[Relevant documents: Third Report from the Political and Constitutional Reform Committee, Session 2012-13, “Prospects for codifying the relationship between central and local government”, HC 656, and the Government response, Cm 8623; Fourth Report from the Political and Constitutional Reform Committee, Session 2012-13, “Do we need a constitutional convention for the UK?” HC 371; Oral evidence reported by the Political and Constitutional Reform Committee on 16 and 23 October and 6 and 10 November 2014, on “The future of devolution after the referendum”, HC 700.]
I inform the House that none of the amendments has been selected. Many colleagues have indicated that they wish to participate in the debate, so given the limited time available, there will be a time limit on Back-Bench speeches of seven minutes.
I beg to move,
That this House recognises the outcome of the referendum on Scottish independence; welcomes the freely expressed will of the people of Scotland to remain British; notes the proposals announced by Westminster party leaders for further devolution to Scotland; calls on the Government and Her Majesty’s Loyal Opposition to bring forward proposals that are fair and reasonable for the whole of the United Kingdom, following a period of public consultation to enable people in all parts of the Union to express their views; and, in particular, calls on the Government to ensure such proposals include a review of the Barnett formula and legislative proposals to address the West Lothian question.
I begin by thanking the Backbench Business Committee and its formidable Chair, the hon. Member for North East Derbyshire (Natascha Engel), who is not in her place today, for the opportunity to have this debate. I would also like to thank the right hon. Member for Birkenhead (Mr Field) for making common cause in co-sponsoring the debate and the motion. I thank, too, the 81 hon. Members from four parties who signed in support of the motion.
The great Scottish inventor of the telephone, Alexander Graham Bell, coined the phrase:
“When one door closes, another opens”.
For my part, I thoroughly welcome the outcome of the Scottish referendum and the decision of the Scottish people to remain part of the United Kingdom, but I also recognise—I say this at the outset—the division and the divide it has left north of the border and the consequences that need to be picked up south of the border. In the spirit of Bell, I want to focus on the positive opportunities ahead—opportunities to give greater expression to the Scottish desire for self-determination short of secession, and indeed opportunities for a wider democratic renaissance across the whole of the United Kingdom.
In truth, we have made some progress under the coalition. As a result of the Scotland Act 2012, the Scottish Government will raise around 30%—up from 14%—of their own tax revenue. All parties now pledge further tax-raising powers and greater control over social security. I say to those representing Scottish seats who want further devolution beyond the current consensus that I am rather sympathetic, and I will look at and listen to their ideas with an open and sympathetic mind.
Of course, beyond the UK, devo-max, as it is termed, can draw on a variety of federal models, including those of Germany, Canada and even Spain. Scottish National party Members and others will have noted that this would take us well beyond what was promised in the vow of the main party leaders in the Daily Record on 16 September.
The hon. Gentleman’s party leader, the Prime Minister, said during the referendum campaign that everything was possible and all was on the table. Does the hon. Gentleman disagree with that?
This may be the easiest intervention I get today, but I do agree that everything is on the table and that everything is possible. In fact, if the hon. Gentleman listens closely as I develop my speech, he will find that I am rather sympathetic to taking further steps toward financial devolution, which the hon. Gentleman and his colleagues have proposed.
Equally, there needs to be recognition that with greater financial freedom and power, Scotland must expect to bear some additional responsibility. I am sure that as a matter of principle—regardless of the practicalities—all hon. Members would agree with that. A new deal for Britain must be fair to all parts of Britain. In my view, that means two things. First, if we went down the road of devo-max or fuller financial devolution, it would eventually render utterly untenable the Barnett formula used by the UK Government to subsidise the devolved Administrations. That formula is based on outdated spending patterns and population numbers and is already divorced from any objective assessment of real need across Britain. If Scotland now wants greater powers to tax and spend—as I said, I am sympathetic to that—it cannot expect the Union and taxpayers across the Union to keep subsidising them to the hilt on such an arbitrary basis, without fuelling resentment in other parts of the UK. I note that that is also the logic of the SNP submission to the Smith review. I have it here and will happily read it later.
Does my hon. Friend not find it curious to hear these sotto voce interventions of SNP Members defending the Barnett formula, which is recognised as unfair to Wales and is vehemently opposed by Plaid Cymru, the SNP’s allies in the House?
As usual, my hon. Friend makes a cogent and eloquent point. That point is actually made by the SNP in its submission to the Smith review—that the logical consequence of full financial devolution would indeed mean the overhauling of the Barnett formula. I thus say to SNP Members that there may be potential for a nascent consensus on some of this—if it can be reached and grasped.
I suppose it depends on how broad, far and deep is one’s horizon. [Interruption.] Let me pursue that a bit more, because I want to be clear about it. Today’s motion does not seek to ride roughshod over the vow. It calls for a review of Barnett without prejudice to what would follow. I do not see how anyone on any side of the debate could possibly refuse to countenance consideration of the impact of further financial devolution on the rest of the UK. That would have to entail a review of Barnett.
There is almost a point of agreement here. In our proposals to the Smith review, we said:
“As part of any agreement, the Barnett Formula should continue to be used to determine Scotland’s resources during any transitional period”.
We are seeking full fiscal responsibility and in that event there would obviously have to be changes to Barnett.
Will the hon. Gentleman give way?
I am going to make some progress before I give way again. I have been very generous so far.
We must also consider points south of the border, where many people bristle over the fact that Scottish public services already receive over £2,000 more investment per person each year than some parts of England. That investment does not just subsidise free prescriptions and university tuition; in proportion to its population, Scotland has twice as many nurses and ambulance staff as England, and 43% more police officers. However, this is not just a southern gripe. Scotland’s public spending per person on housing and community, for example, is twice as high as that of the midlands, Yorkshire or Humber and the north west, and by comparison with Scotland, Wales gets a poor deal too. I am sure that Members representing Welsh seats will want to make that point for themselves.
I am going to make a small amount of progress, but I will happily take an intervention a little later. I am conscious of the time restraints. I have been told that I have 15 minutes tops, and I want to respect that, because otherwise I shall get into trouble with you, Madam Deputy Speaker.
I know that colleagues in the Scottish National party will argue for the retention of North sea oil revenue in return. Rather than ducking that argument, I want to address it head-on before I give way again. I say to SNP Members that, personally, I accept that basic logic in principle, but it must surely take into account all the British taxpayers’ money that was originally invested in the extraction of the oil, and it also requires us to think far more seriously about the geographical allocation of financial resources across the board. I am sure that they will accept that logic, as it follows theirs. Given the new findings of shale gas across England and the draining of oil production from the North sea, I doubt that this is the lottery ticket on which the SNP is betting, but I cannot deny that it is a natural consequence of pursuing the constitutional logic of financial devolution.
