly corrupt during the events of the Civil War and the latter years of James II. It was making a recovery when a little lad from Scotland of the noble family of Stormont—undoubtedly impecunious and, it is said, very definitely Jacobite—left Edinburgh on a pony for a three week journey to London with permission to sell the pony at the end of his journey to pay his fees. He became the outstanding Lord Chief Justice of England of all time. He brought with him another of the virtues of the Scots. This was integrity, and integrity of a type that the law had not seen before. One had the scene unparalleled in all history of the future noble Earl, whose brother was known to be the leading adviser to the Jacobites in France, prosecuting, under the vilest of our Kings, with absolute integrity the captured of the '45. Even Lovatt, who was a rather attractive villain said of him on the eve of his execution. "That young man will go far as long as he does not go too far North".

Mansfield's 32 years as Lord Chief Justice have survived all the tests of history. From that time we began to witness the jokes of Sam Johnson about Boswell regularly coming true. When you cross the Border you will have a great part to play there, but there is no return. "The Scots were Anglicised. The sage of Ecclefechan became the sage of Chelsea, and John Stuart Mill is the English economist. Bishop Burnett is English, too, although he was the son of a member of the Court of Session. Then there is Scot's contribution to history and political history. Macaulay was born in Leicestershire. He was a Member for Edinburgh, but I fancy that he spent very little time in Scotland, but, of course, he was Macaulay of the Isles. He was a man of outstanding genius who shone on a long list of Scottish historians—. Hulme, Burnett, Mackintosh and so on, but this is too much of going hack into history. All I say is that the result was that from 1793 until 1835 no lawyer born South of Newcastle-upon-Tyne ever held the Seals. Erskine, the young midshipman, became the outstanding advocate of England, perhaps making his best speech in his first great case. It is a curious feature that his brother Harry was the recognised head of the Scots Bar. Many Scots said that he was an equally great advocate, although in a smaller field. Finally, I face the difficulty that if I do not mention a Campbell I may find myself in the partisanship that followed Inverlochy and Glencoe. It is true that Jock Campbell was the son of a manse and an overpopulated manse. He went to the English Bar with the nine year old son of his landlady as his clerk and eked out his income by contributions to the Morning Chronicle. He remained quite poor until he was about 40. At 60 he became Lord Chancellor of Ireland and, having lost that place by change of political government, commenced the writing of The Lives of the Chancellors. At the age of 70 he became Lord Chief Justice of England and when he resigned from that position he commenced to write the lives of the Chief Justices. At the age of 80 he became Lord Chancellor. No one else has ever achieved anything like that success, and from so small a beginning.

So, my Lords, I believe in the right of the Scots, if they think it fit, to as large a measure of self-government as they desire, and I have constantly so expressed myself. I was glad that the noble Lord, Lord Rhodes, said one word for England, because if there are now two nations in England, as Disraeli said in Sybil, the line of demarcation is much nearer the Trent than the Tweed, and the grievance of government in London is one. We have felt that for a long time in Lancashire.

I had great sympathy with the noble Lord, Lord Forbes, in the speech he made. I found myself very much in agreement and I had hoped to say something on what was said by the noble Earl, Lord Minto, which I was surprised to hear was a maiden speech. I look at this White Paper and think it was intended to be drawn on generous lines, but I cannot see how it would work. The noble Baroness, Lady Tweedsmuir, went further than I thought the noble Lord, Lord Home of the Hirsel, had been prepared to go. I thought she was rapidly advancing towards a dissolution of partnership between the two countries, and reassured as I am by the noble Lord, Lord Home of the Hirsel, and by the fact that the noble Baroness has just nodded her head, what I want to know is what happens once we have started. How does one apply the brake? Virtually, one cannot go back and the pressure at any time of dissatisfaction or economic disorder will be that we want more, and the voice of the people of England will have to be heard.

When the noble Baroness was speaking about a plebiscite in Scotland I wondered whether they wanted to maintain a close union and whether there was to be a plebiscite in England. I do not think the people of England are concerned at the moment. I accept the opinion of the noble Lord, Lord Rhodes, as to the general thinking in the North, but I do not think that the people of England are gravely opposed to this. But there is an annual problem of the amount of the block grant and of the supplementary estimates, and so on. The noble Baroness was carrying on the tradition of a Scots family which includes a Governor-General of Canada who was one of our very great writers, and she was speaking as the chairman of the Select Committee of the EEC. Of course, it is always the wrong moment for progress in politics, as we have heard for many years. But just at this moment when we are trying to overtake the tremendous problem of endeavouring to get a law for Great Britain in accordance with the law of Brussels, we are talking of constituting a devoluted Parliament which will have substantial powers of legislation, which will maintain the separation of the legal professions and the separation of laws. I am concerned about the problems. From the point of view of the new Scots Parliament, I believe that they must have, and will insist on having, their own representation at Brussels, their own right to discuss their own special laws as amended by them from time to time; their own right to consider how far the proposals of secondary legislation from Brussels accord with their interest.

The noble Lord, Lord Forbes, mentioned afforestation. I am happy to say that, although the word "afforestation" does not appear in the Treaty of Rome, legislation is proceeding, apparently by a large measure of consent, on afforestation, and highly intelligent recommendations are being put forward to try to take into account the essential new knowledge about the ecology of afforestation. Indeed, the proposals that come from Brussels are always highly intelligent and highly constructive, but they involve a lot of consideration and a lot of delay and the ultimate uncertainty of a decision by a tribunal which has no rule of precedent. That is partly, of course, because they have no precedents. I read through the White Paper last night realising that it was generous. I believe that the noble Lord, Lord Forbes, and I are almost alone on this. I think it was agreed by everybody in the Commons debate that we have reached the point of no return. There is virtually no possibility of going back completely on this and trying to devise something wholly new. There must be some measure of self-government for Scotland acceptable to the Scots and, in those circumstances, it is incumbent upon us, if we have good sense, to go as far as we possibly can on the road to generosity towards a country which has special problems.

My Lords, some of the glory has departed. If the fiery totem were to be passed round the Clan today it would have to be passed down Rosendale Road, S.E.21 or Eaton Square or PO Box 505 in Montana. Indeed the Leader of the Menzies Clan is in Australia, where they probably call it "Menzies", with the "Z" sound. The beautiful old city of Aberdeen is beginning to look more and more like Beirut and the Scots may not continue to live in such numbers in Scotland as the Arabs begin to take over part of the country. I hope that does not happen. I hope we shall be able to maintain the connection. I hope that this great country of ours will get some of its former greatness back and some of its former unity. There is not much unity in Northern Ireland. Already we are facing problems of immense complexity; I am afraid of adding to them at this moment.

7.50 p.m.

The Marquess of LOTHIAN

My Lords, the very large number of speakers in the debate today illustrates the great importance of the subject we are discuss ing, and impels me, in view of the long list of speakers to come, to be quite brief this evening. The debate has also shown that the question of devolution—which I pronounce to rhyme with "evolution" but which I believe the true Scot pronounces to rhyme with "revolution" is such a complex and detailed subject that one cannot possibly hope to cover anything like the whole subject in one short speech. But there are one or two, to me, fundamental matters which have already been referred to but which I should like to re-emphasise.

It is something for which we should all be thankful that in general—and there are some who are not in agreement with this— all the Parties, except one, recognise the need for an Assembly in Scotland. Personally, I am convinced that it is the one essential step for public opinion in Scotland. Up there, feeling for a greater say and participation in the nation's own affairs is now very deep-rooted, and I think is a permanent feature of Scottish thought. I am glad that the Government in their White Paper recognise this fact. At the same time, my own belief—which I know is shared by previous speakers today and, indeed, the opinion polls have tended to confirm this—is that, by and large, the Scottish people would shrink for a total break with and separation from the United Kingdom. So in this respect, I urge the Government to stick to their guns.

Having said that, I would suggest that there are one or two essentials in the setting up of an Assembly which must be covered, and which have already been referred to. The first of these concerns the powers of the Assembly. It is obvious from the debate today that there has been, still is, and indeed will be, much discussion about what precisely should be devolved to a new Assembly. Obviously all purely Scottish legislation is one of those things. I support those of my colleagues who have already suggested that, whatever is decided in the matter of devolved powers, they should be absolute devolved powers, totally devolved powers; and by this I mean that there should be no reserved powers, either at Westminster or for the Secretary of State. I know it is argued that reserve powers would be seldom, if ever, used. Indeed, that would be a convention rather on the lines of what has been happening in Northern Ireland until recently. My own opinion on this is that their very existence would threaten the full and serious operation of the Assembly, and would make it in some degree rather an unreal body, added to which, one would not get men and women of quality to serve in the Assembly if they felt that anything they decided could possibly be overruled.

I appreciate that this may sometimes give rise to some awkwardness politically. There will obviously be conflicts of opinion between Edinburgh and Westminster, but I think this is a fair and democratic price to pay. It would avoid the charge that only lip-service is being paid to the idea of devolution. I accept that this may be—I think my noble friend Lady Tweedsmuir of Belhelvie felt the same—somewhat akin to federalism; but, like her, I can say that this is something which does not disturb me unduly for I cannot really see an Assembly functioning properly unless it satisfies Scottish opinion, and unless it has full authority over its own decisions. Nor can I see that this in any way threatens the Union.

To my mind, the second fundamental point—and many speakers have spoken about this—concerns the type of election to the Assembly. Obviously the Assembly must be directly elected, and I think it should be by some form of proportional representation, not so much because of the fear that it might be dominated by one political Party, but more because of the fear that it might be dominated by one particular area or region in Scotland. This would be very deeply resented in other parts of Scotland. I would urge the Government to have another thought about this and to take its effect more into account. Obviously further consideration will have to be given to the system of election and, indeed, to the electoral divisions or constituencies, or whatever they will be called, so that a fair and balanced spread of representation throughout Scotland is achieved.

My noble friend Lord Minto, in an interesting and remarkable maiden speech, from his authority as a member of a regional council gave us his views on the existing pattern of local government. I would agree with him that this is something which the Assembly will have to look at. I also agree with him that the new system of local government needs time to settle down. But, of course, if the Assembly is not going to be set up for another two years it would be some time before it would be in a position to look at the pattern of local government in Scotland, and decide what to do. But certainly it will be one of the major subjects that the Assembly should tackle.

I would raise one further point. My noble friend Lady Tweedsmuir touched on it in one aspect as, indeed, did the noble Lord, Lord Hale. I think it may not be strictly relevant to the White Paper, but it comes under the heading, Our Changing Democracy; that is, the relationship between Scotland and the European Economic Communities. One hopes and presumes that in the years to come, the United Kingdom will become increasingly and significantly involved in Europe to our own mutual advantage. That is why this country voted to remain in the Community; and I think it is worth reminding ourselves that Scotland also gave a" Yes" vote at that time.

It is very important, I think, that Scottish representation in the new, directly elected European Parliament should be as full as it is possible to get. Obviously, the method of election, the distribution of seats among the Nine, is something which is going to be discussed and talked about in the very near future. I would hope that when the Government here are taking part in these discussions and working out the new electoral system for the European Parliament—and it may be that some form of proportional representation, as my noble friend has suggested, will be essential in this—it is very important to allot a sufficient number of purely Scottish seats within the United Kingdom delegation. I must apologise perhaps for that slight digression, but I think it is part of the overall picture of Scotland, the better and fairer deal which I am perfectly certain noble Lords on all sides of the House, regardless of Party, want to see brought about for Scotland.

8.2 p.m.

Lord BALLANTRAE

My Lords, it is a matter for relief in all quarters that so many of the points one wanted to make have been made already more adequately by other people. I think I have two qualifications to speak: one is as the colonel of the oldest Highland regiment, and the other is as chancellor of the oldest, and coldest, university in Scotland. Fortunately, only the lunatic fringe are talking about bringing Armed Forces under devolved government; but there is something to be said about the universities.

I observe with some trepidation that there are two other chancellors of Scottish universities in your Lordships' Chamber at the moment. I hope I shall not be misrepresenting their views when I say with what relief I read in paragraphs 127 to 129 of the White Paper that universities are not to be devolved. That I know to be the unanimous view of all eight vice-chancellors. There is, as always, an articulate and quite loud disagreement from some people at the universities, some members of staff, some students; and a very strident protest by the Scotsman in an editorial. I think it is not unfair to say that the vast majority of informed and wise opinion in Scottish universities is very relieved to find that universities are to be left undevolved: not that we have any fear that the educational side would dry up, but because we want to remain under the umbrella of the University Grants Committee. We want to be sure that we continue to share in the monies available for research; we want to have no barriers to our learning; we want to continue the long tradition of association with the continental (Dutch, French and German) universities, and with the Association of Commonwealth Universities. To anybody who may say that this could go on even if the universities were devolved, one can only point with sadness to what happened to Trinity College, Dublin, famous before, during and after the days of Mahaffy, which, once it drifted out of the circuit of British universities, alas! has rather gone down in the academic and social scale of universities of the world.

Quickly, I think one can rehearse examples where, if we had had an Assembly in the recent past, certain near disastrous things would have been averted. We have heard Lord Hughes on Strathclyde; and a great friend of mine whom I have known for nearly 50 years, was instrumental in setting up Strathclyde. Your Lordships' House in its wisdom decided to dismember the proposed Strathclyde; but, by a majority of 73 votes, that decision was overturned on a Tory Whip in another place, where there are only 71 Scottish Members. This, I think, remains one of the classic examples of what is essentially a domestic decision to be taken within Scotland, and not out of Scotland by a number of Members, including English Members.

I will not develop any further what has been said about the method of election. I am relieved to hear that, whatever may be one's views on proportional representation for the United Kingdom, almost everybody believes that for Scotland it is the obvious answer to avoid a monolithic Party superiority in that country. One would at least hear the voice of Scotland in many different sounds and from four different Parties. There would be a monumental clishmaclaver, but at least we ought to get a proper hearing of what is felt.

I do not entirely agree with the noble Earl, Lord Perth, about oil. I cannot help pondering what we would have thought had the oil been found South of a line drawn East to West across the Humber and the English had said:" This is English oil". So far as I am concerned, this is the end of any argument about sharing oil revenues beyond what is our natural share of what is coming into the country.

I have very little more to say. I confess I am one of those who only lately realised the true strength of the feeling, the undercurrent of feeling, in Scotland for devolution. I am still not convinced that there is all the hurry for it which Lord Balerno and Lady Tweedsmuir and others would have us think. This is such an important, monumental milestone in our history that we must not let it go past at a gadarene pace. The Gadarene swine finished up with a hell of a splash, and there was no future for them at all thereafter. I think it is important that we should take our time over this. Lord Balerno expressed the fear that we might be caught with our trousers down. He was a mere Gordon Highlander. In my regiment, our phrase was" being caught with your kilt over your head". But however you phrase it, I think we ought to approach this matter carefully and with caution; and while admitting, perhaps with shame, that we have been late in recognising the urgency of it, do not let us be stampeded, because it is urgent, into taking swift and ill-considered decisions which we might later regret.

When I had the honour to serve as one of the four non-Party members on the constitutional committee which the noble Lord, Lord Home, chaired—there are several of us in this Chamber at the moment who were on that committee —Sir Robert Menzies was one of our advisers. He said"You are all daft. I have spent all my career in Australia, that huge island, trying to overcome the drawbacks of having six States, and in this tiny island of yours you are daft if you try to break it up".

Well, we have today, in many memorable speeches heard deployed all the arguments for and against devolution. I thought the speech of the noble and learned Lord, Lord Kilbrandon, went beyond the boundary of an ordinary speech and was a truly great speech, an historic moment. We are convinced now that there must be devolution up to a point, and the point is going to be thrashed out. I share the delight of everybody that it is being done in a good-humoured manner. I brought back from my years in New Zealand a Maori proverb which I have quoted before, and I quote again, which propounds the importance of unity. This Maori proverb runs: The tree that is split is nothing but food for the axe. So whatever solution we adopt, in not too much of a hurry but well thought out, let it be one that will continue the glories of the 270 years, or whatever it is, of our Union and whatever the solution, whether it is distasteful to some of us in some degree or other, let every one of us set to work to ensure that it works.

8.10 p.m.

Lord GLADWYN

My Lords, I propose to make a short contribution (following on the footsteps to some extent of the noble Marquess) from the European point of view. Before doing so, I need hardly say that I am strongly in favour of the grant of some real autonomy—going well beyond the proposals of the present White Paper—to Scotland, for the reasons so well advanced at the beginning of this debate by my noble friend Lord Mackie of Benshie. Here I think I echo what the noble Lord, Lord Ballantrae, said, that, ignored for too long, the nationalist movements in both these countries do reflect real popular emotions, based on history, which in the exceptional economic circumstances of the day, must be sympathetically and intelligently handled if revolutionary situations are not to develop. My Leader, Mr. Thorpe, was criticised the other day for saying just that, but personally I think that it needed saying.

However, I believe—and this is a belief supported by all the polls—that a majority, and quite possibly a large majority, in Scotland, and, I dare say, in Wales, just do not want separation. Whether this fact should be established beyond reasonable doubt by a plebiscite—a solution not ignored by the noble Lord, Lord Home of the Hirsel is a possibility which should not he disregarded. What must be avoided at all costs—and here I dare say I am repeating what a number of noble Lords have said—is the election of an Assembly by means of a "winner takes all" system of voting, which could well result in a minority of, say, 34 per cent. of the electorate, composed of those who wish to obtain total independence, forming a Government pledged to the achievement of that very end. This is quite a conceivable possibility. Whether they know it or not, the Government are therefore confronted by a dilemma: either they plump for what in effect is a toothless Assembly which cannot appease (and cannot be expected to appease) any nationalist agitation and indeed may well increase it, or they must accept proportional representation. I think that the necessity of this choice is now dawning even on many of the most devoted supporters of the present Government. And it now looks, from what has been said in this Chamber today, as if the choice of proportional representation will soon be made by the official Opposition. I certainly hope so. All I can say is that these conversions are greatly welcomed by the Liberal Party, who have suggested this from the start.

If the Government do eventually proceed along the road which leads —and I am talking about Scotland for the moment—to what must be a largely autonomous Scotland, they must obviously do so as part of an effort to convince a majority of the Scottish people that complete independence for Scotland (and indeed complete independence for England) is, in our strange modern world, a deplorable and indeed reactionary idea. For supposing, in the first place, an independent Scotland were to leave the Common Market, even if she controlled in some way the North Sea oil and were able to finance its production—both possibilities, after all, being more than doubtful—she could not, in practice, and for obvious reasons, become, as it were, another Norway; while, if she remains in the Market, even though independent, she will still be linked to England in a customs union guaranteeing complete freedom of trade, of movement of persons and of capital across the Border.