Can we not agree, at this stage at least, to arrange the independent review of the Barnett formula for which the motion calls, in the light of proposals from the main parties and across the board, so that the implications for those in the rest of Britain can be examined? Surely their voice, their interests and their concerns cannot be locked out of the debate for ever. Can we not reasonably agree that, subject to areas of spending that will be devolved, the remaining revenue allocated across Britain should follow a needs-based approach, which is precisely how revenue is allocated internally in Scotland?
Does not focusing the debate on the Barnett formula mean focusing it much too narrowly? If we are looking at expenditure, should we not look at the expenditure that the Barnett formula does not fully reflect? Should we not look at the income that the state receives, and the pooling and sharing of resources? If we are to have a review, let us look at the whole picture, rather than picking just one aspect of it.
Surely it cannot be right for someone who is living with, say, heart disease or cancer to suffer because an extra £203 per head has been allocated elsewhere owing to an accident of geography. Surely all Members want a settlement that is fair to individuals with long-term conditions, wherever they live in our United Kingdom.
Let me say something instructive to the hon. Gentleman. He has mentioned subsidies for Scotland a couple of times. If he is going to talk about subsidies, he should understand that referring to expenditure in Scotland in terms of the Barnett formula is cherry-picking. It represents only two thirds of spending, and that is just identified spending: there is another third of non-identified spending. Talking about the Barnett formula is a trick used by Tories and Labour Members to suggest that certain moneys are spent in Scotland. They are not talking about the whole pie; they are talking about two thirds of the pie. That is the trick.
If the Barnett formula is not subsidising Scotland to the degree that concerns some of us, why is the SNP so averse to any review of it, let alone change? However, as was pointed out by the hon. Member for Edinburgh North and Leith (Mark Lazarowicz), this is not just about the Barnett formula. The second price of further devolution must be steps to bridge the democratic deficit between Scotland and the rest of the Union. As in the case of the Barnett formula, south of the border it smarts that Scottish MPs in Parliament still vote on matters concerning England—from social care to school reforms—that in Scotland have been devolved to the Scottish Government.
There are various ways in which we could address the so-called West Lothian question. Others will have different views, but I believe that, as a minimum, any new legislation should implement the common-sense plan presented in 2008 by my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) to restrict Scottish MPs from legislating at Westminster in Committee and on Report on issues that do not affect Scotland. I suspect that, far from creating deadlock—which is what has been put about—that would lead to a rather healthy spirit of compromise. A United Kingdom Government who were reliant on Scottish MPs would retain the power of initiative, and England would have a democratic shield to prevent such a Government from imposing their will on it without consent.
As I am sure the hon. Gentleman knows, of the 460 pieces of primary legislation proposed by the Government since 2001—the year of the first post-devolution Parliament—eight have been England-only. “English votes for English laws” may suit a headline, but it does not address the real issue—the much more significant issue of the way in which power is distributed around the UK as a whole.
The hon. Gentleman has made his point very calmly and sensibly, but it seems to me that if we managed to work out how to determine questions such as these for the Scottish Parliament and to enable Scottish devolution to take place, it is not beyond the wit of man or woman to work out how we can redress the balance for England, while also ensuring that the other constituent parts of the United Kingdom have an equal voice. I am sure that the hon. Gentleman would not want his words to be taken as suggesting that he does not believe in the principle of democratic equality. However, as he says, the implications of further Scottish devolution go well beyond England. I look forward to hearing the contributions from Welsh and Northern Irish colleagues, given their unique interests and special circumstances. I say, as an English MP, that their voices must be heard.
I think the hon. Gentleman will find that London is part of England, and will, by definition, be considered.
I must refer briefly to the amendment tabled by the Leader of the Opposition on behalf of the Labour party. The amendment, which was slipped on to the Order Paper at the last minute, strips out and opposes, in express terms—
Thank you, Madam Deputy Speaker. I bow to your instructions and guidance.
The proposal, as it was, strips out and opposes, in express terms, any consideration of the Barnett formula. It strips out and opposes, in express terms, any attempt to address the West Lothian question. The Leader of the Opposition seeks to entrench democratic inequality and financial unfairness, for the sake—I fear—of short-term electoral expediency. If we are looking together at a long-term deal for Britain that is good for the whole of Britain, that is utterly unsustainable. I think that our debate will have established, at the very least, that the formal position of the leadership of the Labour party—I recognise that there are diverse views among Back Benchers—is now crystal clear. The Leader of the Opposition is opposed to, and is blocking, reform that would ensure that the legitimate concerns of those who represent English seats were addressed.
Let us think beyond the nations. Devo-max could spur democratic reform well beyond devolution. We still have one of the most centralised systems in any western democracy. We still have what is effectively a system of “one size fits all” governance, magnifying the effects of bad policy and suffocating local innovation. I recognise that the coalition has taken steps in the right direction—for instance, it has established locally elected police and crime commissioners, and has given councils a bigger slice of the tax revenue from the sale of new homes—but Whitehall still grips 80% of the purse strings. In other advanced countries, an average of about half of local or regional government spending is financed by local tax revenue.
I think it is fair to say, on the basis of material from the Adonis review to the Heseltine report, that across the political spectrum there is now a groundswell of ideas on how to deliver stronger local democracy—by providing incentives for local business growth, by promoting home building, or, more broadly, by tailoring policy to local needs whilst ensuring that it is accountable to the taxpayers who will ultimately foot the bill. Bringing decisions on those key issues closer to those who vote and who pay for them might not be a silver bullet, but it will play an important part of rebuilding trust in our democracy.
We should all recognise that the no vote in September’s referendum will not end the Scots’ yearning for more control over their own lives, but, rather than those on either side resenting it, the rest of Britain should look on it as an opportunity for democratic renewal, which must take place across the whole Union. As Graham Bell put it,
“we often look so long and so regretfully upon the closed door that we do not see the one which has opened for us.”
I commend the motion to the House.
I congratulate the hon. Member for Esher and Walton (Mr Raab) on securing the debate. Like him, I welcome the result of the Scottish referendum. However, Members should be under no illusion. The way in which the UK is governed has changed, and we cannot change it back. These issues are more important than the Barnett formula. Promises were made about devolution max to the people of Scotland, and those promises have to be honoured. It would be inconceivable—and political suicide—not to do so. Once those promises have been honoured and powers have been transferred to Scotland, however, there will quite rightly be demands from the Welsh Assembly and the Northern Ireland Assembly for the same powers to be transferred to them. If those powers were not transferred, the people of Wales and Northern Ireland could rightly say that they were being discriminated against.
May I caution the hon. Gentleman about saying that exactly the same powers should be offered to Wales? Wales is not Scotland. Speaking as the chairman of the Welsh Conservative party, I must tell him that the Conservatives are the official Opposition there. That is not the position in Scotland. We are two very different countries.
I did not say that the powers would automatically be transferred. I said that they would have to be offered to the people of Wales and Northern Ireland, because if they were not, the people of those countries could rightly say that they were being discriminated against.
Once Scotland has been given devo max, if Wales and Northern Ireland choose to go down that path as well, there will in my opinion be an unstoppable momentum for an English Parliament to be set up. That is, and has always been, the logic of devolution, and we have to live with that. This raises other questions as well. If we have four Parliaments responsible for a whole range of services, the role of the Westminster Parliament will have to change. Westminster could of course retain its role in foreign affairs, defence and international trade matters, as well as a whole range of residual responsibilities, but such a change would automatically mean that there would be no need for such a large House of Commons, because many of the services would have been devolved. We would need a much smaller House of Commons.
As part of the new constitutional settlement, we are going to have to ask other questions. Would the Westminster Parliament continue to need two Chambers, the House of Commons and the House of Lords, or could we have a unicameral Parliament? Would we need to retain the House of Lords in its present form, or could it be abolished? If these changes were to happen, the four devolved Parliaments, together with the Westminster Parliament, would also have to decide on the role of the monarchy in the new constitutional settlement. On the front page of The Guardian newspaper today, Prince Charles’s spokesman is suggesting that King Charles III would have a much more activist role in British politics, so it might be appropriate to have such a discussion.
The Scottish referendum has changed politics in the United Kingdom completely, and we cannot turn the clock back even if we want to. Once we started down the road of devolved government in this country, we were always going to be faced with the prospect of referendums on independence. Such referendums will be won only by winning hearts and minds, as happened in the Scottish referendum. There will be more of them in future. The reason that nationalist parties exist—in Scotland, Wales and indeed in Northern Ireland—is to seek to achieve independence for their countries. That is perfectly reasonable and proper, but if that was not their objective when those parties were set up, they would have no future role whatever.
Like it or not, we are moving towards a federal structure in the United Kingdom. I believe that that holds considerable attractions, although others will disagree. The momentum is such that it is going to happen, however, and I believe that it will happen sooner rather than later.
I apologise for missing the first few remarks made by my hon. Friend the Member for Esher and Walton (Mr Raab). I should like to say that it was a pleasure to listen to the hon. Member for Birmingham, Hall Green (Mr Godsiff), but it kind of wasn’t, really. It was disappointing to hear the suggestion from the Opposition that the devolution of powers is a way of splitting up the Union by the back door. I do not believe that it ought to be, or that it was ever meant to be. Scotland voted to remain part of the Union, and I am very glad that it did so.
Powers have gone to Wales and Scotland, and quite rightly so. They should have a say over how they run certain important matters that are particular to them. This cannot be a one-way street, however. We cannot give powers back and not expect that to have an impact on the workings of this place. Inevitably, there will be subjects relating to Scotland and Wales that we will be expected not to vote on. Stamp duty could well be one of them. This is a subject that I am particularly passionate about, because Scottish Members could potentially vote on stamp duty in England. According to the latest figures, my constituency pays more stamp duty than Scotland and Wales put together, and I find it amazing that I would have no say over stamp duty in Scotland, yet Scotland could well have a vote on stamp duty in my constituency. That is rather bizarre.
The logical conclusion of our giving powers to Scotland is that we should recognise the democratic deficit that it has created in our own Parliament. That needs to be addressed. I accept that we have a united Parliament, but that does not mean that we cannot come up with a system that recognises the new arrangements. We do not need to create a whole new English Parliament, as the hon. Member for Birmingham, Hall Green suggested, but we need to observe custom and practice and say that there are certain things that hon. Members from Scotland or Wales should not participate in. That would be a fair situation.
I remind the hon. Lady that Northern Ireland remains part of the United Kingdom, in case we are in any doubt. Does she agree that a similar approach should be taken when reserved and excepted matters for Northern Ireland that affect only Northern Ireland are voted on in this place? On those occasions, where Northern Ireland Members have agreed on a certain course of action we are often overruled by English MPs.
The hon. Lady makes an interesting point, and I am certain that there would be no reason why, if the motion is carried today, everything could not be on the table for discussion. It would be up to her to make her case, but I think that what she describes is very different from what the hon. Member for Birmingham, Hall Green was suggesting, which was that we have to split up the whole of the Union into little tranches of competences. It would be unrealistic, and it would certainly result in a democratic deficit, to suggest that people in Scotland can have grabbed power for themselves, and rightly want to use it, but resist giving away any of their powers in this place. I know it suits the Labour party to try to keep those powers, but we have to make the case that it is not reasonable and not fair.
Lord Barnett has said the following about the Barnett formula:
“It is unfair and should be stopped, it is a mistake. This way is terrible and can never be sustainable, it is a national embarrassment and personally embarrassing to me as well.”
I do not believe we should scrap the Barnett formula, but we should certainly review it, and whatever comes out of that would be done with the will of the House. Far less money is spent on my constituents and I find it hard to justify to them that in my constituency, which contains areas of multiple deprivation, people get some 11% less than the UK average, 23% less than Scotland gets and 28% less than Northern Ireland gets.
I will not give way. I am sure that many MPs on the Benches around the hon. Gentleman want to make the case for the Scottish National party.
Because of the flaws I am outlining—[Interruption.] My constituency is not in London. St Albans is in a county above London, and we are not part of the London development system up there, but we have to pay a high price for our properties. My constituents do not understand why they are net contributors to the Chancellor’s coffers and do so badly when they are trying to get services—
I can get away from it—I can ask the hon. Gentleman to sit down. My constituents are as much in need of services as any other constituents. [Interruption.] If he wishes to make his speech when he gets to have his turn, fair enough, but please stop barracking me from the Opposition Benches. My constituents are entitled to expect a decent level of services, and it is hard to provide that when the formula is so skewed in the way that it is. We should look at it and review it.
I think I have made it clear to the hon. Gentleman that I do not intend to give way on the Barnett formula; my constituents are very exercised about it. St Albans city & district council—Conservative-led—has frozen council tax for the seventh year in a row, but people cannot expect to have money come out of nowhere. My constituents find it difficult when they see people north of the border having far more money spent on their services.
People have talked about respecting the views of Scotland when it voted on independence. It is a shame the SNP does not do that, because it seems as though this is a “neverendum” campaign—it is as though the vote never happened. It is as though it has just been a blip on the road to still delivering independence. So may I say to SNP Members that the vote was lost? They may not have noticed that. Its new leader—as of today—has said recently:
“I want this party of ours, this movement of which we’re so proud to belong, to keep making the case for Scotland being an independent country.”
As such a large amount of Scots’ money has been spent on this—about £14 million, I believe—may I suggest that we rest the matter for a while and now try to address the democratic deficit that has come out of it? The campaign for independence was lost and now we have to ask how we get a good deal for Scotland; as was promised.