As we know, it is at this point in the argument we all know this because we have had these arguments—that the Scottish Nationalists say: "Ah, but if we were in the Community as a separate nation we should have a representation in the European Parliament at least equal to that proposed for Denmark in the Patijn Plan: in other words, a basic quota of six plus a regressive increase based on population; that is to say, 17 delegates instead of the six we should have if we remained part of the United Kingdom delegation. In any case, it is monstrous that Scotland, with 5 million people, should if it is to be represented as part of the United Kingdom delegation—have only six delegates, while Luxembourg, with under a tenth of Scotland's population, would still have six members too." My Lords, these arguments which, on the face of it and to many people, seem to be reasonable, should be refuted, and I hope that the Government will duly refute them.

Take Luxembourg first. Well, any State which is a separate State must have at least six representatives if it is to take any effective part in the deliberations of the Parliament—and Luxembourg can, after all, not now be abolished as a separate State. Indeed, in its capacity as a separate State it is very useful, for various reasons, to the Community. In the second place, it would really be rather silly to maintain that Scotland's interests might suffer if she had rather fewer delegates to the European Parliament than she might have if she were completely independent—and this is not to say that the numbers proposed for the smaller States may not be perhaps rather exaggerated and might suitably be reduced. I think that it is possible. There are, after all, strong compensating advantages which Scotland would have as a result of continued membership of the United Kingdom. For instance, she might well profit more from strong United Kingdom backing in respect, shall we say, of a Regional Fund than if she had to fight her own corner. It is very likely. To put it more generally, the Scots might often be the tail which, in Strasbourg or elsewhere, wagged the British dog!

Besides—and this is an even more compelling argument you have only got to consider the example of Bavaria. Bavaria is a nation with just as long a history of independent national existence as Scotland. She has only formed part of a union for about the last 100 years or so, and up till 1918 she had even a king of her own. Her traditions and her separate way of life continue. But now, though part of a Federal State, she has very real powers of her own, and nobody in Bavaria believes that she should declare total independence and apply for separate membership of the EEC—sending about 20 delegates, under the Patijn calculation, to the European Parliament, rather than the seven or so she might have as part of the West German delegation. The very idea would be regarded in Munich and I have just been there—as rather crazy. Bavaria, then, could, and should, be quoted as an example for Scotland.

But it is true that Western Germany is a Federal State including other nations with a long tradition of independence, or quasi-independence, such as Württemberg, Hanover, or the Rhein-Pfalz. So if the United Kingdom were ever to become a Federal Republic within the European Community based on the German model, there would presumably have to be a break-up of England into its component parts—which has been referred to already by several speakers—such as Wessex, or East Anglia, or Mercia, and this is what some convinced Federalists regard as a possible and indeed desirable solution. I am a convinced European, but I must say I doubt it. This is not the time to enlarge on the theme (we have not the time to do so anyhow), but I certainly do not believe that there is any conscious, or even subconscious desire on the part of English people to revive the Saxon heptarchy which disappeared over a thousand years ago. In other words, I do not think that England is likely to become the exact equivalent of West Germany, and that could be excluded. Offa has been dead much longer that the last King of Bavaria, and a sort of Mercian Land-tag in Birmingham would not necessarily be a very effective organisation.

Of course, we must have local government, really good local government, whose responsibilities would no doubt become increasingly important, but I suggest that if we are to meet or counter nationalism in the Celtic fringe, we must still have a kind of Union of Scotland, Wales, Northern Ireland and England as a whole, and here I follow the argument advanced so eloquently by the noble and learned Lord, Lord Hailsham of Saint Marylebone. It is true that, to the extent that Westminster agrees, certain additional powers will, as the European Community develops, be transferred to the European Parliament. But there will remain powers which Westminster will, as I see it. continue to exercise; notably, that of forming the Government of the United Kingdom as a whole who will decide on the general policy to be pursued by the entire United Kingdom.

In any event, we can hardly contemplate having, in respect of this country—this point has already been stressed—no less than six administrative bodies; European, national, federal. regional, and so on. If he took this seriously, the citizen would spend his whole life voting, And having just reorganised our own system of local government in England, are we really going to add another layer to the already rather cumbersome administrative structure? I do not believe we shall, but if we do—there would certainly be a case for doing it then—we shall clearly need some Assembly for the regions and to abolish the recently constructed and much criticised tier. This is the obvious conclusion.

I feel that for the next two decades at least, Scottish and Welsh Members will be coming to Westminster and that the Parliament of the United Kingdom, no doubt reformed and streamlined, will continue to exercise a determining influence on events. It will surely be the same in France and even in Italy. Though there may be some concession, so far as France is concerned, to Breton nationalism, it is unlikely that Paris will devolve any very serious powers on the regions, France thus becoming a federal State on the model of the Bundesrepublik. Although nobody knows how Italy will develop, it seems quite unlikely that it will disintegrate.

In other words, although I would not be sorry if the present European nation-States broke up and became a collection of provinces. all forming part of a European federation, it just does not seem to me to be at all likely, even by the end of the century. That is why I believe that the European Policital Union, which I am convinced we shall achieve—perhaps sooner than we think—will be primarily a union of nation-States cooperating in an agreed, novel and binding manner and subject to the democratic influence of a directly-elected European Parliament representing all the popular forces of the Community. By such means, the nation-States—the "cold monsters" as they have been called—will, it is true, not be abolished, but will be humanised and, as it were, tamed.

My Lords, I dwell on these issues because, however misguided my ideas may be on this subject, the issues are surely basic to our present discussions. Unless, indeed, we have a fairly clear idea of where we ultimately want to go and what sort of new political structure, both in the United Kingdom and in Europe, we hope to create, it may be dangerous to go ahead with any scheme to meet some immediate political situation in Wales or Scotland. For this reason I particularly look forward to the forthcoming discussion paper about devolutionary arrangements in England, which I think the Goverment are shortly to issue, to say nothing of the attitude which the Government will take up about the Tindemans Report and as regards direct elections to the European Parliament; for all these questions are directly related to devolution for Scotland and Wales.

8.25 p.m.

The Duke of ATHOLL

My Lords, I rise to speak in this debate in the knowledge that many noble Lords have already made, far more ably than I could, many of the points I wished to make, and therefore I speak only with the purpose of having my position recorded. After so many noble Lords have expressed their views, I do not flatter myself that I can contribute much that is new. However, on a matter such as this, one that will alter the method of government of substantial parts of the United Kingdom in future, it is important that each person's view is recorded, and speaking in this debate is one way of doing this.

Briefly, my position is that I am instinctively against devolution, and there are three reasons for my taking this view. The first and foremost is that it could be the start, albeit a small start, of the break-up of the United Kingdom, something which, in common with every noble Lord who has spoken today, I would hate to see incidentally, I believe that the vast majority of Scottish people would also hate to see it, a point that has frequently been made. Secondly, I do not see why Scotland and Wales should be treated in a different way from the other parts of the United Kingdom. For nearly 270 years we in Scotland have been governed in the same way by the same Governments as England and Wales, and while this has not always been conspicuously successful, I do not think that any Government—at any rate recently—have shown deliberate bias against any geographical part of the Kingdom, nor do I believe that there are many problems so unique to Scotland or Wales that they justify the creation of a special Assembly to deal with them. They may be present to a greater extent on the geographical fringes, but this is a matter of degree, although I recognise that a form of federalism might get over this difficulty. Like my noble friend Lady Tweedsmuir of Belhelvie, I am not instinctively against a form of federalism, for it would seem at least to be fair as far as England and Northern Ireland are concerned as well as Wales and Scotland.

Thirdly, I am convinced that devolution would be a far more expensive exercise than the White Paper make out. I regard the figures in Part VI with deep suspicion. We were told that regionalisation, to use a horrible word, would save money; I think it would be difficult now to find many people who still hold that view. There is also the problem that Scotland would become one of the most over-governed countries in the world, and I support what others have said, namely, that in the event of the Assembly being set up, it is essential to reduce local government in Scotland, by doing away with the regions or by doing away with the districts or by a combination of both of these. This is another reason why at the moment I am instinctively against devolution because I fully recognise that the new set-up of local government in Scotland has not had sufficient time in which to prove itself or otherwise. It has shown that it is expensive, but maybe it will be efficient. I am not convinced it will be, but we cannot judge it as yet.

I recognise, however, that for political reasons it may be necessary to have some sort of devolution. If this is the main reason for it, then this White Paper does not go remotely far enough. One has only to look at paragraph 160 to see an enormous list of subjects which will not be devolved, many of them, such as industrial relations and consumer credit, affect almost everyone and are of great interest to the average Scotsman. Throughout Section D of Part III of the White Paper are sprinkled matters which will not be devolved—I will mention a few because although there are plenty of others the hour is too late to list them all—which I regard as being of particular importance to Scotland and therefore bound to be of special interest to the proposed Assembly. Paragraph 142 excludes the fiscal, regulatory and international aspects of forestry, a subject which the White Paper admits is of special importance to Scotland.

Forestry policy is based largely on fiscal considerations. As the present Administration have succeeded in reducing private planting by more than 50 per cent. in two years, this seems to be something about which the Assembly would have every reason for wishing to take action. Next, consider paragraph133, which is about land. I should have thought that, if one was to have an Assembly, it should have complete control over the land, subject only to considerations of defence. Yet the Community Land legislation is specifically excluded except for supervisory functions. Why? The reasons seem totally unconvincing. Thirdly, firearms legislation is excluded. That is dealt with in paragraph 147. Again, why? Conditions in parts of Scotland are very different from those in much of England. For instance, stalking is an important foreign currency earner and gives substantial employment over great areas. As the firearms regulations stand it is illegal for anyone to carry a guest's rifle.

The Assembly might well wish to make honest men of stalkers and ghillies by correcting this. It is a small example, but it is none the less one which makes those who are keen on devolution—allow me to say again that I am not—feel that this White Paper concedes neither the substance nor even the shadow. My fourth and last example is ports. Why should not powers relating to ports be delegated? What bar is there apart from the present Government's desire to nationalise them? Is there a fear that non-nationalised Scottish ports, freed from the National Dock Labour scheme, might drive England's ports out of business?

I should like to mention a few other points which are touched on in the White Paper. I agree strongly with almost every noble Lord who has spoken that a surcharge on rates would be a fatal system of financing the proposed Assembly. To give it such a power would make industry most reluctant to come to Scotland as it would always fear that rates—which are already high in Scotland—would be made that much higher. I also support everything that has been said about the necessity for some form of proportional representation in the Assembly. I believe that there are strong arguments about which system should be chosen—that is, whether to have the list system which is used in the Republic of Ireland or a form of single transferrable vote—but I am convinced that our present system at Westminster of "first past the post" is not suitable for the Assembly. The reasons for saying so have been so well expressed by the other noble Lords who have touched on this point that I shall not bother to reiterate them.

I also agree with certain other speakers that, when the Assembly set up. the number of Scottish constituencies at Westminster must be reduced. Otherwise England will have justifiable grounds for grousing that Scotland is overrepresented here where much of the legislation may have little Scottish application. In addition, the Assembly in Edinburgh would clearly give rise to extra costs which would have to be financed out of general taxation. It is already felt in some parts of England that it is unjust that the average Member of Parliament for an English constituency represents very nearly 15,000 more people than his Scottish counterpart. If we have an Assembly. I feel that to continue on that basis will be quite indefensible so far as England is concerned. I am trying to be very fair about this.

Finally, if devolution is to appease anyone at all, the nannying role of that sinister devolutionist figure, the Secretary of State, must be reduced. To sum up, I am instinctively against devolution. but if it is politically essential. as it may well be, it must be of a much more thoroughgoing kind than this White Paper visualises.

8.35 p.m.

Lord WHEATLEY

My Lords, I am afraid that I intend to depart from the pattern which the debate has so far taken and that for what I conceive to be a very good reason. The judges of the High Court in Scotland were invited to give their observations on the White Paper with particular reference to those matters in which they had a particular professional interest. These included matters such as the court system and its administration and where responsibility for that should lie. We accepted that invitation and came to a collective judgment and the views which I shall express here this evening are the unanimous views of all the High Court judges in Scotland. I appreciate that normally a Member of your Lordships' House is expected to present his own views rather than to be the representative of those of others but, in these peculiar circumstances, the fact that the views which I am expressing represent the unanimous views of the judges of the High Court in Scotland will carry much more weight than could any personal contribution of my own. However, that very considerably circumscribes the area which I can cover.

Secondly, there is, as your Lordships know, a convention which we in Scotland accept. It is that judges should not become involved in public political controversy. As I know from personal experience on several occasions when a judge has been a member of a Royal Commission or of a departmental Committee of Inquiry, it is not only reasonable but probably right that he should explain publicly the recommendations of the Commission or Committee and the reasons for them. However, when the subject enters the political arena and becomes politically controversial, we assume an elective silence on the political issues and confine ourselves, if we intervene at all, to constitutional or legal questions or views on practical matters affecting the law and its administration, where our views may naturally be expected and sought.

So, when the Scottish High Court judges considered the proposals in the White Paper in the narrow fields to which their attention had been directed, they did not consider those aspects with a political connotation or involvement. However, we sought to collect the views of all the judges on other matters. What we did not attempt to obtain, even had it been possible—which I doubt—were the collective views of the judges on whether or not there should be an Assembly and, if there were, what form it should take and what powers it should have. We confined ourselves to such matters as the law and the system of the courts and their administration on which we felt we were qualified to speak. We also considered the question of vires, to which reference has already been made by a number of noble Lords. Our views in that situation were naturally based on certain assumptions which flow from the proposals in the White Paper. However, I should say that many of those assumptions would be appropriate to any system of devolution within our sovereign State.

Those assumptions are, first, that there will be an Assembly with delegated legislative and executive powers constituted by an Act of the sovereign Parliament. May I say with respect to my noble and learned friend Lord Kilbrandon that I believe we in this country know what that is and know what its powers are and how those powers are exercised for whatever reason. It is the Queen in Parliament. Of course, if there were no Assembly this exercise of ours would be quite academic. It is an Assembly that we are considering, not a federal system, nor separation. If it were either of the latter, different considerations would naturally arise.

Secondly, it is a fundamental principle of the proposals that the sovereignty over the whole of the United Kingdom will remain with the Queen in Parliament. Thirdly, whatever precise scope of devolved powers may be determined, they 'will essentially be limited. Fourthly, according to the proposals in the White Paper, legislation by the Assembly will be subject to Ministerial control on vires and to Government and Parliamentary control on policy. Fifthly, there will be considerable areas of law applicable to Scotland as part of the United Kingdom which will remain wholly within the responsibility of Parliament, and such United Kingdom law will be administered by the Scottish judicial system. Sixthly, the law enforcement of all criminal law applicable to Scotland, whatever its source —be it Parliament, or be it the Assembly —will, according to the White Paper proposals, continue to be a function of the United Kingdom Government through the Secretary of State and the Lord Advocate in their respective fields

The seventh assumption is this. The appointment of the High Court judges, who serve both the Court of Session in civil matters, and the High Court of Justiciary in criminal matters, will continue to be made on the recommendation of the Secretary of State and, where appropriate, the Prime Minister. The responsibility for tenure and conditions of office will not be devolved. May I pause there to observe that it would be quite illogical and wrong that appointments of the Queen's judges in Scotland should be made on the recommendations of Her appropriate Ministers in the United Kingdom Government, but that such matters as tenure of office and conditions of service should be determined by the Assembly and its Executive.

While the White Paper is silent on the appointment of sheriff principals and sheriffs, we consider it would be wholly wrong in principle if they were treated differently from the High Court judges. They, like us, hold office under warrant from the Sovereign and, with minor exceptions, administer the same law, civil and criminal and from whatever source, as do the High Court judges; and constitutional propriety demands that their appointments should continue to be made by the Sovereign on the recommendation of Her appropriate United Kingdom Government Minister. I can tell your Lordships that the sheriff principals, with the exception of my noble and learned friend Lord Wilson of Langside, who could not attend their meeting, are of the same opinion as the High Court judges, standing the present proposals in the White Paper so far as devolved powers are concerned. They depart from us on a question of how there should be a judicial review of vires, but I shall deal with that shortly.

The last assumption we make from the proposals in the White Paper is this. The court system in Scotland must be regarded as a unity and responsibility for that system at different levels must not be split. This is recognised in paragraph 149 of the White Paper where it rightly said that the splitting up of responsibility would pose—and, may I interpose, indeed create— difficult problems over such matters as jurisdiction, procedure and administration. It is against that background that I turn to consider, from the constitutional and administrative point of view, the question of where the responsibility for the court system and its administration should lie; whether it should remain with the United Kingdom Government, or be devolved, with or without qualifications, to the Assembly and its Executive. That question is raised in paragraphs 144 to 151 of the White Paper, and is ultimately left open.

The constitutional changes envisaged, if effected, will be a long-term policy. The people talk about the rich heritage of our Scottish law. I agree that it is a rich heritage. But it is our duty not just to look to the past and to the present, but to look to the future; not just to acknowledge and preserve that heritage, but to seek to improve it and hand it down to successors in even greater measure than our predecessors passed it down to us. What we should not do is, for reasons of expediency, derogate from the status of our law or our law courts. What I am about to say, in my personal opinion, should be a test for every function under consideration as to whether or not it should be devolved. But I shall confine and relate it to this question we are now considering of where the responsibility for a court system and its administration should lie. That question should be answered by considering where in the constitutional fabric which is contemplated lies the system which will best protect the status of our courts, the preservation of our standards, and the most effective administration of justice in the interests of the people of Scotland, for whose benefit the whole legal system should be devised.

The answer should not lie in lumping this function into a package deal, whether of a maximum or a minimum nature, as a compromise, or for expediency, or for political reasons, if the merits of the issue dictate that it should go elsewhere. It is the considered view of the Scottish High Court judges that the answer lies in accordance with the second alternative set out in paragraph 150 of the White Paper. I wish to remind your Lordships what that paragraph says, in the alternative: it is arguable that the courts are essential elements in the core of constitutional unity of the United Kingdom and in the fabric of law and order; and that since they have to deal with disputes involving both devolved and non-devolved law, they should not be the responsibility of an Assembly which has no functions in the non-devolved fields. The same factors of public policy and national security which are relevant to the police and prosecution functions … point towards maintaining United Kingdom responsibility for the courts and their jurisdiction, administraton and procedure. May I try to develop that? I have prefaced what I have to say on this by asserting that in a social democracy such as ours the courts and their administration should be as independent of the Executive as possible. Under the proposals, however altered or modified they might be, our courts will be administering United Kingdom law, and our own common law which, in many cases, marches in parallel with the English common law; Community law, as well as legislation passed by the Assembly. In civil matters there will still be a right of appeal to your Lordships' House.