The deal that was promised by all three leaders was that Scotland would have new powers and a fair deal under a Barnett formula or something like a Barnett formula—I do not know what it will be called. Inevitably, as has been said, times move on. The argument has moved on from all the power being here to the power being shared out by those who best know how to use it—I am sure the Scots would not object to that description—for their own local communities, so that shows that the argument has moved on from independence. It is time we drop the “neverendum” campaign, constantly dangling the prospect of independence, and say, “Let us get the right deal and the right formula.” That right formula must be obtained for constituencies such as mine, which say that it is not fair that people in Scotland who have no interest in the stamp duty in St Albans may have a say on it, whereas my constituency will have no say on stamp duty levels in Scotland. Let us recognise that democratic deficit. Let us ensure that we have a fair deal. I cannot see why anyone on the Opposition Benches would argue against a fair deal for their constituencies in England—they would have to explain to their own electorate why they would like to remain in an unfair scenario created as a result of the referendum vote.
First, I thank the Backbench Business Committee for the opportunity to have this debate and the hon. Member for Esher and Walton (Mr Raab) for introducing the subject. I want to discuss city regions and, specifically, the Liverpool city region, but first I wish to make two brief general points. The first, which is largely accepted across the political spectrum, is that there has been over-centralisation in the UK, as a result of which our city regions—and, some would argue, our counties—have underperformed on productivity, investment, value added and many other things. The second is that, without doubt, there is public disenchantment with the Westminster-Whitehall model and an appetite, certainly in my constituency and in my city region, to ask what we can do for ourselves and whether we can do it better than central Government and the Westminster-Whitehall model.
I now wish to discuss how the Liverpool city region could move towards a better model in terms of fiscal powers and additional powers that currently are either with central Government or with other bodies that are not directly democratically elected. On fiscal devolution, I wish to make two points. First, as a result of fiscal devolution there is a need to enable city regions to retain local investment and local taxation; local finance bonds offer potential, and it is necessary to remove the restrictions currently on local government and, in particular, on combined authorities in the work they can do to support growth. I will not labour the second point, but there needs to be greater flexibility on borrowing. When there is a big strategic reason, such bodies should not have to go cap in hand to central Government, but instead operate a more prudential system to determine what is right.
My right hon. Friend is making a persuasive argument. Does he agree that, constitutionally, the role of local or regional government needs to be safeguarded, so that central Government, both here and in Scotland, do not dictate the level of council tax or revenue raised by local authorities, thereby hemming in their ability to react to local demands?
I am grateful to my hon. Friend. Given what I have said, it follows logically that I do agree with that.
I was going to say a word in response to the hon. Member for St Albans (Mrs Main) but she seems to have disappeared. [Hon. Members: “She has moved.”] Oh, I am sorry. She put forward an argument about the Barnett formula, but there is a different, less polarising way of expressing her points that actually supports her underlying argument. I do not personally—and neither, I am sure, do most colleagues, certainly on this side of the House—have any difficulty with the Barnett formula. What I want is a Barnett formula for England, or something equivalent, and others will make a strong case for something similar for Northern Ireland and Wales. The issue is how we get a fairer distribution of resources.
The hon. Lady nods in assent, as what we are saying is very much along the same lines; I just put it in a slightly different way. I think we need a better system of distributing resources, certainly to areas such as mine where the need is great yet is not currently being addressed.
I want to talk briefly about some of the powers. This is not an exhaustive list, but it suggests the sort of areas we could move forward on: innovation, research and development, housing, skills, employment support, infrastructure and, in the longer term, transport, policing, waste disposal and fire and rescue services. Those are the areas we should be, and indeed are, talking about.
I hope we can have this discussion out in the open. What slightly disturbs me is that there are a lot of discussions going on behind closed doors. We need an open discussion about this.
On the Liverpool city region, another issue that arises is what sort of leadership and accountability would be appropriate. There is an issue about whether we have an elected leader, or an elected metro-mayor as some seem to call it. The position that most of the leadership of the councils on Merseyside—and possibly the wider population—take, and which I share, is that we do not want to be prescriptive about this. The Chancellor made the point that there is no one-size-fits-all solution, and I agree, but quiet pressure is being applied behind closed doors, not least from Lord Heseltine, to go along a particular road.
As it happens, I personally would not rule out the possibility of having a directly elected mayor, but I do think it needs to be the subject of proper discussion, and I also believe that that discussion needs to take place out in the open, transparently and publicly, and that, if it goes that far, because this would be a big departure, some means of consulting the public about having an elected mayor should take place, and I personally would favour a referendum on that.
My right hon. Friend is putting forward a good case for the city region of Merseyside, and I think he and I would agree that the boundaries of such a region should not be drawn from here in Westminster. Equally, the leadership should not be determined from here in Westminster. Does he agree that whatever model evolves from the discussions, it is essential to get the support of the people behind it?
I agree with my hon. Friend, and I think I said as much. I believe that it would be sheer folly to impose a leadership and accountability system without first having the wholehearted support of the wider public.
My hon. Friend also raised a point about what the boundaries might be. At the moment, we are made up of Halton, St Helens, Sefton, Knowsley, Liverpool and the Wirral, but there is a wider appetite for this, certainly from West Lancashire, which is in a process of negotiating whether it wants to be part of the combined authority that already exists. There is also some interest from the west Cheshire local authority area—which my hon. Friend’s constituency is in—to see whether it might want to be part of it. It might even encompass, in the wake of what has happened in Manchester, Warrington. I am not making a land grab for any of those areas. It is for them to decide, but I do think that question should be on the table, and it should be something that can be discussed.
What was said of the Scottish referendum is also true for the whole of England: this is a once-in-a-lifetime opportunity to get it right. It is a once-in-a-lifetime opportunity to shift the balance away from Westminster and Whitehall to local communities who know better what they want out of politics and what they want out of services. I hope we can get this right, but most of all I hope we can now have this discussion in the open and in public and not behind closed doors.
I congratulate those hon. Members who secured this important debate today.
Just two months ago, the Scottish people voted decisively in favour of remaining within the United Kingdom. Following that decisive vote, the Government kept their promises and moved quickly to set up the Smith commission to convene cross-party talks and an engagement process across Scotland. The timetable agreed by both the Government and the Opposition involves the Smith commission reporting at the end of next week, draft legislation to implement their findings to be published by 25 January and that legislation being passed in the early stages of the next Parliament. That is the timetable that was promised by the leaders of the three main parties in the run-up to polling day in the referendum, and it is essential that it is adhered to.
So far, the timetable has been adhered to. My right hon. Friend the Secretary of State published a Command Paper before the end of October; in fact it was a couple of weeks early. The Smith commission is working, and there is every indication that it will publish its proposals, as planned, by the end of next week, and I assume the rest of the timetable will also be adhered to.
Of course constitutional change must be fair to the whole of the United Kingdom, and I am sure that in the coming years we will see further progress on devolution for the other nations and regions of the United Kingdom, but further powers for the Scottish Parliament must not be held up while those debates take place in the other parts of the UK.
The vow that was made in the run-up to the referendum—just before polling day—was that the Barnett formula would continue. I think any reasonable person would interpret that as meaning it would continue as it is. I note that the hon. Gentleman’s party leader made that promise in the run-up to the referendum. I assume that his party leader went through the policy-making procedures of his own party before he made that promise. [Interruption.] As an outsider, I have always assumed that the policy-making procedures of the Conservative party were that the leader made policy. None the less, the hon. Gentleman is a member of the Conservative party, and his leader made that promise and I would expect the party to adhere to the promise made by its leader.
The coalition agreement has been adhered to. At my party’s conference in October—it is usually in September, but the SNP chose a date that falls during our conference for the referendum—we passed a motion that the Barnett formula would be continued. The hon. Gentleman is correct that we had a different policy in the past, but we have a democratic policy-making process in our party, and the party, through its democratic policy-making processes at our annual conference, has voted that the Barnett formula should continue.
Yes, it is all right. That is a point on which we agree, but it is about the only one.
Where I do agree with the movers of the motion is that the West Lothian question must be addressed. There is clearly an unfairness that I, as a Scottish MP, can vote on health, education and other matters as they affect England, but not in my own constituency. Clearly, that must be addressed. The only way to do that is to set up a federal system for the United Kingdom.
Let me just finish this point. Any solution that involves removing the ability of MPs outside England to vote on English matters will inevitably lead to a situation in some future Parliament in which a Government would not be able to get its English business through the House. We have all seen what happens when there is gridlock in the US, and I hope that we would not want such a situation to arise here. But that is exactly what will happen at some point if the only change that was made was to stop Members from outside England voting on English-only matters, but not changing any other part of the constitution. Setting up a federal system for the UK is the way to resolve that issue.
For that change to take place, does the hon. Gentleman agree that a constitutional convention should be set up to look at not just Scotland or any other region but the whole of the United Kingdom, and the way that it is governed? If there were such a chance to vote on a constitutional convention, how would he vote?
I certainly agree that a constitutional convention is a good idea, but it must not hold up the present process of devolving further powers to the Scottish Parliament. The present Smith commission process must go forward, but a constitutional convention to look at the whole UK is certainly a good idea.
The hon. Gentleman made the point that we must consider Scottish MPs voting on issues such as the English health service, but does he not see the contradiction in relation to Barnett? Any increases to the English health service and any increases in finances mean that there is a consequential effect through Barnett to Scotland, so those issues have to be analysed as well.
The hon. Gentleman makes an interesting point. Legislation does not of itself lead to more spending. We allocate spending when we pass the estimates every year. Although legislation may mean that carrying out certain functions costs more money, the decisions on spending are made only when we pass the estimates. Certainly when we pass the estimates for the English health service, there is a knock-on effect for Scotland. It is perfectly in order for Members of Parliament representing constituencies outside England to vote on those issues, but legislation purely for the English health service could be left to the English representatives. But the only way that that can happen in practice is if we set up a federal United Kingdom with an English Parliament. If Members cannot vote on some issues in this Parliament, it will lead to a situation in which a Government cannot get their policies through.
Clearly, there is an issue that affects Northern Ireland. It is responsible for a great deal of spending, but has no tax-raising powers by itself. I am not in favour of devolving welfare to Scotland, but it is already devolved to Northern Ireland. Perhaps the Northern Ireland experience is an indication of why it is not a good idea to devolve welfare.
Where I part company from the movers of the motion is that I think there is no need to hold up the Smith commission process in order to have a review of the whole UK. On the eve of the referendum, the leadership of the three main parties made a vow, and it is essential that that vow is adhered to; what was promised must be delivered.
I congratulate colleagues on securing the debate. Something that has gone unmentioned so far in these proceedings is the fact that this is an historic day for Scotland, the Scottish National party and Nicola Sturgeon, Scotland’s new First Minister. She is our first female First Minister. For colleagues who had the opportunity to see First Minister’s questions today, they would have seen a remarkably talented politician, and I, along with many others from across the Chamber, wish her well. Perhaps ours is the only Parliament in the world that has the three largest parties being represented by women from the Front Bench.
I am still only in my introductory remarks. It is also important on such an historic day to pay tribute to Alex Salmond on his leadership of the Scottish National party and his premiership as First Minister, both in minority and majority Governments, and for delivering free education in Scotland and the independence referendum.
I do indeed pay tribute to Alex Salmond who is a very considerable figure. By resigning, he seems to have recognised the outcome of the referendum. If the referendum had voted yes, that would have settled the issue for all time. Does the SNP accept that by voting no, it has settled the issue at least for a generation?
I was coming on to make the point that the Scottish National party and the Scottish Government continue to believe that Scotland should, and will in the future, be independent. However, we accept both the result of the referendum on 18 September and the fact that independence will not be the outcome of the Smith commission. What is beyond doubt is that the people of Scotland expect early and substantial change. I am not talking about something that is dependent on English votes for English laws—much as I have sympathy with that as an issue—the West Lothian question or the subsidy argument, from which many people in Scotland will recoil.
Forgive me, I have already taken interventions and want to make some progress. It is likely that I will be the only Member who speaks on behalf of the 1.6 million people who voted yes for independence in the referendum.
What is beyond doubt is that the people of Scotland expect early and substantial change—change that will give the Scottish Parliament the further powers and responsibilities that it needs to tackle the challenges facing Scotland in a way that responds to the views and votes of people in Scotland. That is what was promised in the referendum campaign, and it is what people now expect to be delivered without any conditions.
The hon. Gentleman talks about political parties not making progress. May I draw his attention to the fact that the Scottish National party now has more members in Scotland than the Labour party, the Liberal Democrats and the Conservative party put together? It is currently polling more than 45%, and his party will be reduced to a rump in the general election, which is what it deserves for going into coalition with a party that people in Scotland did not vote for.
No, I will not take an intervention.
The Scottish Government have set out their approach to delivering progress. They propose maximum self-government within the Union. Others would describe this as devo-max, as we have heard already, home rule or perhaps even federalism. The SNP and the Scottish Government argue that further devolution should be underpinned by clear principles. It must respect the sovereignty of the people of Scotland and enhance the financial and democratic accountability of governance in Scotland. As part of this, the Scottish Parliament should have the ability to devolve power further to local communities and authorities. It should transform the ability of the Scottish Parliament and Government to meet the challenges they face and, in particular, enable Scotland to be a more prosperous country, to be a fairer and more equal society, and to have a stronger voice in the EU and internationally on matters within devolved competence. It should be equitable and transparent in its approach to resources, risks and rewards, including arrangements for Scotland to have access to taxes raised in Scotland with transitional or residual transfers of resources based on the current Barnett formula.