Nothing should be done to derogate from the status of our courts. Believing, as we do, that the courts and their administration should remain the responsibility of the sovereign Parliament, we tender arguments both of principle and of practical considerations to support that view. The principle is that the provision, maintenance and oversight of a judicial system in constitutional terms should be a function of the sovereign power, and that power after devolution will still be the Queen in Parliament. To give that function to a delegated body with limited powers which do not embrace the wide spectrum of the work of the courts would not only offend against that principle but might well lower, or appear to lower, the status of our courts in comparison with comparable courts in England. From the practical angle, the judicial system of Scotland must continue to be, in terms of structure, inter-related jurisdiction and procedures, both suitable for and capable of discharging the whole responsibilities of the system; that is, the administration of the whole law applicable to Scotland, which will consist, as I have said, of United Kingdom law, our common law, Community law and Acts of the Assembly in the devolved fields.

The court system in Scotland at each of its levels, and the jurisdictional and procedural relationship between the courts of different levels, can be considered properly only in the context of the totality of the functions it must discharge. The Court of Session (that is, the High Court judges), by acts of sederunt, prescribes the procedure for civil causes of all kinds in the Court of Session and in the sheriff court. The High Court of Justiciary (that is, the High Court judges), by acts of adjournal, regulates for all the criminal courts of Scotland on all matters of procedure not otherwise prescribed by Statute. In their capacity as judges of appeal these same High Court judges have constantly under review the work of all the courts in Scotland. They are accordingly, I would suggest, in the best position to see the work of all the courts in operation and to see whether procedural changes are necessary.

The Lord President of the Court of Session exercises powers of appointment to all kinds of statutory tribunals. I do not want to weary your Lordships, but am merely trying to illustrate the extent to which the administration of justice in Scotland at present is integrated and is regulated and controlled by the court system itself, free from Executive interference. It is true that the Executive is responsible for providing the staff and the buildings, but otherwise the administration of justice and the court system in Scotland is very much where it ought to be—within the hands of the court itself. It seems inevitably to follow from these factors and considerations that the system should remain with the Government and Parliament if the integrity of that system and its ability to discharge properly its functions are not to be impaired.

Power to innovate fundamentally in matters of the powers, jurisdiction and procedure of the courts within the system in any way which might disturb the broad relationship of these courts to each other, and the relative standing of these courts as courts of the United Kingdom, should not be confided to a subordinate authority with responsibility for only one of the sources of the law which the courts will administer. This, I must point out, will in no way derogate from the power of an Assembly to legislate on substantive law in devolved fields; but the suggestion from various sources (some of whom should have known better) that some, if not many, of these powers of the court should be transferred to an Assembly or to a member of its Executive, however designed, be he lawyer or be he layman, could be destructive of a system which has stood the test of time and kept it virtually free and independent of the Executive.

May I now, very briefly I trust, refer to a somewhat related matter. Paragraph 163 of the White Paper states that the Government provisionally favour devolving to an Assembly power to legislate about control of the distinctly Scottish legal profession. I am not quite sure what "control" in that context means, and I am sure we should all like to have it made more clear. The legal profession performs a vital role in the administration of justice in Scotland. In particular, the Court of Session and the High Court of Justiciary depend, in the proper discharge of their functions and in the interpretation, administration and development of the law, upon the professional assistance of members of the Faculty of Advocates. The Faculty of Advocates is indeed an integral part of the College of Justice in Scotland, and control of it has always been vested in the court. In the opinion of the judges, the legal profession in its two distinct branches, in so far as it discharges functions in and connected with litigation, is so inextricably linked with the judicial system itself that responsibility and control of the profession in its relationship with the judicial system must lie where responsibility for that system and its administration lies.

May I lastly now turn to the question of vires. I gather from the debate in another place that that question is now very open; and it has been adverted to and criticised by various speakers tonight, particularly by the noble and learned Lord, Lord Hailsham of Saint Marylebone, my noble and learned friend Lord Kilbrandon, the noble Lord, Lord Hughes, and the noble Baroness, Lady Tweedsmuir. Accordingly, I do not want to go over the points that they made, but may I say that the idea that the ultimate decision on a matter of vires should rest with a Minister of the Crown is one that offends what we regard as all constitutional propriety.

In spite of the checks proposed while any Bill is going through the Assembly to satisfy the Assembly about its vires, and whatever checks may thereafter be made by a Minister of the Crown, there may be cases, even if they occur rarely, where the Assembly Acts exceed, at least in certain of their provisions, the powers devolved by the devolution Statute, or where conflict emerges between the provisions of the United Kingdom Statutes and Assembly Acts. It would seem contrary to sound constitutional principle and, one would think, wise public policy, that any person entitled to invoke the jurisdiction of the courts whose rights are affected by provisions which, ex hypothesi, are ultra vires, should be denied the protection of the courts. To admit the right of challenge would have the clear advantage of securing respect for the constitutional arrangements embodied in the devolution Statute, and may result in the development and acknowledgment of a body of principles governing the boundaries of the respective competences of Parliament and the Assembly.

Let me deal with two arguments levelled against this. The first is simply the question that vires being decided by a Minister would produce finality and not hamper good government. I think that what was said by my noble and learned friend Lord Kilbrandon on that subject is the short and complete answer. Secondly, it has been said by a Minister in another place that since the vires of an Act of Parliament cannot be challenged in court, why should the Acts of Assembly be in a different position? He was not comparing like with like. It may be true of sovereign legislation passed by a sovereign legislative body; it is not true of Acts passed by a devolved legislative body whose powers are written into a constitution enacted in legislation by the parent Legislature. It is, in our submission, in exactly the same position as legislation of subordinate nature which has been passed and has always been subject to challenge in the courts on the question of vires.

Nor do we believe that the question of vires should be examined in a vacuum by some judicial body. This is where we part company with the sheriffs principal. We have never believed in Scotland in courts setting up theoretical rules or making theoretical decisions which have to be followed in practical cases. We do not have McNaghten Rules or Judges Rules. We believe that the law can best be determined, enunciated and applied through principles which have been determined from practical problems and considerations brought before the courts. With the best will in the world, the academic exercise might overlook some practical point not envisaged by the draftsman or spotted during the exercise. We accordingly believe that there should be written into a devolution Statute an express provision that the vires of an Assembly Act can be challenged in court by a litigant. If that principleis established, the mechanics of how it would operate in practice in different cases could no doubt be left to be worked out by the courts themselves.

My Lords, I apologise for detaining your Lordships at this late hour with such a long speech, but I should point out that judges do not have any public relations organisation through which they can make known their views. It is very seldom that they are called upon to express a collective view. In my 22 years' practice on the bench this is the first time that this has happened. The only forum we have, because we cannot use the media, is the bench—and that is designed for other purposes. May I make this appeal, having put on public record in the only way we can the views of the High Court judges, that if these views commend themselves, not only to your Lordships but to others who are responsible for the ultimate decision on these matters, we feel that the status of our institutions and the nature of their administration will be preserved in a manner which the alternative might easily destroy.

9.3 p.m.

Lord KINNAIRD

My Lords, it is getting late, and we have still 14 speakers to go. After the last learned but lengthy speech I shall try to be brief and I hope that others will follow suit. There is one aspect of this debate that I want to stress that I do not think has yet been touched upon; that is the aspect of timing. I have listened to most of the speeches in this debate. The speakers have spoken as if devolution had already taken place—and this disturbs me. What also disturbs me is joining in a debate at all with speakers like "Messrs. Hailsham, Home, Mansfield, and all". But I cheer myself on with the thought that it takes all sorts to make the world. Before going any further I want to make it clear that I speak as a United Kingdom Peer. I also want to make it clear that what I have to say is not aimed specifically at this Government but at successive Governments over the last 30 years. Over that time, it seems to me that so much has happened so quickly that our judgments have become clouded and perhaps have gone a little astray.

Before talking about devolution I want to say something about" our changing democracy". We are no longer a wealthy country; yet we squander our money as if there were no end to it. We are no longer a self-supporting country; yet we allow our industries to be brought to a halt. We used to be a traditional country; but the powers-that-be see fit to do away with country boundaries, replacing them with vast districts which few people want—thinking to save money (as if they cared) but, in fact, necessitating an even larger army of civil servants. We are rapidly becoming an overpopulated nation needing to keep our best brains and to encourage them to stay in this country; yet, through taxation, we drive them away. We are now a vulnerable country and have recently joined Europe for the sake of greater collective security; yet, almost beyond belief, we continually cut our defence expenditure. Soon we may be in danger of splitting ourselves in two, like the atom. My Lords: "Whom the Gods wish to destroy …"

It is all back to front and it rather reminds me of the game of chess played by the Red Queen with Alice in Wonderland, when the Red Queen asked:" What square do you want to be on?" "That one," said Alice. "Oh dear", said the Red Queen. "We shall have to run very fast to get to that one." After some minutes, Alice said: "This is ridiculous. We've been running, as fast as we can, all the time and we're still in the same place." "It isn't ridiculous at all," said the Red Queen. If we hadn't been running as fast as we have we shouldn't even be where we are now."

I think that is perhaps not too bad a reflection of life today. I would hazard a guess that our ancestors would be dumbfounded if they could witness some of our modern-day, nonsensical illogicalities. If we go on like this, I should not be the least surprised to hear that Her Majesty's Government intend to nationalise the Press. And why?— so as to ensure more adequate space, more fully to report balanced speeches made by Conservative Peers in the House of Lords.

As I said, our ancestors would he dumbfounded. They gave themselves more time for thought to think things through more thoroughly than we do today. Today it is all "go", but going where? Surely that is the point. There is far too much legislation forced through Parliament with far too little time for digestion. It is not that I am necessarily against change. In a democracy such as ours change is inevitable. We must accept it and we must try to guide it. There are a great many people in the world today crying out for guidance and, unfortunately, there are a great many people in the world in need of guidance, though they are unaware of the fact. Neither am I against a measure of devolution, or further devolution; that may be inevitable. To those who would" push the boat out" a little further, I would say this:" Is it the right time?".

A few weeks ago, I was reading Newman's Apologia, and I should like to quote a few lines as the words struck me as appropriate to this debate: There is a time for everything, and many a man desires a reformation of an abuse, or the fuller development of a doctrine, or the adoption of a particular policy; but forgets to ask himself whether the right time for it is come". Those are the words of our wise English Cardinal, John Henry Newman: Whether the right time for it is come". Timing is so important; and I think that first we should aim to reunite the people of this once great kingdom; that we should aim to strengthen the links recently forged between us and our neighbours in Europe; that we should aim to work together to bring back more prosperity to this country before indulging in internal politics. Let us put first things first, without fear and whatever the immediate hardships. Our ancestors did. They travelled hard, often uphill, through many centuries, often fighting bloody battles on the way, until the summit of union was reached and peace achieved. Do not let us put that achievement at risk. Do not let us be pushed too quickly or too far. Let us today think very carefully where we are going and along what path we wish to travel. Otherwise, we may well find ourselves slipping backwards down the hill up which our forbearers so painfully climbed, landing at the bottom with a great fall, like Humpty-Dumpty. And should that sad fate overtake us, it may indeed be a case of: All the king's horses, And all the king's men, Could not put Humpty-Dumpty together again.

9.11 p.m.

Lord HEYCOCK

My Lords, when I requested that I should take part in this debate on the first day, I little realised that on entering your Lordships' Chamber today I would feel as if I had wandered into the wrong place. I hope at this late hour I will get the same warmth from my Scottish colleagues that I receive when I go to Edinburgh when Wales plays Scotland at rugby. I can assure them that when they come to Wales on the 7th, the Scottish people, a small nation of 5 million, will be given that kind of welcome from Wales, a small nation of 2½ million. In that spirit, I am intervening in this debate. I have listened for many hours to those who are for or against this vital and fundamental change in the structure of government in our two countries. Our association with our English compatriots goes back farther than the Scottish Act of Union, back to 1536. There has been organically an evolutionary development of government over those years. Therefore we are now examining closely the impact which the proposals in the White Paper are to have upon our nation.

Whether the devolution proposals are ones which commend themselves, whether they will improve the government of our country, is questionable at this stage. Recently during the debate on local government reorganisation I made a statement—it is in Hansard—that I felt logically we should have delayed reorganisation of local government until we had seen the impact of, first, the Crowther Report and, subsequently, the Kilbrandon Report, on this country. If that reorganisation had been delayed for some years, I am certain the circumstances under which we would be examining the proposals for devolution would be essentially different.

I come from a county that has split into three. What disturbs me is that for two years we have tried to organise the unit of local government in a new county, so that we can represent clearly the interests of the people under our statutory obligation. There is an essential difference between the local government's responsibility and that of the Executive Committee. Local government fundamentally operates under Statute; the elected Assembly will have devolved powers. In Scotland there will be legislative powers and there will be delegated powers in Wales. As a leader of local government in the Principality, my concern is to try to discover what is to be the impact of the new Executive Council upon the future of local government. It has been said by Ministers in another place, and probably here too, although I have not heard it so pronounced today, that the elected Assembly will have no effect whatsoever upon the functions of the local authorities. If you talk about being near to the people, I would say that essentially the county councils are much nearer to the people than the new elected Assembly will be, both administratively and in meeting essentially the needs of the people.

It is said in this document that the current functions of the local authorities will be retained. Local government in Wales and in England has been linked since 1888. The statutory requirement laid upon English counties was the same kind as that imposed upon the counties of Wales. They synchronised together very clearly. Therefore, if there are new functions which are to be given to the English counties, I would ask, is it a sin? —because "current" means "present". I finished my education logically in a primary school: I have no academic education whatsoever and I have always understood that "current" means "present". It means, in effect, that if there is any change in the function that is one kind of apprehension which concerns the local authorities in Wales. That is the first point.

When we examined the consultative document which preceded the White Paper, we were asked for two options. We decided at that stage, in our wisdom or otherwise, to opt for an elected Assembly on the basis that, if there was to be a change in governmental organisation of the Principality, then at least the local authority should not be touched and the Health Service should become a corporate part of the local government organisation. But when we examine the contents of the White Paper—I have looked at it very closely—they are indefinite and not conclusive. One hopes that, when the Bill is put together logically, in that sense we shall have more definite assertions about local government.

Going to the next stage, it is said that the control of education—this is the phraseology of the White Paper that am using—shall be vested in the Executive Assembly. I ask myself clearly, as the chairman of the Welsh Joint Education Committee which, in the historical sense, has made a significant contribution to the educational development in Wales and has co-ordinated logically all the activities of the local education authorities in Wales, why there is not a single mention of it. There is not a single mention in the White Paper as to what is to happen logically to the Welsh Joint Education Committee, which has played such an important part in the last 28 years in the Principality and its educational life. We are concerned in Wales, as the Scots are in Scotland, with the broad philosophical sense that a civilisation owes it to its people to give them the maximum opportunity to develop their intellectual skills. We have tried to do that in Wales. When I was first the chairman of the Glamorgan Education Committee, we were given 66 scholarships and 44 places in a training college. We believe that to enrich our civilisation and to enrich our country we should use the intellectual skills of our people. At the end of my chairmanship there were 8,800 boys and girls in the universities of this country. Intellect does not grow in the castle any more than it grows in the humble cottage, and civilisation, if 1 may say so, lies in giving the boys and girls of that country that kind of opportunity.

The next point is clearly a question of planning. If ever there is a mistake in local government and if ever there is any acrimony, it is because of a dual application of planning between the district and the county council. There is great difficulty in relation to planning, whether or not when we give planning and environmental functions to the Assembly, we give economic planning to the Secretary of State and then we leave the rest of the planning to the local authorities. Local authorities are concerned about that kind of situation.

Then there is the question of finance, which I hate to mention because it has already been referred to by several of our Scottish colleagues. But after local authorities have completed their negotiations on the rate support grant they can decide what to do with their allocation, spreading it over to meet their requirements. But we find in the White Paper that the block grant is to be given to the Assembly, which will be able to decide what to do. At the moment, there is a consultative committee on which I am privileged to serve, and there is also a rate support grant committee which examines the finance of the local authority. But those functions are to be transferred to the Assembly which will make a block grant allocation. That, again, is a negation of the power. I have been in public life for 40 years and I do not see how we can find sufficient work for a community council, a district council, a county council and then an elected Assembly, with a population in the country of only 2½ million.

I was not very impressed by the Prime Minister on the question of local authorities, and on the question of their functions some day being taken away. In this country we have achieved the finest method of government in the world. This is the freest country in the world and it expresses its freedom in every organ of government, from the local authority right up to the central Government. So that while the Welsh counties are prepared, in every sense of the word, to support an elected Assembly, they want to be perfectly clear about the responsibility involved and to be sure that the 1972 Act will not be eroded.

Next there is the question of the referendum, which has already been mentioned today. Some people say," You want a referendum for everything. But once Acts are on the Statute Book, any Government, of whatever political philosophy, can make alterations."That argument is logical. But there was a referendum in Wales about our entry into Europe, although in our early debates it was said that we did not want a referendum. However, in the end, it is the people who decide. Lincoln talked of government of the people, by the people, for the people, and if there is to be a constitutional change which affects the people then it can be made only by seeking their opinion.

I know that there are philosophical differences in the approach to devolution of Wales and of Scotland. I believe that the impulse of nationalism in Scotland is an economic one, and that the approach is far more emotional than it is in Wales. If I go down the High Street, I can talk to a dozen people who do not know the first thing about devolution. The most emotive question in Wales, which the Government must face up to, is unemployment. In my area we had a strike recently because men were concerned about their jobs. The Welsh are accepting the process of devolution, but there is a growing feeling that there should be a referendum. It appears that the flame has been lit and that it will grow. I say to this House that in a democratic society the people of Wales should be given the choice. Logically they have the right to determine their own destiny. I do not know whether there are strong personal feelings regarding devolution. I have been in politics in South Wales for the best part of 55 years and in local government there for the best part of 40 years. My family has an association with a certain political Party that goes back to the beginning of this century. Therefore, I was nurtured in that environment.