The Scottish Government have set out their proposals for extending self-government in Scotland consistent with those principles to deliver full fiscal responsibility for the Scottish Parliament with all tax revenues being retained in Scotland. The Scottish Parliament should have policy responsibility for all taxes unless there is a specific reason for a continued reservation. In particular, the Scottish Parliament should have full autonomy for income tax, national insurance, corporation tax, capital gains tax, fuel duty, air passenger duty and inheritance tax. The Scottish Parliament should be responsible for all domestic expenditure, including welfare, and should make payments to the UK Government for reserved or shared services. The Scottish Parliament should have a sustainable framework for public finances, including the necessary borrowing powers and an agreement with the UK Government on the overall approach to public finances. Our view is that as a part of any agreement the Barnett formula should continue to be used to determine Scotland’s resources.
We are respectful of the Smith process and I await the outcome of the commission. I look forward with great optimism to its proposals being those for which we would all wish.
Scotland should get the financial benefits as well as having the tools to manage the risks of its new responsibilities, and the Scottish Government’s responsibility for all welfare policy and administration should be devolved. As a priority, that should involve all working-age benefits. In the meantime, the roll-out of universal credit and the personal independence payment in Scotland should be halted to ensure that the practical ability to devolve individual benefits is not compromised.
Employment and employability policy, including responsibility for setting the minimum wage and all employability programmes, should also be devolved. Equal opportunities and the equality policy should be devolved. I could go on, because there are many further powers that should be devolved, and that is not just the view of the Scottish National party. The public have been asked about them in a range of academic studies and a series of polls, and it is important that Members are aware of the strength of feeling on these matters.
I have not even read out the statistics yet. I ask the hon. Gentleman to wait to hear them.
In the most recent survey, conducted by Panelbase, 71% of respondents said that they wanted control of all taxation raised in Scotland, 66% wanted control of all areas of Government policy except defence and foreign affairs, which is sometimes referred to as devo-max, 75% wanted control of welfare and benefits, 65% wanted control of policy on the state pension, and 68% wanted control over oil, gas and tax revenues generated in Scottish waters. The list goes on.
I hope that the hon. Gentleman and I agree that such a question will be posed when the people wish it to be posed. The result was not the one that I wanted. It was a no and I am sorry about that. I would have wanted Scotland to be negotiating progress towards independence, but it is not happening now. However, I believe that it will happen in the future when the people wish it to happen.
I have very little time in which to conclude, but let me say that there should be no conditionality on what was promised in the vow. It should be delivered in full and it should not be tied to English votes for English laws or to the Barnett issue, and for that reason we will oppose the motion.
I am delighted that the motion is before the House and I would like to address two particular issues: spending disparities across the UK and the vexed issue of how to implement English votes for English laws. Before the recent referendum, party leaders promised a continuation of the Barnett formula and the powers of the Scottish Parliament to raise revenue. It is vital, if the integrity of political leaders is to be respected and believed, to take this promise to the Scottish people seriously and to work within the confines of the Barnett formula arrangement.
To say that the debate about the referendum did not make people across the United Kingdom think very carefully about the fairness of the allocation of resources is to miss the point considerably. The Barnett formula is just one aspect of the wider question of spending disparities across the UK.
If the hon. Gentleman can contain his anger and listen to what I have to say, he will notice that I have not mentioned the word subsidies. It is he who keeps mentioning subsidy, and it is not in my speech—[Hon. Members: “The hon. Member for Esher and Walton (Mr Raab) did!”] But I have not and I will not.
To have an informed debate about funding reform, we need to think carefully about why the disparities exist. Some exist for reasonable historical reasons. However, differences in health spending, for example, due to different demographics and sparsity issues need to be fully examined and we must have a national debate on them. It is right to say that the case needs to be made for each significant disparity. The whole referendum debate has provoked a discussion in this country and we need to address it.
No, I am going to continue with my speech.
That cannot be done on the basis of one short-term fix. In the next Parliament, the Government should establish a fair funding commission that would look comprehensively at the distribution of spending across all Government Departments over all regions and all aspects of that distribution. It could clearly take into account economic geography, a consistent definition of sparsity, demographic inequalities and historical differences in funding settlements. I believe that it would then quickly become clear that the distribution of taxpayers’ money is complex and that some proposals to deal with spending disparities are too simplistic. Fiscal devolution at a national level is not sufficient by itself. Some residents in Wales might use NHS services across the border in Herefordshire, for example, and vice versa, and it is important that we take account of such scenarios.
We also need to recognise the tension between the needs of metropolitan and rural communities, which particularly concerns my constituents in Salisbury. A fair funding commission would allow us to make mature, long-term decisions about funding levels based on comprehensive data and an appreciation of all the relevant factors across the whole United Kingdom. A wide range of options for reform would be available, including reviewing the baseline for formulas or introducing a fair funding consolidated grant.
I favour a fair funding commission that would examine all funding across the United Kingdom at the same time, not the cherry-picking of reviews. We must ensure that any solutions are led by the will of our constituents. The clear reaction against regional assemblies, following the referendum in the north-east, must lead us to think carefully about the different affinities of different parts of the United Kingdom to the idea that their community, county, nearest city or region should be the locus of power and allocation of resources.
Does the hon. Gentleman agree that attempts at regionalisation in the previous Parliament showed that the British electorate are not interested in new layers of government in England?
Absolutely. I agree. I was going on to say that what our constituents want is to avoid a higher cost of politics, more politicians or irrelevant local talking shops.
The Prime Minister also promised a decisive answer to the West Lothian question in the form of English votes for English laws. I know that some hon. Members will advocate an English Parliament or English assembly. I believe that that would be the wrong reform. The Scottish people voted to stay in the United Kingdom, and this House should respect and applaud that. We should not try to break up the UK by other means; we should not make this place a hollowed out, federal senate or part-time English Parliament.
It is important, though, that we deliver a decisive answer to the West Lothian question. We are fortunate to be able to draw on careful work and thinking on this issue by colleagues on both sides of the House and people outside this place. The principle is simple. English votes for English laws demands that hon. Members from English constituencies have sole final discretion on laws that affect only England. It is not always acknowledged that that issue is related to the Barnett formula, but the formula privileges English spending just as changes in English spending create the Barnett differentials applied to the consolidated grant. For this process to continue to have legitimacy, all hon. Members must be able to have a say on English spending. No one should be excluded from speaking or voting. However, to meet the principle of sole final discretion, there must be a majority of Members from English constituencies finally in favour.