My last point is that I believe that there is a difference of approach in Scotland: that the motive there is economic. In Wales the motive is the kindling of our nationality and nationhood, not nationalism. The problem is linguistic. The emergence of the instinct of getting something for Wales emerged organically from the question of language. Again, may I say to the Government that, if we are to consider the problems of Wales, we must have a separate Bill. Why should Wales be linked to somebody else? Do not let us link the two. There are different circumstances in Wales. Fundamentally and philosophically, there is a difference between the Welsh and the Scottish approach and it is right for the Welsh people to decide their own destiny within the framework of a Welsh Bill.

Like a Welsh preacher, I have made three points. I hope that my noble friends on the Front Bench will at least take cognisance of the anxiety of the local authorities in the Principality about the erosion of their functions. Secondly, I hope that they will give serious consideration to the question of a plebiscite for the people of Wales. You can have a plebiscite for the English afterwards! The two countries which are closely involved with the change in their government are Wales and Scotland. Therefore I make a plea for a separate Bill for Wales.

I am privileged to have taken part with my Scottish colleagues in the debate and I have enjoyed listening to their points of view. I paid great attention to the speech made by the noble Lord the Leader of the House. I do not wish to speak about the reserve powers of the Secretary of State; they are part and parcel of the White Paper. Once the Bill is finalised one hopes that it will be much clearer than is the White Paper.

9.29 p.m.

The Marquess of ABERDEEN and TEMA1R

My Lords, may I first of all say how agreeable it is for an expatriate Scot who lives in England and who loves both North, Mid- and South Wales, to hear a Welsh voice tonight. Secondly, I wish to add to the chorus of proper praise to my noble friend Lord Minto who has made his maiden speech today. In that connection I will say only that it is much more gruelling when you get up for the second time, which is my position tonight.

This is 1976. We, as well as the Americans, are celebrating the 200th anniversary of the Declaration of Independence, and this year also seems to be the one in which we are starting on the long haul towards devolution. Is that an ominous conjunction or a happy coincidence? We shall see. I said" devolution" not" dissolution". I will not hammer in what has been said by speaker after speaker in this debate, that the vital need is to preserve the unity of the United Kingdom. The noble and learned Lord, Lord Kilbrandon, said that institutions should last only as long as they are useful. He then qualified that by saying that he believed the United Kingdom would last through the lifetimes of his children and his children's children. All I can say to that is: It had better. That is the goal.

To my mind, the White Paper is all right as a basis for argument, but not as a blueprint for legislation. The noble Lord, Lord Shepherd, advanced it, as others have done before him in another place, as being one of the greatest constitutional reforms proposed for heaven knows how long, but I am afraid I cannot agree with that. There is, too, the pretence of a slow and carefully worked out timetable, and I cannot help feeling that this is a mask for offering too little too quickly. The noble Lord, Lord Shepherd, referred to other schemes as "cosmetic tinkering". I think that charge could be levelled, at some points anyway, at the White Paper, which to me seems to be doing too little too quickly. It is confecting a kind of instant porridge—too much sugar for the cautious and not enough salt for the bold. I find the approach unradical, reluctant and, as my noble friend Lord Perth described it, timid.

In another place the Lord President made his remark about doing nothing being no longer an option in response to putting exactly that proposition as being the wish of some people. This proposition was greeted with lusty cheers from the Benches behind him as well as from many people on the Conservative Opposition Benches. Doing this little, holding the power in Westminster and the purse strings in Whitehall, seems to smack too much of being an attempt to placate many voters in Scotland, perhaps fewer in Wales. That really is not an option today. Doing nothing may be. I do not agree with it, but it may be.

In connection with the holding of the power in Westminster and Whitehall I was reminded of an article by Mr. John Mackintosh in the New Statesman recently, when he instanced as a symptom of the attitude of the Labour Party in these matters that certain Labour Party appointments in Scotland are made in Transport House and that to him—and I must say I agree with him—is symptomatic and is reflected in the White Paper, while so much of the real power is still kept in Westminster.

As I said, doing nothing is probably still an option; but, better still, let us open up the way to a wider and deeper reform; call it "federalism" if you will, or" true devolution", as the noble and learned Lord, Lord Hailsham of St. Marylebone, described his view of the matter. The present proposals seem to me to invite, if not perhaps dissolution then inevitably an increase in dissension between one part of the United Kingdom and another, which might one day lead to the breaking up of the United Kingdom. Some thought there was a possibility of Shetland drifting off in what is described as a Faroese solution. Why we have to talk about a Faroese solution rather than a Shetland solution, I do not know.

I am told we are to await the White Paper on England. For the purposes of argument, let us suppose that the principle of regional Assemblies, for which there is a certain clamour, is extended to England. I am going to imagine a situation which might occur in the future, and which in fact did occur in the past. I go back 14 or 15 years, when Manchester Corporation promoted a Private Bill to draw more water from Ullswater. This was a matter of controversy at the time, and I remember listening to a debate in this House in which the late Lord Birkett made a very great speech, an unrivalled piece of advocacy. In fact it was Norman Birkett's last case, and he won it. He was dead a few days later. I remember that the noble and learned Lord, Lord Hailsham of Saint Marylebone, had to defend Sir Philip Dingle and the Manchester Corporation from the Treasury Benches.

My Lords, let us suppose that under a system of regional Assemblies in England, Manchester tries it on again, through Private Bill procedure, or through the regional Assembly. I have read paragraph 66, although I cannot make much sense of it. But Manchester and Ullswater will be in different regions. Supposing they get together, that there is collusion to promote this Bill, and it is considered either against general policy or ultra vires. Is Parliament then asked to vote the Minister the use of reserve powers? In 1962, but for Norman Birkett, Parliament would probably have let the Bill go through; so also possibly would a future Parliament, operating a new procedure, itself constituted as Parliament is at present under the White Paper. That would be disastrous for the Lake District. So, is there a Norman Birkett in the House, or in another place? I doubt it—and the risk that I may be right is really too great to face.

We must look to the option of a federal system, treating England as a whole—England, Scotland, Wales and Northern Ireland. Inevitably that means a written constitution enacted through a Bill of Rights, the checks to the local Executives and the protection of individuals and minorities resting with the courts. On the other hand, the White Paper proposes reserve powers. This depends on a Parliamentary majority. Here I refer to a BBC Radio 3 discussion broadcast for the second time only last night, in which the noble and learned Lord. Lord Kilbrandon. took part. I will not quote him, but I will quote Professor John Mitchell, a notable constitutional lawyer. He explained his preference for using the courts and Parliament rather than Parliament alone to test whether there had been a constitutional abuse, because a majority in Westminster"— which means another place of course— may be a majority because the Opposition is incoherent. As a notional coronet I wear a kind heart on my sleeve at least, so let us substitute"not united" or divided" for" incoherent", but, surely, that is enough to expose the weakness of the reserve powers, though it is only fair to add that the broadcast conversation was about human rights and not about devolution.

Now I am going to quote another broadcast supporting a written constitution. In 1969 there was a Third Programme discussion, in the preparation of which I had some say, called" Do we need a written constitution?"A certain Mr. Quintin Hogg, MP took part in the discussion, and he said, Yes, we did need it. He said it eloquently and at length. I thought he spoke more firmly about it than did the noble and learned Lord, Lord Hailsham, this afternoon, but I understand sitting on the Front Bench necessitates leaving one not quite so free as perhaps one might otherwise be. Another distinguished constitutional lawyer, Mr. Anthony Lincoln, was against the idea of a written constitution. He said it was only spelling out in black and white what was already available, already there. The issues cited at that time were, I think, largely the matter of the Kenya Asians, the Burmah Oil affair and also Ullswater.

But when the question was put to Mr. Lincoln as regards what was then called" regionalism", he readily conceded that if regionalism comes in, of course, there will have to be a written constitution. How quickly the language changes, my Lords."Regionalism" is now"devolution", and there is now a new word, which was used by my noble friend Lord Minto, which is" regionalisation". Should we, if we secure a written constitution, be able to amend it? Well, of course, but only with difficulty. I am not very strong on American history, but I think the American constitution started to be amended almost before the ink was dry on the original document.

My Lords, no referenda please; no plebiscites! One to me was enough. Leaving aside the case for expatriates like myself, let us suppose there is a referendum in Scotland. First of all, you have to frame a question which will be comprehensible to people on this very complex subject, and capable of the answer" Yes" or"No". Secondly, it will disfranchise temporary exiles from Scotland—this is the example I choose, Scotland—who may be away from their birthplace and the place they mean to return to for a very short time, a period as short as five years. All depends on whether you are on the electoral roll. Equally, it gives the vote to a number of temporary incomers. It is obviously not practicable for people like myself to get a kind of union ticket, a card to show that I am a Scotsman, which will entitle me to a postal ballot. That is ridiculous. But why is there such keenness on a referendum? Are people afraid of the normal democratic processes? If so, could that possibly be because in Scotland the organisation of the two great Parties in the State has not for many years been as well developed as it has been in England? Great play has been made here and in another place about the sovereignty of Parliament, which of course, quite rightly, means the supremacy of the House of Commons. But if you had to choose between that and the continued unity of the United Kingdom, which would it be? I know which I would choose.

9.45 p.m.

Lord DRUMALBYN

My Lords, I do not know whether it is more unpleasant for somebody to rise to speak at this time of night than for those who have to listen to him. I am conscious of the difficulty, and particularly the difficulty for the noble Lord, Lord Kirkhill, who has to wind the whole debate up. I should like to try to approach this subject for a few minutes from a slightly different angle from that which has been adopted so far. May I start by saying that I have been in favour of an Assembly for Scotland for as long as I can remember. It has not always been timely to proceed with this, but during all this period—one way or another, I have been in Parliament for about 30 years—I have seen the development of the growing involvement of Government in the individual lives of the people.

I have seen how quite a lot of this has been done purely by Scottish hands in Parliament, or virtually by Scottish hands in Parliament, through the Scottish Grand Committee, with the growing powers of the Scottish Grand Committee first to deal with matters, deal with Second Readings in Committee, and so on, and the growing powers of discussion in Committee. Side by side with that one has been conscious of the fact that there has been far too much legislation which has been oppressive for Members of Parliament as a whole, and not only on the time of the House—people talk a lot about the time of the House—but in the number of things a Member of Parliament has to get involved with. If you can divide these functions nowadays between one Assembly here in Parliament and one, say, in Edinburgh, it seems to me only sensible to do it. That, then, is my first point.

In politics we are dealing with what is practical at any given time and, above all, we are dealing with people. I think here of the electors and the representatives elected. The electors must know, or be able to find out, precisely what they are electing their representatives to do, and the representatives must know what they can and cannot do. If there are to be men and women elected to a Scottish Assembly, and other persons elected to the United Kingdom Parliament, it follows that there must be a clear demarcation between their functions; no blurring at all. Each elector must know to which of his representatives he should look to deal with a particular subject in which he is interested at the time.

My first reservation about the White Paper is that I do not think that the electors will quite know this. The mere fact that a matter that has been dealt with in the Assembly can subsequently come before Parliament, perhaps to annul it, or whatever it is, means that those who are elected to Parliament will also have to know about that subject and will be involved in it. I suggest that the Assembly's decisions on transferred subjects—subject to what I shall say in a minute or two—should be final, and the weight of opinion which has been expressed in this House today supports that view. To embroil Parliament with this would lead to confusion of the functions of Scottish Members of Parliament with those of the Members of the Assembly. More important, it would also prove totally unacceptable to Scottish electors in the long run. If, constitutionally, legislation passed by the Assembly needs the imprimatur in some form of Parliament, that could surely be arranged in a suitable form; our capacity for constitutional innovation is unlimited. What matters is the principle that consent should not be withheld if the legislation could have been passed by the United Kingdom Parliament. That is the principle which must stand and that is the reservation I have mentioned.

If the legislation is ultra vires, then any court could say so, but clearly Scottish legislation must comply with Britain's obligations under the EEC or any other treaty. How that is to be determined depends on what is practicable. I understand that Her Majesty's Government already consult the Commission, the EEC, about legislative action before introducing the legislation or while it is before Parliament, or possibly both. Presumably the same could apply to Scottish legislation. There seems to be no reasonable objection to Her Majesty's Government passing Scottish legislation to Brussels in the same way as United Kingdom legislation. I suggest that it would help if there were a representative of the Scottish Administration on the staff of the High Commission in Brussels, and no doubt the same could apply to administrative action within the scope of the Scottish Executive.

I join with others who hope very much that a better name can be found for the elected Heads of Departments in the Assembly than Members of the Executive. Is there any reason why there should not be a High Commissioner, or whatever he is to be called in Scotland, who would appoint Ministers on behalf of Her Majesty in Scotland? The Kilbrandon Committee saw no objection to there being a Premier and Ministers in Scotland. Nor do I see why the Assembly should not be called a Legislative Assembly or Convention; after all, MLA—Member of Legislative Assembly—is a well-known term and is very well precedented throughout the Commonwealth.

On reflection, I hope the Government will see the absurdity of the Secretary of State of one Party appointing Ministers or even an Executive of another Party. The Secretary of State never has been, is not and cannot be above Party, however much civil servants occasionally may like to imagine he is. We must accept that there will be occasions when the Administration of Scotland will be of a different political hue from that of the United Kingdom; that would be likely to happen even if the Scottish Assembly were elected at the same time as the United Kingdom Parliament, but that is not what is proposed. I agree with the recommendations of the Royal Commission and of the Government that the Assembly should be elected for a fixed period, and four years seems a reasonable time.

However, I do not agree that the same voting system should necessarily apply for the Assembly as that which at present applies for the United Kingdom Parliament. I agree that the constituency boundaries could be the same, but I am not sure that there need be twice as many Members of the Assembly as there are Scottish Members of Parliament. It might be that there should be more in order that the sparsely populated areas, particularly the Highlands and Islands, should have a higher representation than they would have on a strict population basis. I am sure, however, that we cannot disregard the existence of the Scottish National Party, a purely Scottish Party at present commanding the support, if Gallup polls are anything like right, of over one-third of the electorate.

If the unity of the United Kingdom is to be preserved—Ibelieve that everybody who has spoken so far has supported the need to preserve it, and even the noble Lord, Lord Belhaven and Stenton, did not dissent—it seems essential that politics in the Scottish Assembly should not be polarised into"separatists"and" unionists"if I may use the term with a purely Scottish connotation. We cannot ignore the fact that there are at present three Parties in Scotland each commanding between a quarter and a little more than a third of the electorate. The fact that, according to the polls, only half—give or take 3 or 4 per cent.—of the Scottish National Party really wants separation is beside the point. How they vote matters in practical terms more than why they vote for a particular Party. Another matter which cannot be disregarded is the fact that a further Party—the Scottish Labour Party—is threatening to emerge. In these circumstances, I cannot understand why the Government have accepted a fixed period for elections while rejecting a system of voting which will reflect the strength of votes cast for each Party. Perhaps the most suitable system is that which operates in Germany, as it avoids the multiple representation of large constituencies which the single transferable vote implies.

There is very little likelihood of any one Party having a working majority. Surely it would be very hard to justify an Administration formed from more than one Party, unless it represented a majority of the electorate who had voted. Moreover, with such a division of Parties, it would be far easier for Administrations to be changed during the life of a Parliament in such a way as to command public approval if the strength of the Parties genuinely reflected the voting in Scotland. One advantage of having an Assembly in Scotland is that it would be far more likely to attract into politics able Scots—men and women who could not afford to embark on a political career if it meant having to come to London.

I do not wish to detain your Lorships much longer, but there are four points which I wish to make. The first relates to the Secretary of State. I believe that there is no need and no place for a Secretary of State if Scotland has her own Assembly and some independent representative of the Queen. That Assembly would deal with the affairs that are at present dealt with by St. Andrew's House, and if it went beyond the powers conferred on it by Statute, the courts could tell it so. It would not need a Secretary of State for that. It could be a convention that there would always be a Scottish Member of Parliament in the Cabinet and it need not matter whether he was Minister for Trade, Employment or Defence or even Prime Minister. He might even be Chancellor of the Exchequer, although he would clearly have to be extremely impartial in dealing with the various sectors of the Kingdom. There would also always be the Lord Advocate. If I am right, the Lord Advocate was the representative of Scotland at Westminster for 150 years before a Secretary for Scotland was appointed and he would be the best person to advise the Prime Minister and could fulfil the requirements laid down by the Lord Justice Clerk, the noble and learned Lord, Lord Wheatley, as was done for many years.

The second matter is agriculture. Agriculture must be a special case. It always is. I believe that it should be within the competence of the Assembly but that agricultural policy for the United Kingdom should be determined by the Minister of Agriculture together with the corresponding Scottish Minister and that the latter should always accompany the former when he goes to Brussels.

The third point is the problem of finance and taxation, which is always with us. The Opposition in the Assembly will always say that Scotland is not getting her fair share. One can look forward to that with certainty. But, as I see it, the Scottish Administration will have to submit estimates to the Treasury, and the Treasury will have to decide, after discussion, how much of the national cake should be consumed in Scotland. I do not see any escape from this. We shall have to ensure some independent means of telling the Scottish people why that is their share. This will be extremely important in the future. The Scottish people will also have to be reassured that the block grant so arrived at will be adjusted, if English expenditure on the same types of Vote has to be adjusted because of inflation, or stringency, or whatever. The idea that Scotland will be able to go beyond this block grant only if they raise money by means of rates is not very imaginative. We shall have to do better than that, but this is not the time to discuss the not very popular rating system.

Lastly, my Lords, do not let us delude ourselves by thinking that we can ever reach a final solution. I got the impression from the White Paper that it is time we reached something that is absolutely final. Whatever Act is passed setting up the Assembly can be amended by another Act, or repealed. A suggestion has been made that it should be possible to amend it by order, but I am not so sure about that. I think that this is too important a matter to be capable of being amended by order. But let us be content to start with the transfer of those subjects which are already dealt with wholly by St. Andrew's House. For my part, so far as representation in Parliament is concerned, if the Speaker can certify a Bill as being purely Scottish, he can equally certify a Bill as being purely English, or English and Welsh; in that case I cannot see why there should not be a convention that Scottish Members should not vote on such Bills.

The noble Lord, Lord Rhodes, said that whatever is to be done should not be done in a hurry. I believe that we should get on with this, but I do not think that we should do it in a hurry, if that means doing it badly. If we are to get an Assembly under way properly, we might make quite certain that the constituency boundaries in which the first elections are to be held are sound and can be justified.

10.3 p.m.

Lord WILSON of LANGSIDE

My Lords, it was my misfortune that one of the few speeches in this debate which I missed was that of the noble Earl, Lord Minto. Nevertheless, it is not in any spirit of affectation or hypocrisy that I add my praise and congratulation to him for his contribution, for already outside the House I have heard a great deal about that contribution. It is a happy accident perhaps that tonight, even at this late hour, I should follow in the list of speakers the noble Lord, Lord Drumalbyn, because I last confronted him on the hustings more than 20 years ago in Dumfriesshire which, as some of your Lorsdhips will know, lies at the Southern end of Scotland. I first met the noble Lord 26 years ago at the same hustings. I am sure that it will be no surprise to your Lordships to learn that I made no impression at all on the noble Lord's constituency his political skill and personality were too much for me; but it is a pleasure to follow him again tonight.

It has been said that the excitement of perpetual speech-making is fatal to the exercise of the highest powers. Someone—I think it was Froude in his biography of Bunyan—put it that way, and wise men, before and since, have been saying very much the same. There must be something in it, must there not? It must help to explain a little some of our peculiar current political, economic and social troubles about which so much is written and spoken, both in your Lordships' House and in the other place, and, of course. up and down the country. Of course, it is a thought—indeed, a sobering thought—that today the opportunities, not only for making speeches but, after they are made, for disseminating them, are very much greater than they once were.

I imagine that when the philosophers of Ancient Greece were prophesying doom it must have been a relatively simple thing to get away from the boredom of it all by staying quietly in your own garden in the North; and, even as recently as Gladstone's time, when he went off on his campaign in the Lothians, as far as I recall, he could not be interviewed on" the box"while he was on his way North by train. I am sure that that was very much better for both him and the British people. But whatever reservations we may have about speech- making as a creative activity, the fact is that the occasion of this debate is, unfortunately, one of these occasions on which all Scotsmen are convinced that they must speak their minds. It is only about Scotland and Scotsmen that I can speak. I cannot know about the English or the Welsh, but in relation to this matter I imagine that they suffer from a similar compulsion. They must do if they are seriously concerned about tile constitutional arrangements under which their separate countries may be governed in the future.

The first thing that arises in my mind out of all this is that it would be a rich and rare thing if our two largest political Parties could see their cantrips of recent years through the eyes of the thoughtful, sceptical and increasingly disillusioned electors there. They would, I am sure, learn something to their advantage. The late Clement Attlee wrote a hook called The Labour Party in Perspective. I remember reading it in the 'thirties as a young member of the Labour Party. It was, of course, a simple, unsophisticated work compared with much of the modern stuff. There is always a danger", he wrote, of a political Party concentrating exclusively on winning votes". If it does, he went on to imply, it loses its soul. He was not being nave. He knew as well as anyone that political Parties are in business to win elections. He was a man of few words, and each word counted. The stress here, of course, was on the word" exclusively". The danger seen by the man who was by far the most effective peace-time Prime Minister in my lifetime was in political Parties concentrating" exclusively" on winning votes.

That, of course, is what the two largest political Parties have been doing in Scotland throughout the chapter of the devolution saga which began with the Hamilton by-election in 1966 and ended with the publication of the recent White Paper. Things are changing now, happily, but, manifestly, up until that time, it has been electoral considerations which have dominated the thinking of these two Parties. The result, of course, is that instead of winning votes they have been losing them madly—and this was inevitable. They will go on losing them unless they change course, as I think they are doing and as I think they will do; because if the Nationalists are indeed just political patent medicine men—I do not say they are, but if they are, as the Government and the Conservative Party imply—you will not beat them at their own game. If you meet their challenge by setting up in the same kind of business, you will not win. The thoughtless will vote for them and the thoughtful will desert you. So it is no good offering another patent medicine with a differently shaped bottle or a different label. If you want to defeat the medicine men in Scotland, you will only do it with a bit more practical sagacity and a bit more concern for principle the sort of thing, as I understood it, that the noble Lord, Lord Rhodes, was talking about this afternoon. I am sorry that he is not still here. By that way you may be able to satisfy the people that the proper medicine is, at best, coloured water and, at worst, poison. That is the first thing in my mind about this.

My Lords, the second point is this. If any substantial good came out of the Royal Commission on the Constitution it was the Memorandum of Dissent presented by the noble Lord, Lord Crowther-Hunt, and Professor Peacock. I do not suppose that many of us would accept it all as gospel; but it was readable, stimulating and sensible. It has special merit in two particulars. It provides a ready-made critical analysis of the Majority Report and its proposals in Chapters 6 and 7 it sees" as a programme for a generation" and not something to be attempted overnight.

There has been too much" instant devolution" (has there not?) from both the Labour and the Conservative Parties. These two Parties, if I may say so, remind me in this context of nothing so much as the little girl who used to talk too much. Her mother admonished her saying,"Think before you speak". She answered," Mummy, how do I know what I think until I hear what I say?"It seems to me that this is a not unfair comment on the approach of the two principal Parties to this grave issue. It is disturbing to think that the fate of nations might be decided on that kind of approach.

The third point in my mind is that the one good thing about the White Paper with which we are concerned tonight is that it has brought the devolution debate to life throughout the country. Much wisdom was talked in another place. The ratio of sense to nonsense was as high as one could reasonably expect it to be; and the impression is growing among many of us in Scotland that already a lot of people are having second thoughts about it all. It may be that that is just wishful thinking on my part.

The fourth thing in my mind is that, of course, all this is but another verse to a very old song. There was a strong Home Rule movement in Scotland after the First World War. There was the Covenant Movement after the Second World War which claimed some2 million signatures in support. But it goes further back than that. The debate in Scotland has been going on since 1707 and the heat that that debate generates in Scotland—and this is what all of us who are concerned about it must remember—varies according to the success with which the British Government and people are tackling their problems, social, economic and political.

Really the consistent feelings of the Scottish people about it all were summed up, simply but graphically, by the old lady—and we are still saying in the streets of Scotland much the same—in the Heart of Midlothian. You will remember a group of men were standing in the Royal Mile arguing about the reprieve of Captain Porteous and whether it would have stood good in the old Scots law. She had had enough of it and finally interjected: I dinna ken muckle about the law but this I do ken, that when we had a King and a Parliament and a Chancellor of oor ain we could aye peeble them wi' stanes if they werna guid bairns but naebudy's nails can reach the length of Lunnon". That is very much the feeling that has been going on and will go on according to the success, in greater or less strength, of British Government.

The fifth and final thing in my mind is just this: when one reflects on all that has happened and all that has been said in the area that we are have been concerned to debate in these two days, there appears a risk that the eventual outcome might be the break-up of the Union of 1707—the end of what when it was established, was the largest common market in Western Europe. That possibility has been widely canvassed by wise men in your Lordships' House, in the other place, in the Press, on the radio and television and in the streets talking to ordinary people. We must accept that possibility as a risk. We may differ as to which particular course is most likely to produce that result. I greatly regret that because I hold judicial office I am inhibited from expressing publicly the strong view I hold as to that. But in conclusion if by mischance—and I do not face this possibility with equanimity, as I gathered the noble and learned Lord Lord Kilbrandon, faced it, and I am sorry he is not here—it happened that those whose failures in political engineering produced it, successive Governments, and to some extent both of the two largest political Parties when in opposition, and others, would have to answer charges at the bar of history. And if the presiding judge there is any good, I would prefer not to be among the accused.

10.18 p.m.

The Earl of KINTORE

My Lords, like most of your Lordships, I am going to talk only about Scotland, with the exception that I should like to say how much I enjoyed the one Welsh voice that we heard from the noble Lord, Lord Heycock. I personally agree with him. If the Welsh decide they want devolution we should have a special Welsh Bill and not mix it up with the Scottish one. Perhaps I should declare an interest—I am never sure how far"interest" goes.

I should like to congratulate the noble Earl, Lord Minto, on his excellent maiden speech; he will see why in a moment. I am an elected councillor for the Grampian region. I am also chairman of the Water Services Committee of that institution and I have been 21 years in local government. That proves I am a thoroughly prejudiced chap! I am sure it was unintentional, but I do not think the noble Earl was quite fair to regionalisation. When the enormous increases in rates occurred last year people conveniently forgot that there were two" hairy"wage rises in the year before which had to be passed on. There was also a large amount of inflation. Not only that, but many authorities—and I am going to be careful—went on a spending spree and passed on their bills for the regional council to pick up.

It is quite true, as was stated, that in some cases there was a 100 per cent. increase in rates, but this is not a true reflection of what happened. If you look at the proportion of rates in the Grampian region, it will be seen that 45 per cent. of the regional rate goes for education, 16 per cent. for social services, 7 per cent. for water services, 8 per cent. for roads and only 4 per cent. of the total rate bill is accounted for by the headquarters staff running the whole of the administration, and the area we administer is of the order of 4,000 square miles. I do not think that is too bad. I have a dedicated and enthusiastic team of engineers working in my Department and I should like to point out that between one-quarter and one-third of them are Englishmen. So I think there are various things which might be said on that point, though I will not say any more at the moment.

A very wide range of views has been expressed today and there are so many defects in the White Paper that I believe it should be more or less scrapped and that Her Majesty's Government should start again. However, an Assembly must be produced, in my opinion. I favour devolution, but it must benefit the United Kingdom as a whole and Scotland in particular. My forebears were out in the '15 and some, again, in the '45; so perhaps I am not the right person to talk about this. But times have changed and so have views. What I think is no basis for any White Paper is political expediency, dogma or the paying of lip service to some electoral promise. The White Paper proposals, in my view, do not meet the necessary facts of the situation at all. I think the whole question needs rethinking. What is behind the clamour for devolution? Is it a genuine clamour, is it manipulated, is it just a protest, or is it a combination of all these? This must be decided by people who know more about these things than I do. Surely one should take an honest look at the electorate and at what makes them tick; that is the first step. We have to sell this Bill to the electorate and therefore we should have a look at the electorate before we start designing the Bill to fit them.

The majority of the present electorate never experienced the war except as children and, very rightly, children were extremely well looked after in the war. So far as Scotland was concerned, we had a very limited experience of the blitz up there. The children of those days have now grown up and their experience of hardship is really very relative. They regard welfare as a privilege to be demanded and not earned by hard work and the things that go with hard work. They are encouraged by the facts of life these days to go for the soft options.

The success of the Nationalists is worth looking at. At heart, most Scotsmen, sentimentally—and I include myself very much—are Nationalists. If there were a feasible, practical policy I should have very different views. Many recent opinion polls and quizzes have shown that a large number of people do not even know the names of the Ministers, let alone what policies they stand for, and Government finance is quite beyond them. When a political Party or a politician comes along with the glib statement," There is vast wealth in the North Sea which belongs to you. Westminster is pinching it. Vote for us and we will give it to you", the electorate is apt to vote that way, as I think is shown by the polls in the last Election. Greed, coupled with disillusionment with all three Parties, tempts them to try something new. The Nationalists have never been burdened with the responsibility of Office and, therefore, they have never let down the electorate as the other Parties have. Their time may or may not come.

The modern atmosphere in which many people have grown up and now live, of one-armed bandits, bingo, football pools, Spot the Ball competitions and easy money is character-forming. Boring things like thrift, honesty and hard work take a battering from the soft option life which many people lead. That is not to say that there is not a good solid foundation of worthy citizens—there is —and if they are properly led they are every bit as good as any of us were, and probably better. But they are not being led in the right way at the moment.

This is the background against which we look at devolution. It definitely must not be divisive, it must not be too expensive, it must not be merely a political device, it must not be subject to a veto and it must not add yet more government to Scotland. Those are some of the pitfalls which we must avoid. On the other hand, it should cut out the remoteness of Westminster from Scotland, should allow Scottish MPs who are elected to govern Scotland to do so, and relieve the workload of Westminster. It must also have powers on clearly defined subjects such as Scottish Bills, which have already been mentioned.

As a starting point, I should like to put forward something like this. I should like to combine Westminster MPs with local MPs elected in Scotland, and each Parliamentary constituency should have its Westminster MP and its local MP. They could be called by some distinctive name such as has already been mentioned, and with which I entirely agree. These Scottish MPs from the House of Commons and the locally elected ones should sit in Edinburgh and elect their own convenor. In order to cut out travelling, they could work two days before a weekend and two days after a weekend, and the following weekend they could work three days down here—not the locally elected ones, only the Members of Parliament—and three days on the other side of that weekend. There would be no more travelling than there is now, with members of Parliament buzzing about the place and then going to their constituencies. They would be able to spend more time in Scotland. The civil servants are largely in Edinburgh, anyway, and most of them could stay there. So far as I can see, very few extra civil servants would be required. If you limited the activities of the Scottish Assembly in the first instance to purely Scottish Bills, there would be no reason why purely Scottish Bills should be voted on by English Members of Parliament in London—and vice versa. When the Bills were passed they would have to come to your Lordships' House and the Government would have the same control and ability to amend those Bills here. As a last resort, there would be the delaying powers which already exist.

To my mind, this provides ample control over purely Scottish affairs. If we were to go ahead along those lines, we should get cracking very much more quickly than in any other way. If you begin with a solid foundation and build up gradually after you have gained experience, you have much more chance of a successful outcome than appears to be the case from the White Paper.

10.32 p.m.

Lord CLIFFORD of CHUDLEIGH

My Lords, do not look now but I am not a Scotsman! Your Lordships may remember that in the debate which I inaugurated on the problem of the South-West I made a point, taken up by the noble Lord, Lord Brockway, and others, that if Wales were to become a separate entity then, population-wise and problem-wise, we should also have our fair share of devolution. I used to maintain that these Islands should have had a federal system of government. Perhaps it is because of my Australian background and my dislike of centralism. If we had done this 100 years ago, perhaps we should not have the Irish problem today and the present canker of petty nationalism which is threatening the remnant of what was once Great Britain.

What saddens me most, again because of my Australian and New Zealand background, is that the Scots descendants in those parts of the world are, and were, the most loyal members of what is now called the Commonwealth. After all, it is a Scot called Fraser, now Prime Minister of Australia, who has brought back the National Anthem and other British connections—this despite the way that by their immigration Acts London Governments have insulted them over the last two decades.

I foresee no satisfaction coming from the present suggestions. I foresee a Scotland forever demanding more until they are an independent republic governed by the Glasgow conurbation, which, if I read the portents aright, is not what the rest of Scotland wants. I foresee an England, with 84 per cent. of the total population, called upon to shoulder all the international liabilities incurred by the whole, and then, in 15 to 20 years' time, when North Sea oil runs out, called upon to subsidise, as in the past. We are already bottom of the European prosperity league. In my own small neck of the woods we are full of Scotsmen and Welshmen—Robertsons, MacFarlanes, Bruces, Douglasses, Evans, Llewelyns, Jones—all of whom look upon themselves, and we look on them. as good West Countrymen. What will happen if devolution reaches its logical conclusion? Already our local fishermen arc protesting against the incursion of Scottish trawlers.

Way back in 1930 my father started his Australian company in Singapore and was invited to be the guest speaker at the local Chamber of Commerce and Industry dinner. He looked over the names of the members and officials and started his speech by saying he had just come from Europe via the Middle East, where he was very impressed by the Zionist Movement, which, as he understood it, was a Movement to get the Jews back to Jerusalem. He was about to start another movement to get the Scots back to Scotland so that the poor ruddy Englishmen could have a look in at business. In South Devon we jocularly refer to our neighbours North of Dartmoor as being of a different race and needing a passport to go there. So far as the Cornishmen are concerned, we say that they should cut their tails off before they cross the Tamar.

If devolution is to go ahead with Scotland and Wales alone I foresee that our friendly jokes of yesteryear will be the sick jokes of tomorrow. Lancashire alone has a greater population than Scotland. Everywhere I go today in this country I hear stories of local government over-manning, councillors putting in for excessive allowances, and so on. It is now proposed to add another tier to local government. Who is to pay for it? The dilemma is awe-inspiring. The fall of the Roman Empire took a couple of hundred years: ours is a gaderene swine gallop which can only be accelerated by the present hotch-potch proposals which are neither fish nor fowl nor good red herring—though if the affiliations of the founders of the Scottish Socialist breakaway Party are examined it will not be red herrings the unfortunate Scots are in for. The noble Lord, Lord Mackie of Benshie, said the Scots had a chip. My noble friend Lord Perth wanted £100 million a year from North Sea oil, which the noble Lord, Lord Rhodes, pointed out was not there. I maintain that fragmentation is on our doorstep and the English as usual are going to pay for it. Surely they are the biggest suckers this side of the Black Stump.

10.38 p.m.

Lord POLWARTH

My Lords, I am bound to say that I have a great deal of sympathy for the noble Lord who has just sat down, speaking, as he has done, as one of a minority. One of my noble friends said earlier this afternoon that the list of speakers reads to him like the roll of honour after the battle of Flodden. If I insist on speaking at this hour, I am afraid your Lordships must blame not myself but the business managers of this House for only allowing us two days for probably the most important debate we have had in the last 50 years, debating as we are the subject of fundamental reform in our constitutional arrangements. It is the duty of every one of us who thinks he has something to contribute to it—you may not agree that he has—to put his views forward to try to help us all to reach the best solution, not just in our own interests but even more in the interests of our children and our grandchildren.

I start with an affirmation of faith; namely, that I am in no doubt whatever that our first concern must be the maintenance of the Union, but this does not except the possibility of new arrangements for greater control over our affairs in Scotland. I ant proud of my ancestor who signed the Articles of Union in 1707 —a signature your Lordships will see in the Library. I am no less proud of my kinship through marriage with the late R. B. Cunninghame Graham who 70 years ago was campaigning for a greater say in the control over her affairs in Scotland.

Earlier today, in an outstanding speech such as one would expect from him on this subject, the noble Lord, Lord Home of the Hirsel, said that, quite apart from the political aspect of maintaining the United Kingdom, he felt that it was important that industry and commerce in Scotland should make their views clear on this fundamental subject. I cannot speak officially for industry and commerce in Scotland, but I have had over the years, and still have today, an intimate acquaintance with a great many people involved in it. I can say that so far I have still to find one single person in business in Scotland who would support independence—indeed, the very opposite. The Scottish Chambers of Commerce the other day made an announcement to this effect. I believe they must do it again and again if this is what they believe. It is the duty of those engaged in business in Scotland not to suppress their views, but to sound them loud and clear.

What is more, travelling abroad widely as I do, I have found a deep concern among those overseas with business interests in this country, including Scotland, at the possibility of a separate Scotland, not least, I may say, among the oil companies. They do not much like our British National Oil Corporation, but my goodness! it would be heaven to them compared with a separate Scotland. In France, which I visit, too, they see an independent Scotland as a threat to the newly found unity of the European community.