I was just about to say that there is a considerable body of support among Government Members in favour of the proposals for this double majority found in the McKay commission report, but it should be calibrated to ensure that sole final discretion happens in practice and is not just a convention. In the same way as the Barnett formula reform is not as simple as it first looks, I believe that this is not as simple as changing the Standing Orders, as some have suggested. Finance Bills in particular contain a mass of provisions that affect various parts of the UK in different ways. It is not enough to say that discretion can be given to Mr Speaker and his advisers as it is for identifying constitutional Bills.
We will need proposals for a clear test of what is a separate and distinct English issue, whether for a clause or for a whole Bill. These are two issues that we need to get right in order to secure a robust settlement that will endure for the future. We should not advance over-simplistic solutions, but our constituents expect considerable progress on these issues. I hope that, as a consensus emerges, we will not miss this opportunity to legislate properly for the future and to honour the commitments that were made in recent weeks.
If you believe as I do, Madam Deputy Speaker, that the United Kingdom should continue for another 100 or perhaps 200 years, it needs to be built on two solid principles. The first principle is union and the second is devolution. Without those two in tandem, the United Kingdom will be under threat. It is important that we examine the motion before us today in those terms. I suspect that we are not taking devolution as seriously as we should if all that we are talking about is votes on the West Lothian question or the Barnett formula. There is a bigger agenda. Devolution is diminished if we talk only about those two issues. They are a couple of per cent. of devolution for most of us, and for most of us in England, too. Scotland has rightly had a lot of air time, a lot of legislative time and a referendum, but now it is time for England to come to the devolution party, and that is what I want to talk about today.
The Liaison Committee met this morning, and we had in front of us the Prime Minister. The subject was devolution. There were times during that discussion when I felt that the Prime Minister was too chilled out for his own good about devolution. There was a lack of urgency. It was almost as if the problem had been resolved because a referendum had taken place in Scotland. He used expressions such as, “We need to settle this down now,” or, “There is no need to rush these things.” The Scottish referendum was important inside Scotland of course, but outside it allowed us to realise what we could do with a level of engagement and participation that should excite us all given some of the threats to our broader political system in the Union. There are risks.
It is only eight or nine weeks since there was a 400,000-vote difference between Scotland staying in the Union and the Union dissolving. That was just a few weeks ago, yet some of us seem to act as if the problem is over and everything is back to normal, and we have gone back to our default position. Similarly, 23 million people did not participate in the last general election. That is more than the Labour and Conservative vote added together. To imagine that there are not risks and problems in our political system that need to be addressed and can be partially addressed, even largely addressed, by devolution is a dream.
Also since the general election we have seen the rise of an extreme right-wing party. It is polling up to 25% of the popular vote in opinion polls. These are serious issues that can be addressed at least in part and often in large part by giving power back to people, by engaging them in the political system, by involving them and by ensuring that they feel they own their democracy rather than want to vote for an apolitical party.
As for the West Lothian question, it seems strange that the very thing that led to a lot of people being turned off politics and lured by separatism is replaced in our thinking by something that is relatively small beer. It is a Standing Orders question. It is a Westminster-bubble question. I am sorry that the Prime Minister, after this fantastic adventure in democracy in Scotland, was on the doorstep of No. 10 Downing street as the ink on the result was barely dry, talking about English votes for English laws rather than the possibilities of further devolution for the rest of the United Kingdom. Let us deal with the West Lothian question but see it for the relatively small issue it is in the broader aspect of devolution.
On the Barnett formula, of course there will have to be a method of equalisation and redistribution of some description. We are a family of nations and we need to look after each other, just as we do in equalisation in local government.
On the family of nations, I am sure that the hon. Gentleman will agree that taking Scotland and the rest of the United Kingdom out of the European Union would be a bad thing. Does he think it is right that all four nations in the UK should have a safeguard on membership—a double majority—should that case be put? One member of a family dictating to the family would be unacceptable, would it not?
I suspect that the hon. Gentleman, as someone who tried to leave the family of nations, does not speak with quite the authority he may think he has.
What about the positive things we need to address in terms of devolution? It is key—we often say this in the Chamber—that we address the sclerotic over-centralisation of the United Kingdom, particularly with regard to Whitehall. In the big family of nations, we are probably the third most over-centralised nation of the western democracies. Albania is worse than us—that is an obvious example—and, of course, the SNP’s Scotland is also massively over-centralised, sucking up powers on a daily basis. We can hear that slurping sound of local autonomy being sucked into Holyrood, which makes it a highly centralised nation.
Does my hon. Friend agree that one of the issues arising from the current debate on devolution and the Union is that of more powers for our great cities? As the London Finance Commission and the Independent City Growth Commission have set out, there is a strong argument for many of our great cities to be allowed to keep more of their property taxes and to empower people in those cities.
My hon. Friend is uncharacteristically moderate in her proposal on this occasion. I will come to some better ideas that she may care to think about.
To continue the dialogue with my friends on the SNP Bench, double devolution—in other words, taking stuff beyond the devolved settlement and into local authorities, and even into neighbourhoods and communities—is one of the things we need to press when we discuss devolution, rather than run after the bone the Prime Minister threw out at 7 am on the day after the referendum. Such key things need to be on the agenda when we talk about devolution.
Of course, the pledges made to Scotland in the vow have to be pulled together. Indeed, as we speak they are being pulled together in the Smith package. I am used to seeing SNP Members rolling around in agony and crying, “Foul!”, but this is the first time they have done it before the starting whistle of the match has been blown. People of good will in all parts of the political spectrum want this package for Scotland. I want us to do it, first, because it is honest, and secondly, because it will set a bar and a benchmark for what we in England should get as we talk further about devolution to our cities, towns, villages and rural areas across the whole of England.
If we are going to do this, we—particularly my own party—have to come to terms with the concept of giving genuine independence to local government, just as most local governments in most western democracies enjoy. For the first time in this country, local government would be equal rather than subordinate and supplicant, holding out for, in effect, charity from the centre. That needs to be entrenched and beyond easy repeal.
We are opposite the building that used to house the Greater London council, which on the whim of a particular Prime Minister—although it could have been any of them—was abolished, as were other tiers. We need to entrench local government, rather than give it powers that could be taken away at a later date. We need to give it its own life. It is pointless giving people powers unless we give them the right to have what Scotland has pioneered, namely an assignment of income tax to ensure that it can maintain its financial certainty. A second Chamber made up of representatives from the four nations of the Union is also key. Let us not be modest; let us be ambitious for devolution beyond Scotland.
I apologise to the House for not having been here at the start of proceedings. I hope Members will understand that I was having lunch with our former colleague, my great friend Mr Geoff Hoon, a former Defence Secretary who now does sterling work promoting British defence exports around the world on behalf of Westland Helicopters and who is currently based in my constituency.