My Lords, Scotland depends for her prosperity on industry and trade, not on politics. Independence would ring the death knell of further investment in Scotland from outside its Borders, and even if oil were to bale us out for a few years, I am convinced that in a short time Scotland would suffer a sharp fall in her standard of living. I talk to quite a number of Scots, in all walks of life—I have time to do so now—and the great majority do not want independence in Scotland; and I believe that includes the majority of those who vote nationalist, and do not let us bother quibbling about separatism, independence, and so on because it is all the same. They are disillusioned by the remoteness of Westminster Government, and, rightly or wrongly, by its ineffectiveness and irrelevance to their needs. With this I have some sympathy. They want to try to do things better themselves; hence this sudden surge of feeling, boosted by the better times we have had lately in Scotland and by the prospect of North Sea Oil, however unscrupulously it has been held out to the people.

I believe something of the kind outlined in the White Paper is politically inevitable; the Assembly, its broad functions and the general organisation as set out are, I believe, as good a starting point as any we shall get. But as it stands—I think any of us who have been Ministers will recognise it—it bears all the marks of a typical internal power struggle within Whitehall and St. Andrew's House. Every Department has clung on jealously, clutched closely its share of the action, and the result produced looks a little like a chunk of meat set on by a pack of hounds, torn in all directions—in fact, a bit of a dog's breakfast.

On top of all this, to change the metaphor, we are saddled with Nannie Ross who firmly holds on to her new charge, determined to see it does not either disturb the grown-ups or start turning the contents of the toy cupboard upside down. We can really claim adult status for our new set-up, whatever it is to be. I would agree with virtually everything said by my former adversary who is not here now, and whom I can now call my noble friend, the noble Lord, Lord Hughes, on this subject. If you are going to have an Assembly, trust it, call its Ministers Ministers, because that is what they are. Give it full powers in its functions instead of carving them up between the Assembly and the Secretary of State, particularly so in the case of the Scottish Development Agency—an admirable concept, for the idea of which I fought for many years—but how would it function when half the members are appointed by the Secretary of State and half by the Assembly, and it is half responsible to each?

No man can serve two masters. For goodness sake!, let us think of those who have to deal also from outside these Departments and of the added complications that these divided responsibilities will bring. Also the Secretary of State, it is intended, is supposed to retain power over such matters as rents of Government factories, regional inducements to industry, even tourist promotion overseas. For heaven's sake!, what is wrong with a bit of healthy competition in these matters with other parts of the United Kingdom'? We have, after all, EEC rules governing the level of regional aids and inducements. Surely this should be sufficient to prevent a real price war on this front.

And if any basic service surely qualifies for control by the Scottish Assembly, it must be our ports. After all, they are firmly sited in Scotland and they handle our trade in and out. I can see no possible reason for them to remain under United Kingdom Government, except Mr. Foot's desire to keep his foot in them. I will not carry on the subject of North Sea oil, though I have a proposition on this I will put to your Lordships another day. We must, however, finally give the Assembly the opportunity to slim down and simplify our local government structure, the one we have just saddled ourselves with, as was admirably put to us by the noble Earl, Lord Minto, in a remarkable maiden speech. I believe that when we were in Office we made a great mistake in introducing this two-tier system of government and notably creating the region of Strathclyde. I believed so at the time, and in retrospect I might have salved my conscience better by resigning over it, but as your Lordships know, resignation seldom achieves very much. However, it is not too late. We are, I think, in grave danger of being overgoverned and saddling ourselves with enormous costs. I think the new Assembly should be given every opportunity to deal with this situation as soon as they can get round to it.

Let the Assembly get started without further waste of time. Let us get rid of the shackles to its operation. Do not let us go on discussing it ad infinitum or it will be too late. At the end of the day, however, its success or failure will depend on the quality of the people prepared to stand for it. On no account in this connection, I believe, should its duties amount to a full time career. Let it meet only for limited sessions, say for three sessions of six weeks a year, and leave time for people to be able to continue with other jobs, retain contacts in the world outside instead of being insulated in the hothouse of politics. Finally, I can think of no group of people who could play a more valuable part in this than those Scottish Members of your Lordships' House who devote so much time to its affairs and who have Scotland's interests so much at heart, as our debate today has shown.

10.49 p.m.

Viscount ST. DAVIDS

My Lords, I wish to speak as a Welshman, although inevitably some of my remarks will apply to Scotland. I wish to keep my remarks to the money side of this matter, in which I may be said to have an almost hereditary expertise, because my family, as Welshmen, have over a number of centuries been supremely successful at extracting money from the English. It started in Saxon times. The Saxons having taken our land we considered it eminently fair that we should have the arisings from that land, and we proceeded to take it from the Saxons. When the Normans took over from the Saxons we considered they had inherited the debt and we wenton raiding them in a most successful manner, and carried on until Plantagenet times, when most unfairly we were conquered.

The problem was merely changed; it did not go away. Unfortunately, the set-up which the Plantagenets produced was not fair to Wales. They gave us a Welsh Assembly, the Council of Wales at Ludlow, but the moneybags remained at Westminster. This was the trouble: the Welsh were at Ludlow and the English and the moneybags were at Westminster. So it remained until my Tudor ancestral cousin, the 11th great grandfather, marched with an army to Bosworth Field. We were there with a regiment of Welsh archers and put some very cogent points to the Government of the day, and the resultant change of Government was most successful: it resulted in the Tudors abolishing the Council of Wales at Ludlow and the Welsh politicians at last arrived at Westminster, where the Treasury was. There I consider, on the whole, we have done pretty well ever since. It is undoubtedly true statistically that the Welsh get allocated to them more than their per capita share of the wealth of Britain, and I believe the same is true of the Scots.

Now we come to the present proposals. We are going to have greater power at the periphery. I am in favour of that; that is fine. But where are the moneybags going to be? They stay at Westminster. If there is more power at the periphery one thing is quite certain: that the power of the Welsh and the power of the Scots as well will be reduced at Westminster. Will we get our fair share of what cash is going, as we get now? Personally, I do not believe it. I believe that any increase in self-Government in Wales or Scotland is going to lead to a decrease in the voting strength of the Welsh and the Scots at Westminster. That would not be to our advantage.

The position is much worse than that. What is allowed to Wales and Scotland must be allowed to England, and indeed to the English regions, as you have already heard from various noble Lords, including my noble friend Lord Clifford and the noble Lord, Lord Rhodes. They will all make their applications to Westminster for their share of Treasury cash, and, in fairness, I do not see how they can be refused. The trouble is that they are nearer to Westminster, and they are much more likely to be listened to. It is a plain and well-known fact among agriculturists that when it comes to which fields get the most manure it is the ones nearest the farmhouse. This happens. I cannot see that this spread of finance, as it will be in future with all these regional bodies, will benefit the Welsh and the Scots in the way it does now.

I think that this proposal is terrible. I believe it to be a disaster for the Welsh in particular. I certainly cannot see myself marching under a Welsh Nationalist flag marked with the letters,"Back to bloody Ludlow". It is impossible. The Welsh have fought for centuries precisely not to have this state of affairs. If this arrangement is ever set up, it will be a disaster for Wales and a disaster for Scotland, and it will not be for the health of Great Britain. I am therefore totally opposed to it.

10.55 p.m.

Lord MOTTISTONE

My Lords, I am half Scots, quarter Welsh, quarter English and I am married to a girl from Northern Ireland, so I can be said to be a Unionist absolutely to my backbone. Indeed, for this reason I have the same misgivings as the noble Duke, the Duke of Atholl, has expressed about these proposals. However, I fear that we have gone too far and that we have to go ahead with something on these lines. It has been my privilege during the past six years to travel all over Great Britain—and to Northern Ireland, but that is another matter—from Lerwick down to Truro, and from Norwich across to Llandudno, and I have covered a lot of the territory between. The most important thing about the people I have met, and in the main they have been businessmen, has been that they are all fed up with over-government from Westminster and Whitehall. This point has been made by other noble Lords and I will not labour it at this late hour.

I suggest to the Government that they are tackling the wrong horse. The problem with this country is over-government as seen by the people out in the sticks, and the further one goes from London the more obvious this becomes. What the Scots have done—and the Welsh have gone along with them—is to react to this situation because of their history. Indeed, because of my Scottish ancestry, I was brought up to hear about Robert the Bruce before I ever knew of Shakespeare, and I suspect that the same applies to every Scotsman. The Scots have a background and a" something positive" through which to express their objection to over-government from this part of the country. I strongly suggest, therefore, that it is most important for us, even in the short-term, to examine more closely how we can reduce this degree of over-government.

I am not making a Party political issue here. It is true that those on the Benches opposite are more inclined to intervene in the affairs of the people, hopefully to make them do things better, than perhaps we are, but there are other factors which are important. There is the fact that since the last war there have been offshoots of central Ministries all over the country; for example, an office of the Department of the Environment in Manchester, and so on. We should examine whether this proliferation of central Government out into the sticks is really justified in all cases; whether, now that we have sorted out local government —I know this does not please everyone; it certainly does not please the Scots—local government can do more on its own account without having Assemblies and the like in Edinburgh, Cardiff and possibly in other parts of the country. We need to tackle the problem at its roots and see how we can govern our country in such a way that people feel that they are not unnecessarily overburdened by the effects of bright ideas from Westminster, put into effect on the advice of bureaucracy which has a natural feeling that it must do things itself rather than decentralise them.

The other point I would make is that it seems to me in reading the White Paper that it is written entirely from the point of view of the central Government system—that is, that of the Whitehall Ministries and the Parliamentary people who support them. I put it that way round because I believe that to be the way we have gone now. Little or no account is taken of what might be called the business and commercial point of view. I suggest most strongly that, before we embark on this escapade—and I believe that it is an escapade—we should try to see whether we can make quite certain that, as the noble Lord, Lord Rhodes, pointed out—and he is perhaps the only speaker who has said this—we do it as efficiently as possible and for the benefit of those who make the money to enable us to keep going and to sit in this beautiful Chamber.

It is essential that the business point of view be raised. I suggest that businessmen in general were taken by surprise by this matter and that they rather let it go. Perhaps they are to blame, but I believe that there are all sorts of matters in the proposals which could be modified if a business point of view were brought to bear on them. I emphasise that that and the need to take government off the backs of the people are the real roots of what is required, rather than bothering about the particular problems of the Scots and the Welsh.

11.2 p.m.

The Earl of MANSFIELD

My Lords. I should first like to thank the noble Viscount, Lord Thurso, for allowing me to speak before him at this stage of the debate. Unlike the noble Lord, Lord Belhaven and Stenton, who told us that, like Young Lochinvar, he came out of the West, I, if I can get the train, intend to direct my attention to the East. It is therefore kind of the noble Viscount to allow me to go in front of him and, if I do not stay to hear the words of wisdom of the noble Lord, Lord Kirkhill, I hope he will acquit me of rudeness.

This has been a debate in which there has been a great measure of agreement. Certainly, so far as noble Lords are concerned, there has been agreement that nobody wants any action to be taken in the future which would in any way infringe the essential unity of the United Kingdom as at present composed. Equally, there has been agreed between all of us the great importance of this debate to ourselves and everybody in the Kingdom outside the Palace of Westminster. It will create a great deal of trouble and thought throughout the United Kingdom in the course of the next few months and years as to whether what we are doing is right or is the best thing in the circumstances. The noble Lord, Lord Shepherd, twitted us on these Benches on being in a state of some disarray. But I make no apology for that: anybody who attended or read the report of the four days of debate in the other place would have been able to count on one hand the speakers who approved of the Government's White Paper. It is a fact that disarray exists in both the major Parties in both Houses of Parliament. There is of course no instant solution to the problems which confront us, and the more one considers those problems the more difficult they become. I believe that what we are agreed on is that, if we act hastily or unwisely, the United Kingdom may well fall part. As was said most graphically by my noble friend Lord Kinnaird, if it does fall apart, never again will it be stapled together.

This debate and the consequences which follow may have a considerable effect on your Lordships' House. With the possible exception of my noble friend Lord Kintore, I do not believe that any speaker has considered that point. By way of illustration, under paragaph 59 of the White Paper, if the Government wished to move a Motion because they considered that a Bill coming from the Scottish Assembly was against general policy, what would be the position of your Lordships' House if we were to try to follow the expressed desires of the elected representatives of the people? In those circumstances, would the Scottish-based ones go for the tribute in the Lower House, in Parliament here, with the elected persons in Edinburgh? It poses a problem. I rather liked at first blush the idea of my noble friend Lord Kintore, that your Lordships' House should be, as it were, the Second Chamber for the Scottish Assembly. But one has to doubt whether the likes of Mr. Sillars would care for us to turn ourselves, for these purposes, into a sort of House of Lairds. I do not think that that would be an entirely popular procedure.

Furthermore, if there are meaningful Assemblies in Scotland and Wales, what will be the position of noble Lords who are Scottish? They may be Scottish by birth and breeding, like myself. They may have Scottish titles, which I do not. Are they to be excluded? It seems to me—and I have not had time to consider this point in depth—that when one starts constitutional change it may well go very much deeper, and in much wider directions, than when one first considers the problem.

It is worth postulating how we, as a country, come to find ourselves in the present difficulty. Reflecting on my own adult life-time, I can remember all too clearly when Scottish nationalism was a joke. People painted slogans on the roads and on corners of buildings. I remember when, in 1950, the adherents of what was the precursor of Scottish nationalism purloined the Stone of Destiny. They offered it to my late father for custody. I recall that they came at the dead of night to the house in which we were then living. My father had 'flu; nevertheless, he got up and greeted them at the front doorstep. It was a very cold December night. He was offered the Stone, but he turned it down, saying that he had sworn an oath of allegiance to Her Majesty and that was what bound him. Then the conspirators asked him if he would report them to the police, and he said, No, he was not a Campbell—

Lord BELHAVEN and STENTON: My Lords, I apologise to the noble Earl for intervening, but I just entered the Chamber as he was saying something which very much interested me. Exactly the same thing happened to my father, and he said he would surrender the Stone to the Lord Lieutenant of the county, which I think was the correct way of doing it in those days.

The Earl of MANSFIELD: I wonder, my Lords, who was approached first? One has to ask oneself, when one reflects on the slightly comical aspect of the history of the Scottish Nationalists in 1950 or thereabouts, how it comes about that so much support has, in the space of a comparatively short time, flowed to them and to the cause that they espouse, especially when one considers that although the very early Parliamentary support for the Scottish National Party came from the central belt, in more recent times it has come from the agricultural areas, and certainly the non-urban areas, in Central and Northern Scotland. These are places where, if they ever stop to think, they would, I suspect, probably be advantaged least of all from an Assembly dominated, as it would be bound to be, by townsfolk from the West-Central conurbations.

One has to ask oneself what has caused the minority view of a small pressure group to become what is, according to the opinion polls, now a majority view. It is a question which should be asked and which deserves an answer. It may be that it is a result of a combination of circumstances which I think have come from a long history of mismanagement and misgovernment. I do not point the finger of accusation at either one Party or either Party; I think it has come about from, perhaps, both Parties. During the 1950s—I think one has to face it—there was held out to the public a vision of material affluence; again going back in history, noble Lords may recall, not so very long ago, advertisements showing an attractive young lady lying near some central heating pipes—she was described as" Mrs. 1970"—and the advantages which would accrue if she installed oil-fired central heating. It seems an age away, but that was the sort of advertising which hit us as it were, in the 'sixties.

Scotland, alas!, was not in the golden triangle. Unemployment remained high as compared with other parts of the United Kingdom. The sense of remoteness, of being far from the hub of the Kingdom, remained. Governments created small, but nevertheless important points of rancour and dissatisfaction. The noble Earl, Lord Perth, has already referred to the disastrous A9, which fills all good Scots with fury whenever they have to drive on it, but there are also others. Even when the Forth Road Bridge was created we had to pay, and we ever since have had to pay, a ridiculous toll for going over it. When trying to fly to and from Eastern Scotland by air, the airport is so ill-equipped at Edinburgh that one has to wait for a fair wind before the planes can come in. It is matters like these that I think have created a possibly unjustified but nevertheless very natural resentment against all things that seem to emanate from London.

One must not forget that in the course of the last few years there has been a spirit of envy abroad. I know that the Labour Party would say that it stands for redistribution; others might call it something quite else, but it certainly has, as it were, impinged on the consciousness of the community that if one does not have something and somebody else does, then it is one's right to demand a share of it. This brings me right up to date. When there came the discovery and the harnessing of North Sea oil, it was inevitable, if not natural, that the Nationalists, who had been looking for a catalyst to express their dissatisfaction with all things connected with the United Kingdom, should seize on this amazing benefit of oil and have, as it were, stilled every doubt by wild over-enthusiasm. They have counted chicks, not only before they were hatched but even before the eggs were laid; the result of course being that everybody in Scotland is now told, and many believe, that the answer to all our troubles will be the oil and the riches which flow from it.

So, my Lords, so far as devolution is concerned, we are left with a situation which cannot be ignored; indeed, it cannot be wished away however desirable that course might be. We have to live with the fact that at least for the moment Scotland has a political Party which is hellbent on separatism; that is, a separate, independent country. At least, I say that because I for one was waiting, if not on tenterhooks, with a considerable degree of interest, to see what the noble Lord, Lord Belhaven, would say as to the precise stance of the Scottish National Party; but I fear that after his otherwise agreeable speech I was no wiser.

Lord BELHAVEN and STENTON

My Lords, I am sorry to interrupt the noble Earl, for the last time, but I put myself down to speak tomorrow. If I did not make myself entirely plain, I apologise but I did not expect to have to speak today, and I came in by air.

The Earl of MANSFIELD

My Lords, I entirely acquit the noble Lord of trying either to deceive the House or to treat it with less than courtesy, but I am still bound to say that after his speech the attitude of his Party was no more plain than it was before he rose to his feet; that is my point. The question is this. Does the Scottish National Party wish to have a separate, independent Scotland as a separate sovereign State, or does it not?

Lord BELHAVEN and STENTON

My Lords, that is a question which I think I must answer in the affirmative—not in a great hurry, but in the affirmative, Yes.

The Earl of MANSFIELD

My Lords, this coyness ill becomes the noble Lord: but at least we are not peering through the glass so darkly as before. It is in the light of the noble Lord's last statement and the present situation in Scotland that we have to review and consider the Government's proposals as set out in the White Paper. It is in that light that these proposals must be judged. It is plain, I think, that the White Paper is already out of date. I suspect that at the time when it came to be drafted, the Government at any rate were under two illusions. First, if an Assembly were set up it would have an in-built majority from one Party. I hope I shall not be considered too contentious if one imagines it would be the Labour Party. Secondly, at the time when the White Paper came to be drafted, I have little doubt that the Government considered, quite honestly and naturally perhaps, that the demand for separatism, and therefore much of the support for the Scottish National Party, would melt away so soon as what apparently seemed to be a firm and respectable policy of devolution emerged from the White Paper. Both views, if they existed, have now been exploded.

The Assembly is likely not to have any in-built majority at all; but in my view it is the only logical way in which this White Paper can be read. It is the only way in which an Assembly and an Executive and the officers of the Executive as visualised by the Government, could possibly work; so that if, for instance, there were a Labour Government in power in Westminster the Scottish Assembly would be a reasonably tame animal—I will not say" a poodle"—with a Secretary of State as some form of satrap presiding over the outcome of its deliberations. If there was not a Labour Government then at any rate the Government of the day at Westminster would have to work along as best they could with such an Assembly.

The likelihood is that, at least in the early stages, there may be some form of coalition of nationalists representing political viewpoints which possibly in the normal course of events would be totally opposed to each other, but because they will be satisfied—as at last we have discovered and as we suspected before—with nothing less than a form of independence, they will come together in unholy alliance. In my view, therefore, it is likely that the Assembly, at least in the early stages, will be dominated by the Scottish National Party. It will be only when the present grievances, real or imaginary, die away that a sensible measure of devolution will have its natural political effect, normal political differences will reassert themselves and the desire to preserve the integrity of the United Kingdom will once more become paramount.

It is, therefore, a risk—and a real one—that if too few powers are devolved, the outcry will merely be intensified and whatever arrangements arc made will be regarded merely as an insult. Alternatively, if sufficient or too much power is given to a Scottish Assembly, the chance will be taken to fight and gain a measure of independence. It may be that, if some form of proportional representation were adopted by way of election to the Assembly, this danger might be diminished or removed.

A number of noble Lords have expressed an interest—I think that is a reasonable construction on their remarks —in proportional representation. I have examined the German lists system which may well be the choice eventually for the European Parliament. It has certain advantages, in that a proportion of the candidates may be elected by our present system of what I call" first past the post". A number of other persons can be elected to the Assembly who would be elected from lists produced by the major parties on a proportional system. It would have the advantage that persons might be attracted into the Assembly who would not undergo the hurly-burly of the hustings—academics. and persons such as that—and it might achieve a rounder membership than an ordinary British-style Election might provide.

Be that as it may, whatever the political constitution of the Assembly, fledgling assemblies are always pervaded by a heady excitement coupled with a desire for more power. The European Parliament is an example of which I have had some experience. Even without a whiff of nationalism, there is bound to be friction between Edinburgh and Westminster to some degree. The Government must rethink both the checks on the power of the Assembly and the manner in which they are to be applied. What is to be the position so far as legislation is concerned which the Government consider to be against their general policy? I cannot see any political system will survive for long if there is this form of veto which will depend purely on the Government's majority in the House of Commons at any time. I wonder what the eventual consensus will be—because consensus there will have to be—over the establishment of whether any proposal on the part of the Assembly is ultra vires. I should have thought that this was something which would of necessity entail judicial review, and that this is something which the judicial committee of the Privy Council could well undertake. It is a body which is respected by all. It certainly could have, if it were thought desirable, the addition of more Scottish judges when these questions came to be decided.

As to what functions should be devolved, the Government have to devote more time to the matter. There will have to be more given away regarding agriculture, housing finance and the Scottish Development Agency. There will have to be a better idea as to how revenue is to be given than the allocation of a block grant, whether it comes from oil revenue or whether we have a penny on a" tot" of whisky, whether we have a sales tax or whatever is provided; it will have to be better and with more discretion so far as the Scottish Assembly is concerned than the present proposals.

At the moment on this White Paper the Government could not produce a Bill which would have the slightest chance of getting through the other place. That is absolutely apparent from the four-day debate which took place there. Therefore when the noble Lord, Lord Shepherd, said—I hope I am not being offensive if I say, with a touch of smugness—that the Government are prepared to make changes where they fit sensibly into the concept of the White Paper, I fear there will be no changes made unless the White Paper is changed; so a more sensible concept is to produce something to show how we can have a measure of devolution which will fit in with current political thinking. I take the point of noble Lords who have said in different ways that if we have more haste this time we shall have less speed in the end. We have to get a Bill which will command general support, at least in principle, throughout the other place. It might be there will be political differences which will manifest themselves over the details; but in my view there has to be some form of general support for a Bill which must be, as it were, promised to the Government before Second Reading: otherwise there will be nothing other than a prolonged state of disagreement and disarray.

I hope this can be done quickly because, although it is interesting and indeed highly important to debate these matters of devolution which concern us all, I do not think they are really what this country ought to be thinking about. This Government have made immense political and Constitutional changes since taking Office in 1974. What we really need to debate in your Lordships' House and elsewhere are, for instance, the power of the State, the interests of the individual, the mixed economy and what part the private sector is to play. We must ask: where is the cash to come from to finance it; where are the rights of the individual to reside, and who is to oversee them?

Our whole way of life has been turned upside down in recent years. It may not be a bad thing and it may be that this is something which is inherently desirable. I should like to see a measure of devolution as quickly as is sensible, but I am very conscious of the need for prudence. After that, we can get back to the real debate and try to enrich our lives and those of all the subjects within the United Kingdom.

11.27 p.m.

Viscount THURSO

My Lords, hope that by standing aside I have enabled the noble Earl, Lord Mansfield, to cover the road and the miles to Dundee in time for his appointment. But I am a little puzzled—and perhaps at a later date he will be able to enlighten me about it—as to why he disclaims a Scottish Peerage when he bears three Scottish titles, under any of which he could sit in your Lordships' House. He has one Great Britain Earldom and no United Kingdom titles at all. However, these are semantics. What we are concerned with today is a very important constitutional discussion which will, I hope, contribute to the future shape of Parliament in Wales, in Scotland and here.

I was delighted to hear front the noble Lord, Lord Shepherd, that the proposals contained in the White Paper are not a last word. I feel that this statement has been corroborated by the act of Her Majesty's Government in recalling the noble Lord, Lord Crowther-Hunt, to the team. I am delighted to see him here. We have bandied many words on devolution across the Floor of your Lordships' House; and although we do not always agree, and although he does not always understand what I say and I am sure that I do not always understand what he says, nevertheless I have great confidence in his integrity and in his real desire to see a sensible measure of devolution evolved for Scotland and Wales, for the benefit of England and the United Kingdom and the strengthening of the Union. I really believe this, and I think that the fact of his having been chosen to return to the team is a reflection of this fact. At this stage I can only wish him luck and shall hope to listen to him tomorrow.

What has impressed me, and I am sure it will also have impressed all who have listened to this debate, is the number of blinding lights that have been seen on the way to Westminster tonight. The conversion in particular of the noble and learned Lord, Lord Hailsham of Saint Marylebone, to an almost pure Liberal view, and the able way in which he put forward the Liberal policies which we from these Benches have been putting forward for so long, was a delight to the heart—

Lord HAILSHAM of SAINT MARYLEBONE

My Lords, I am sorry to disappoint the noble Viscount, but I am bound to tell him that I wrote and published most of this about 1964 and, as my noble kinsman Lord Aberdeen and Temair reminded the House, I broadcast it as long ago as 1969; so the conversion on the way to Damascus has not been of immediate recency.

Viscount THURSO

My Lords, I am very glad that at last the noble and learned Lord has had the courage of the convictions which he has held for such a very long time, and has put them to your Lordships so cogently and clearly. Indeed, he has drawn our attention, as have many other noble Lords, to the fact that it is no longer possible to keep the status quo. He has said, as have many of the noble Lords who sit behind him, that he is now for true devolution with a separation of powers and a federal solution. I like his conversion to the written Constitution, to the Bill of Rights, and the conversion of many other noble Lords—indeed, I would say, in the first half of the debate a clear majority—to proportional representation, which is an essential tool in getting a proper devolution for Scotland.

I must take up one point with the noble and learned Lord, Lord Hailsham, about the ability of the United Kingdom to defend either itself or Scotland. I wonder whether this is in fact true. The Royal Air Force is at the moment, in terms of front line aircraft, 12 per cent. of what it was in 1958, and the percentage of what it was in 1939–40 must be in single figures. We have to remember that the ability of the Royal Air Force to defend us against the might of Germany was very largely due to the backing of the British Empire, and the power and influence which that gave us. This we do not now have. And we must remember, in seeking solutions to our problems of government, that we are part of NATO, that we are part of Europe and that all our solutions depend upon NATO and the European Community holding together as defences for any institutions that we may devise and cherish within these Islands.

This point was most ably made from these Benches by the noble Lord, Lord Gladwyn, who pointed out the importance of the new European context in any thinking on devolution for Scotland, or on devolution within the United Kingdom. It is because we had joined Europe that, whether or not we had struck oil, the argument for devolution became stronger. It is because the United Kingdom must start looking towards the part which it intends to play in Europe that we have to think about devolving the smaller, more intimate functions to the parts of the United Kingdom. It is because we have to show that we can become part of a political union within Europe that we have to show that we can run a political union within the United Kingdom, here in these Islands. It is most important that we should remember this in devising the new institutions, and in revising our old institutions, which we use in trying to govern ourselves as we go into Europe.

The noble Lord, Lord Mackie, speaking from these Benches, pointed to the lack of understanding and the puzzlement of the English. This is in fact a very real thing. I believe that people in England have for so long not been exposed to the problems with which those of us who live in Wales or Scotland have been grappling for a long time, that they tend to feel that this is a new phenomenon; that this has something to do with the discovery of oil under the North Sea. But this is not so. It has been of importance to Scotland for more years than I have been on this earth, and it has been of growing importance to Scotland, as we have already pointed out, as we have moved into Europe.

The noble Earl, Lord Minto, contributed a most excellent maiden speech to your Lordships' deliberations today. I should like to join in congratulating him upon it and to say that we in your Lordships' House shall look forward to hearing from him again regarding his experience of local government. He drew our attention to the fact that regionalisation was"an expensive mistake"—I think those were his words. It was an expensive mistake to make if we believed that we were going on to a form of devolution. If the Commissions which considered the reorganisation of local government and the Constitution of the United Kingdom had at the same time considered the relationship between the two problems, very different recommendations would have been made.

It is most important that we should remember that this problem must be solved; it will not go away because either we create or do not create an Assembly. We shall have to reconcile the role of local government with the role of the Scottish and Welsh Assemblies, and we must put our confidence in the new Assemblies to bring about this reconciliation. This reconciliation must be brought about at the local level and with an ear to the local ground. This is one of the points in the White Paper which must be looked at by Her Majesty's Government, to ascertain whether the power of the Assemblies in relation to the reorganisation of local goverment needs to be strengthened.

The noble Lord, Lord Hughes, and many other noble Lords, too, drew our attention to the fact that there would be great danger in half-hearted devolution. The devolution process must, he said, be real. This is absolutely paramount if it is to be made to work. In this context it is unfortunate that the words "block grant" as a means to supply finance to the devolved Assembly in Edinburgh have been used. The very idea of it being a grant is an unfortunate choice of words. We on these Benches would rather that the Assembly were invested with the ability to raise money, perhaps by some form of taxation. We would rather that the Assembly should be given, by right, a share of the revenues, perhaps from oil or from other resources created within Scotland.

We might consider whether or not it would be better for the Assembly to promote a budget which it would bring to the Parliament at Westminster to try to obtain a requisition which was related both to the cost of the projects which it felt were necessary and to the priority with which it regarded those projects, rather than that the Assembly should simply be given a slice of cake which might bear no relationship to the priorities according to which it would then distribute the pieces. This is an important point which we ask Her Majesty's Government to look into, for the way that money is provided to the Assembly may very well determine whether or not the Assembly becomes a workable instrument of Government. Indeed I do not go along with the White Paper where it says that taxation throughout the whole United Kingdom must necessarily be uniform. I think it is possible that it might be desired to use taxation as a tool of encouragement or discouragement to certain aspects of Government, and there should be machinery whereby this can be effected.

One of the encouraging things about this debate has been the unanimity with which certain points came cross. A complete unanimity that, by setting up Assemblies in Scotland and Wales, we are not trying to shake the unity of the United Kingdom. I have always maintained this: I have gone on record in your Lordships' House as saying that I believe the unity of the United Kingdom can be strengthened, not weakened, by giving greater control over Scottish affairs to Scotsmen in Scotland. I was delighted to see that there was a real unanimity about this throughout the debate in your Lordships' House.

I think there was a certain unanimity in criticising the White Paper on the grounds that the functions devolved to the Assembly should be complete functions and should not be partial functions, partly checked and controlled by a Secretary of State and partially checked and controlled by the Assembly which has been put there to control these functions. There was also a fairly wide measure of agreement on the important points made by the noble Lord, Lord Mackie of Benshie, that these functions should include industry and agriculture. I would add to that also the activities of the Highlands and Islands Development Board, and perhaps if I may enlarge upon that one it will demonstrate how curious is this division of completeness.

In paragraph 139, the Highlands and Islands Development Board is to be made a child and a creature of the new Assembly in Scotland. They are to appoint the Board, to appoint the chairman, and in most matters—in fact in all devolved matters—to be responsible for its actions. Yet the most important actions—the actions for which the Highlands and Islands Development Board was originally set up—are to be specifically reserved to the Secretary of State, who will not have appointed the Chairman, nor the Board. This seems to me curious and to be one of the things which can be put right during the rethink which was promised by the noble Lord, Lord Shepherd. I think also the inclusion of greater control over industry and agriculture could well form part of this rethink.

One of the most satisfying features of this whole debate to someone sitting on these Benches was the very wide acceptance all over your Lordships' House of the vital importance of proportional representation. Obviously, it is very nice when something that you have always said ought to be considered suddenly becomes acceptable to people whom you respect, even though you may not agree with them. It is undoubtedly widely conceded that if it is desired to devolve legislation to Scotland, the process by which the legislators arrive at the Assembly must be real and effective and they must be seen to be answerable to the electors. It is quite clear that only proportional representation will do this effectively.

Indeed, I would claim that, if proportional representation had existed and had been used in Elections to the United Kingdom Parliament, there might very well not be such a strong case now for devolution, because the electors of Scotland and Wales might feel more directly in control of their Members of Parliament at this time. But that is idle speculation because we have gone on far beyond that point, and have now reached a point at which there will be no going back. We shall require an Assembly, and this must be made effective. It must be elected in such a way that the electorate have confidence in it. I do not think it is a good idea to have nominated members; I do not think it is a good idea to have outside Executive members. If you believe in your Assembly, elect the right people by the right method, have confidence in them. Let them elect the people whom the electorate think will do the job for them, and let your Ministers do the job. That is another word that I could not agree about; it is important to use the right word in talking about the Assembly. If you get the right members in your Assembly you will get the right material for your Ministers.

My Lords, the only unfortunate thing about the whole debate, the whole consideration of an Assembly for Scotland, is the fact that the conversion of so many people has in fact come for the wrong reasons. There are far too many people supporting an Assembly for Scotland and for Wales because they are afraid of the alternatives. I support an Assembly for Scotland because I believe in what it will do. We on these Benches support an Assembly for Scotland because we believe it will be a tremendous step forward in the political life of the whole United Kingdom. We congratulate Her Majesty's Government on having brought forward this White Paper. We congratulate them on their willingness to discuss it at this point. We offer any help we can give in trying to improve the shape of the Bill, both at this stage and when it eventually comes before Parliament.

We congratulate Her Majesty's Opposition on so widely coming round to views which we began to think we were the only voices in the wilderness propounding. Some of their views are truly Liberal, with a large and a small" L". We hope that Her Majesty's Government will be successful in getting the Bill forward in good time, not in any Gadarene rush, but in good progressive time so we can support them. The noble Marquess, the Marquess of Aberdeen and Temair, asked, Is the time right?". I would say to him: the time is right if the measure is right. I think the measure is right now to have an Assembly in Scotland and in Wales.

11.49 p.m.

The MINISTER of STATE, SCOTTISH OFFICE (Lord Kirkhill)

My Lords, the hour is late as we enter the last stage of this evening's debate on the important question of devolution. In introducing my remarks, I am sensitive to the great intellectual balance and moderate view, which may well have set the tone of subsequent contributions, expressed by the noble and learned Lord, Lord Hailsham of Saint Marylebone, at the outset this afternoon, eschewing, as he did, acceptance of the Scandinavian solution. I am conscious also of the very clear and typically down-to-earth expression of very Scottish aspiration evinced by the noble Lord, Lord Mackie of Benshie. I am aware also that the debate has had a distinctively Scottish bias; perhaps Welsh redress will occur during the discussion in the course of the second day of the debate.

Those recommending devolution are faced with the military strategist's nightmare, a war on two fronts; on the one hand, against those who want to proceed further and faster, on the other against those who hardly want to proceed at all. I should like to devote most of my remarks this evening to explaining further the Government's proposals on finance and economic powers, and thereby, as far as possible to concentrate on one enemy, so to speak. The great majority of those applying themselves to criticism of the financial and economic proposals seem to want them to go further.

I start with the Government's proposals for the financing of the devolved Administrations. In both cases this will be by block grant supplemented, when necessary, by a surcharge on local taxation which, meantime, means rates. I stress these words" when necessary". I have to admit that criticism, indeed contempt, has been poured on the suggestion for a surcharge on the rates. But these proposals cannot be understood or appreciated unless it is recognised that the block grant is intended to cover in full the needs of the devolved Administrations as assessed in discussion between them and the Government and in debate in Parliament. The size of the block grant will not take account of any sum the devolved Administrations might raise through a surcharge on rates. They are not expected regularly to make such a surcharge, though they will, of course, be free to do so if they so decide. But as the Government sec it—I want to emphasise this—the surcharge on rates should happen only occasionally, if ever. I will return later to the reasons for the choice of rates as opposed to some other tax as a means of occasional supplementary revenue.

Choice of the block grant reflects the fact that, if each part of the United Kingdom was left to depend wholly, or even in large part, on the taxes that happened to be raised within its boundaries, some would either have to have very much higher taxes per head than others, or would have very much poorer services. The whole purpose of devolution is to allow areas with distinctive circumstances, characteristics and ambitions, to meet their needs in their own particular way and according to their own assessment of relative priorities. But social justice and good political relationships over Great Britain as a whole demand that, as far as possible, each area in Great Britain should be put in the position of maintaining a quality of life broadly comparable overall. It follows that the Government must assess the comparative needs of different parts of the United Kingdom and must be in a position to redistribute United Kingdom resources as a whole, so as to even up the differences which would otherwise occur in the total quality of life as between one area and another. I think there will be little if any argument about this.

But there has been a great deal of argument as to whether the admitted need to even up standards between one area and another required the Government to make themselves responsible for raising all the money the devolved Administrations needed. Clearly, many think that this will restrict the freedom of the devolved Administrations to spend whatever money they got in ways of their own choosing. Others obviously feel that it will be difficult for an Administration to cultivate any sense of financial responsibility if it does not itself have to raise any of the money it spends.

My noble friend Lord Hughes said that it is highly desirable that a devolved Administration should be in a position to raise the money needed to make effective the legislation it passed. He was good enough to acknowledge that he has was far from clear how this could be achieved. I hesitate to give a definitive answer now, but I suggest this is one objective we cannot and must not try to achieve. It could be achieved only by a fully sovereign State. Short of independence, I think it is inconceivable that, say, the Scottish Administration should be in a position to set the total level of expenditure by the legislation it passed. Conversely, it would be undesirable to have Parliament overriding devolved legislation simply because it feared the level of expenditure which might result. Within the framework of the United Kingdom there seems no alternative to the Government having the larger part, if not all, of the say in how much of United Kingdom resources are made available for each area.

I suggest it is a mistake to suppose that the devolved Administrations would have more freedom of choice if they were regularly responsible for raising part of the money they spent. Whatever their local taxable resources were, the Government would be bound to take account of them in assessing how much topping up finance they would provide. Whatever analysis of needs took place in order to provide the block grant as conceived in the Government's proposals, exactly the same analysis of need would be necessary in order to assess the amount of topping up finance because, obviously, it would be the Government's objective that the resources from locally appropriated taxation and the topping up finance together would amount to the same sum as the block grant would amount to under the Government's present proposals. Once the total sum available to the devolved Administrations had been decided, they would in either event have complete freedom to spend it as they thought best.

Lord MACKIE of BENSHIE

My Lords, do I understand the noble Lord to say that unless the Government of the United Kingdom approve, then the devolved Assembly could not raise more money for a specific object? Is that what the noble Lord is trying to say?

Lord KIRKHILL

My Lords, I do not think that I was making that point. I was suggesting that no matter whether one looks at it from the point of view of permitting the devolved Assembly to raise the level of the money it needs to meet the standard of its own legislation on the one hand, as against central Government on the other hand topping up, a measure of control must inevitably lie at the centre. This is the point I am attempting to make.

Lord MACKIE of BENSHIE

My Lords, that does not meet my point.

Lord KIRKHILL

My Lords, I think we are at cross-purposes. However, let me go on, and the noble Lord may begin to agree with my point or not. In other words, they would get no more money, they would be subject to no less scrutiny by the Government, and they would have neither more nor less freedom in spending the money by one method as against the other. In terms of providing freedom of choice for the devolved Administrations, giving them regular, substantial powers of taxation is, in one sense, simply irrelevant.

There are of course some in Scotland who do not see it this way. They rest their case on the prospective income from oil and argue that, in the quite near future, Scotland, if it were left the use of what they choose to regard as its own resources, would need no subsidy from elsewhere and would gain no benefit from the arrangements I have been describing. But the Government are not thinking of the interests of a particular area at a particular point in time. They are concerned with the long-term interests of the United Kingdom as a whole. Scotland has in the past been dependent on the general financial resources of the United Kingdom. Natural resources are from time to time found in a variety of places and they may make a significant difference to the prosperity of particular areas. But their effect is usually to a greater or less extent temporary and the effects of the oil finds may be more temporary than most. The Government are glad that the great majority of the Scottish people show no signs of wishing to take for themselves all the benefits of the oil discoveries, after many years during which they have enjoyed some of the benefits of the discovery of natural resources elsewhere in the United Kingdom. This the Government feel is to the credit of Scottish feelings. The Government are sure that continuing as part of the United Kingdom will be to the benefit of Scottish material and other long-term interests. Total appropriation of the oil revenues for Scotland would of course imply a completely independent tax system, a completely independent economy, a completely independent State.

But even some of those who reject independence and who have no wish to claim all the oil for Scotland sometimes suggest that some sort of arrangement should be made whereby a proportion of the oil revenues would be allocated to Scotland. Indeed, the noble Baroness, Lady Tweedsmuir, emphasised that point earlier in the debate. If those who take such a view accept that the United Kingdom should continue as such, they are presumably not suggesting this as an arrangement for Scotland only; they are presumably arguing that every part of the United Kingdom should be entitled to a percentage of the revenues from any natural resources happening by chance in its area.

But how do we work this out? What is the percentage? I presume it would be agreed that it should be the same percentage in every case. What, therefore, is the geographical unit for allocating these resources? Is it Scotland, England, Yorkshire or Gwent? Any approach on these lines would involvea complete reappraisal of the whole financial structure of the United Kingdom which would at best take a very long time and on which we would probably get no agreement over the United Kingdom as a whole. It would certainly put at risk, if it did not in practice undermine, the Government's ability to use some of the resources of the luckier regions to help the less fortunate. And, of course, so far as the result would leave any particular area with less than its reasonable share of the resources of the United Kingdom, we would be back to the need for topping up finance and to detailed assessment of those needs by the Government with which I dealt earlier.

Nevertheless, the noble Lord, Lord Mackie of Benshie, quoted Northern Ireland as a precedent for the devolution of industrial and agricultural powers. It is correct to say that the Government's proposals now are not identical to the former arrangements for Northern Ireland. In some cases the arrangements represented more, in some cases less, devolution than is now proposed for Scotland. I accept the point made by the noble and learned Lord, Lord Hailsham of Saint Marylebone, that if devolution is to become more general the Government must have regard to some common principles. In my view they have sought to do that in the White Paper. I also note the views of the noble Lord, Lord Mackie of Benshie, about economic powers and I have explained the views of the Government. The indirect economic powers of the Scottish Administration will, of course, be considerable. It will have powers over the industrial environment, over factory building, over the provision of sites, all highly important for the promotion of industry. The Government have considered that the unity of the United Kingdom economy, which most of us seem to want to maintain, would be at risk if wider economic powers were devolved. But the details of the arrangements will be carefully examined in the light of the debates in Parliament and the wide-ranging consultations which the Government have initiated. Similar considerations arise in relation to agriculture; here too we shall bear the noble Lord's point in mind along with the views of the agricultural organisations which have been consulted.

Lord DRUMALBYN

My Lords, before the Minister leaves this aspect, may I ask him to indicate how the block grant is to be arrived at? Are we going back to some Goschen formula such as we used to have; are we going to start from a base year and continue along that base year, or are we going to take into account the variations that may be required in expenditure from year to year?

Lord KIRKHILL

My Lords, in reply to the noble Lord, I can say that thus far, within the White Paper at least, the thinking has been along the lines of a base year.

Lord MACKIE of BENSHIE

My Lords, may I make a point following the noble Lord's statement that the benefits from oil may be temporary? In the area from which both he and I come there has been development and dislocation. Surely, therefore, the noble Lord will go along with the view that perhaps there should be an allocation of oil revenues to see that when the oil runs dry we do not have the sort of situation we have in Central Scotland with the coal and iron ore running dry.

Lord KIRKHILL

My Lords, if the noble Lord will bear with me he will find that I touch on that subject. The Government view is that nothing can be achieved by allocating parts of particular revenues to the devolved administrations which cannot be achieved by the block grant. Oil and all other revenues will be in the pool from which the block grants will be drawn. So far as the needs of Scotland and Wales justify disproportionate use of any of these revenues on their behalf, this can and will be taken into account in assessing the block grants.

As for sense of responsibility, the Government do not see that this would be helped by enabling the devolved administrations themselves to raise some pert of the money which they spend when a large part of that money would still have to come from the Government and when the Government would be taking into account the taxable resources of the devolved administrations in setting their own contribution.

I return to the question of the rates surcharge. This is a proposal which finds no favour with the noble Lords, Lord Hughes and Lord Home of the Hirsel, nor with the noble Earl, Lord Minto. I join with others in congratulating the noble Earl on an excellent maiden speech. The proposal is of course for a surcharge on local taxation. The effects of this will have to be reveiwed in light of the Layfield Committee Report and any decisions taken in light of it. But meanwhile we have the prospect of a surcharge on the rates. Given the arguments I have already outlined for the block grant and against the allocation of particular revenues to particular regions, the choice lies between a surcharge on some existing tax and an entirely new tax. Since the levying and rate of this tax would be at the discretion of the devolved Administrations, it follows that the tax should be paid only by Scottish and Welsh taxpayers. That rules out some possibilities at once—for example, corporation tax or a supplementary levy on Scotch whisky.

The tax must be worth collecting. That is, it must yield a reasonable amount of revenue and not too much of that revenue must be spent in collecting it. A surcharge on Scottish and Welsh car licences, for example, would yield too small an amount to make it worth while and complex schemes for extra income tax would be ruinous in administrative costs, particularly in relation to a tax which was to be levied only at intervals. The tax must be secure against evasion. Surcharges on petrol or on betting would simply lead to petrol being bought and bets being placed outside Scotland and Wales wherever possible.

Rates meet all the criteria. They are also within the field of local government, which is a devolved function, as opposed to that of general taxation, which is not. No tax—least of all any extra tax—is popular, but rates are at the moment undergoing something of a crisis of ill repute, at least in Scotland. Solely because of this, many people have rejected the Government's proposal out of hand without thinking about it. I hope I have said enough already to show that alternatives are far from easy, and there is much more besides. None the less, the Government are very willing to listen to suggestions, and they will take note of suggestions made by my noble Lords earlier in the debate.

Lord TANLAW

My Lords, regarding the block grant, can the noble Lord kindly clarify who is to assess it? Will it be the devolved Administration which will have a kind of budget, or will it be assessed here in Westminster? I believe that this is a major problem leading on from many speakers' observations about the surcharge.

Lord KIRKHILL

My Lords, initially, it will certainly be assessed after consultation with the devolved Assemblies. Beyond what I have just said I do not feel that I can add anything to that statement.

I recognise the wish of the noble Lords, Lord Mackie of Benshie and Lord Polwarth, to see the Scottish Development Agency wholly responsible to the Scottish Assembly. The Government propose to devolve the Agency's activities as far as they can. The bulk of its expenditure is likely to be on services for which it will be responsible to the Scottish Administration, but a significant part will be in a field which is not to be devolved—that of selective assistance to industry. To devolve that part of the Agency's functions would, in the Government's view, be inconsistent with the Government's general approach on economic powers and could not be considered separately from a review of that approach.

The Highlands and Islands Development Board will of course be responsible to the Scottish Administration subject only to the issue of general guidelines by the Government as to how it carries out that part of its functions concerned with assistance to industry. I now come to—

The Earl of PERTH

My Lords, we have listened to what the noble Lord has said in relation to the Scottish Development Agency. I very much hope that what he said in other cases—namely that he, or the Government, will listen to the points made by noble Lords in the debate today—also applies to what has been said in relation to the Scottish Development Agency. From what he has said at this moment, I feel that the door is shut. I should like an assurance from the noble Lord that he will listen to the reasons for a change which have been advanced by almost all noble Lords today.

Lord KIRKHILL

My Lords, the Government are always willing to listen, but at this stage they are of a view as I have expressed it as to the Scottish Development Agency's functions and responsibilities for these functions.

I come now to the directly economic functions, in particular industrial steering, selective assistance to industry and Government participation in industrial activity, such as will be possible through the National Enterprise Board and the Scottish Development Agency. The proposed reservation of these functions has tempted some people to say that devolution is useless. That criticism implies a very mistaken disparagement of the vital functions such as health, education, the planning and control of the environment which are to be devolved, and to which Parliament has seen fit to devote a great deal of time. The noble Lord, Lord Drumalbyn, emphasised this in the course of his remarks. The Government's policy is to devolve whatever can be devolved consonant with the overall interests of the United Kingdom, including the interests of Scotland and Wales, and they have reserved the economic functions because they think this in the best long-term interests of Scotland and Wales.

The wish to have these functions devolved presumably rests on the expectation that, if they were devolved, the Scottish and Welsh Administrations would be able so to change their operation as to make the promotion of industry in Scotland and Wales much more effective than it is at the moment and much more effective than it is in other assisted parts of the United Kingdom. But if they succeeded in doing so, the effects of this success could not be confined to Scotland and Wales. With a unified United Kingdom market, unified tax system and free movement, some of the success of Scotland and Wales would have to be at the expense of the rest of the United Kingdom; perhaps at the expense of parts of the United Kingdom quite as much in need of industrial rehabilitation as Scotland. No United Kingdom Government could acquiesce in that situation—

Lord MACKIE of BENSHIE

My Lords, surely the noble Lord has failed to take the point? If Scotland, with a unified system of taxation, was able to attract more, it would be of great benefit to other parts of the United Kingdom, because they would be able to learn from it.

Lord KIRKHILL

My Lords, that is a point of view which the noble Lord has expressed. It is not a point of view with which I agree, and I shall now continue to express the Government view. As I was saying, no United Kingdom Government could acquiesce in the situation to which I referred. If it occurred, it would set in train a process of competitive bidding up of industrial incentives which would disrupt the whole process of sensible industrial steering and be self-defeating.

This is not a matter of holding back Scotland and Wales in the interests of the rest of the United Kingdom. On the contrary, both have been heavily dependent in the past on the stick as well as the carrot of the industrial development certificate system to discourage industry from expanding in areas where there was already considerable development, thereby encouraging movement to take advantage of the incentives available in those areas where it was badly needed. In applying these controls at present, the Government have the interest of Scotland and Wales very much in mind, as well as those of the industrially less fortunate parts of England. But if the Scots and Welsh were responsible for their own industrial incentives it would be difficult for the Government any longer to co-ordinate their industrial controls with Scottish and Welsh incentives policies and difficult, too, for them to feel the same sense of responsibility to restrict growth in parts of England in order to improve the chances of growth in Scotland and Wales.

My Lords, at this point oil invariably enters the argument again. The Nationalists would argue for Scotland that all these problems would be resolved by independence, when the oil revenues would make possible the swift restructuring of Scottish industry into an efficient modern format. This is highly doubtful. There are questions about the rate of depletion of the oil fields, about the price at which North Sea oil can be sold on the world market at any given time, about the extent to which the oil revenues would distort Scottish price levels and the competitiveness of Scottish industry. These are all great uncertainties. It seems fairly certain that the oil reserves are finite and will permit only a limited period of good fortune which must be put to good use. It is absolutely certain that, at present, the Scottish and English economies are very closely interlinked, and that the consequences of pursuing different and conflicting policies in relation to the two would be very painful and expensive. Trying to achieve the possibility of a separate economy is likely to be, for Scotland, a very extravagant way of using the oil revenues.

Many noble Lords have expressed opinions upon the efficacy or otherwise of there formed system of local government, and I should say that the structure of local government in Scotland, at least, will be a matter for the Assembly once devolution becomes operative, but the Government have sought to make two things clear on this subject. First, as my noble friend the Leader of the House indicated today, devolution by itself does not create any case for the reorganisation of local government. We are not adding a tier of government: we are transferring responsibility for certain existing functions from one central authority to another. There will be no duplication either of central or local government activities. It is not reasonable to say, therefore, that devolution will by itself cause over-government.

Secondly, local government reorganisation is a highly complex business. The reorganisation recently implemented took many years to consider and plan, as indeed the noble Baroness, Lady Elliot, indicated in her contribution to the debate earlier. Any new local government structure needs time to settle down and show its true characteristics. The Government think it very probable that the long-term views on the merits and demerits of the recent reorganisation will be quite different from the views currently held; and I was very pleased to have support in this thought from the noble Earl, Lord Kintore, in his earlier contribution. The Government very much hope that the Assembly, when set up, will be prepared to recognise this and will not rush hastily into a further reorganisation.

The noble Lords, Lord Mackie, Lord Hughes, Lord Belhaven and Lord Drumalbyn, have drawn my attention to the description of executive titles as written in the White Paper, and have been critical of that description. I have a suspicion that in this, as in a good many other matters, it may prove much easier to criticise the Government's proposals than to offer satisfactory alternatives. But I think I can safely assure the House that the Government will not regard the titles in the White Paper as essential to the sovereignty and unity of the Kingdom, and will listen to suggestions with an open mind.

In addition, several noble Lords have expressed disquiet about the policy veto. I do not myself wish to deal with this at length—it has been dealt with already and I am sure will be dealt with further —but, if I may say so, in the example he gave, the noble Lord, Lord Hughes, quoted from housing policy very clear evidence of the general misunderstanding about the Government's proposals. It is not the intention of the Government to intervene in Scottish and Welsh business simply because the Scottish and Welsh Administration is doing something which the Government do not like. The proposed devolved powers are very extensive. It is possible that in the exercise of these powers the devolved Administrations may occasionally propose to do things that would damage the United Kingdom generally. Only on such occasions would the Government expect to use the policy veto powers. I see no likelihood that the Government would use the powers in the case quoted by the noble Lord, Lord Hughes.

The question of mortgages, and so on, to which the noble Lord also referred, is a different matter. This can affect the flow of money, the general demand and inflation, and is therefore part of the general control of the economy. I think I must stress that while the Government will consider all these points very carefully, there is a great likelihood that restricting or dispensing with the political veto will on examination reveal that there must be either less devolution or more risks taken with the unity of the Kingdom. I would say at this point that my noble friend Lord Heycock, who has had to leave, posed a number of questions relating to local government matters and planning functions within the Welsh context. With your Lordships' permission, my noble and learned friend the Lord Chancellor or perhaps my noble friend Lord Crowther-Hunt will undertake the response tomorrow.

My Lords, devolution is a subject touching on almost every aspect of Government. I have had time to touch on only a few. I hope and expect that my noble friends who are sharing with me the task of presenting the Government's proposals in this debate will eventually have covered most if not all of the remainder. But I should like to end on one general point which I think is very important and which it is appropriate that I should make because the aspects with which I have been dealing have been widely criticised in the country at large and in the course of the debate today. The Government have said that they are willing to listen to suggestions for alteration of their proposals with an open mind. They mean that. But the Government's proposals have been very carefully worked out over a considerable period. They may be susceptible of improvement; but there are good reasons for all of them. Improvement is not a simple matter and I feel strongly that the Government's proposals and the reasons for them deserve more study than they have yet had from most people. It might then prove that the demand for alteration is less than at present appears.

The LORD CHANCELLOR (Lord Elwyn-Jones)

My Lords, I beg to move that the debate be adjourned until tomorrow.

On Question, Motion agreed to and debate adjourned accordingly.