I salute my hon. Friend the Member for Esher and Walton (Mr Raab) and the others responsible for bringing this debate before the House. It is of enormous importance because, first and foremost, we tamper with constitutional matters at our peril. We should be very, very nervous about upsetting constitutional arrangements. There is no doubt that the devolution process, which was started in 1997 by the previous Labour Government, was designed to be a sop to nationalist sentiment, but far from being a sop it actually fuelled it. I took part in the Scotland referendum, along with my right hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (Michael Moore). I went up to Scotland and as an Anglo-Scot—my Douglas family are on the borders of Scotland—I found it a very depressing experience. I believe it has opened Pandora’s box.
Reference has been made to the vow. [Interruption.] I will make some progress before I let the Scottish nationalists intervene. The so-called vow issued by the leaders of the three main political parties was, I recall, dismissed at the time by the Scottish nationalists as just a gimmick. Now they have grasped it as though it were the holy grail. It is as though the vow, which was made out of nowhere, is now the very thing on which they hang. I made it clear at the time, as, indeed, did many people I spoke to on the doorsteps in Scotland, that the leaders could only make those promises subject to the will of Parliament. They cannot just make policies—certainly not policies of such constitutional importance—on the hoof. It had to be a decision of this House and the other place. It should, therefore, come as no surprise that it is not being taken for granted by anybody other than the Scottish nationalists.
I am completely undecided on the correct course to take when a vow that could well have influenced, to some extent, the result of a referendum was given without the authority of Parliament. Does not the whole process show the danger of panic reactions by all three party leaders in the aftermath of a single rogue opinion poll?
My hon. Friend makes a valid point. I think that one of the factors that influenced the campaign in the end was my right hon. Friend the Prime Minister speaking directly to the Scottish people about his passion for retaining the Union and his belief in the importance of Scotland.
Unlike my namesake, the right hon. Member for Knowsley (Mr Howarth), I do not sense that there is any enormous appetite in England for a change in our constitutional arrangements. In particular, I do not believe there is the appetite mentioned by the Local Government Association for devolution of further powers to the English regions. Aldershot certainly does not have that appetite, but it may exist in Knowsley.
That is a very stupid question. The constitutional point is that the leaders of the three parties made a commitment, but they are not in a position to deliver upon that commitment, because it is both Houses of Parliament that make the laws. We do not live in a state where it is the divine right of kings to rule. It is subject to the will of Parliament, and Parliament therefore has to decide on these matters.
No, the question is so silly that it is not worth responding to again.
I do not believe there is any real appetite for change in England. My principal concern—I am sure it is shared right across the House, apart from by SNP Members—is the maintenance of the Union. I am a Conservative and Unionist. I believe profoundly in the Union. I went to Scotland—my wife went on holiday in the south of France, but I could not be out of the country when the future of my kingdom was at stake. I am a former Defence Minister and I believe that the repercussions for defence, had Scotland gone its own way, would have been catastrophic for England. England would have been diminished. I believe that we are enhanced as a nation by having Scotland as part of this great kingdom.
I agree with the hon. Gentleman. I want to see the maintenance of the Union, but surely he must accept that the best way to make sure that the Union continues is to make sure that all the parts of it are content with the arrangements. I am afraid he is wrong; that is not the case at present.
I entirely agree with the right hon. Gentleman. It is important—I was just coming on to make the point—that devolving further substantial powers to Scotland will, in my view, provoke a backlash from England. England has been pretty quiescent. Contrary to what many Scots feel, England is not concerned with what goes on in Scotland. It ploughs its own furrow. If there is not a sensible settlement, I believe that England will rise up. England otherwise gets on with its business, but if it feels that it is being dealt with unfairly, there will be a problem.
Something must be done to address the West Lothian question. I shall set out what I think may be the solution, but first I shall say what I do not want: a long drawn-out boring debate—[Interruption]—on some grand constitutional reconfiguration of the whole United Kingdom. I do not believe that that is what the nation wants or that it would serve us well as a nation.
No. I have given way enough.
I do not want more regional government. My hon. Friend the Member for Salisbury (John Glen) made the point about the situation in the north-east when a referendum was held there. I believe that still pertains. I certainly do not want the abolition of the House of Lords, which is currently the repository of much serious experience and wisdom. The creation of a ghastly senate with some sort of regional representation would do nothing to enhance the democratic accountability that we need in this country.
So what do I want? I want a simple solution. I have been persuaded up till now by the proposal of my hon. Friend the Member for Stone (Sir William Cash), who suggested a change in Standing Orders so that Scottish Members of Parliament are unable to vote on matters which are determined to be solely of English concern. Again, points have been made, particularly by my hon. Friend the Member for Salisbury, about the technicalities that would have to be dealt with in order to arrive at that situation. I quite accept that it could create a crisis, particularly for a Labour Government, for if a Labour Government came to office and their majority were determined by the number of Members of Parliament the party held in Scotland, the Government would be unable to get their legislation through. There is a constitutional issue which my hon. Friends should bear in mind, although it might in the short term be to our advantage.
The best solution is simply to reduce the number of Members of Parliament in Scotland to reflect their reduced responsibilities. That may be the price for maintaining the Union. I believe passionately in the Union and I believe we need to reach out and embrace Scotland. Scotland contributes so much to the United Kingdom. I want to retain Scotland and perhaps that will be the best way of doing it. Although it has been proposed that we should withhold cash from Scotland, I remind the House than when James VI of Scotland became James I of England, his progress from Scotland to London was accompanied by his being showered with gold by the English all the way through England.
Order. Before I call the next speaker, it will be obvious to the House that the excitement of the debate is such, and the number of interventions taken has been so great, that those seven-minute speeches that I asked for have been at least 10 minutes each, so after the next speaker I have to reduce the time limit to five minutes for Back-Bench speeches. There will still be interventions, so those speeches will take seven minutes.
I will try to meet the five minutes deadline. I am pleased to join in this debate. When I first joined the House of Commons in 1979 I held the views that the hon. Member for Aldershot (Sir Gerald Howarth) held. The world has changed dramatically since then, and this debate should much more accurately reflect those changes. So when the hon. Member for Esher and Walton (Mr Raab) invited me to join him in calling for this debate, I jumped at the opportunity. Although on the Order Paper it is described as a debate about the consequences of Scottish devolution, for most of this House it is a debate about England.
My great fear has always been that for quite understandable reasons, for the protection of our privileges, Labour might seem to be wishing not to speak for England. If we are to have a life as a party, it is crucial that we are seen not to be joining the debate, but to be leading it. The worry is that if we protect privileges that may not be our privileges in the next Parliament anyway with a large representation of Scottish Labour Members in this House of Commons, we will increasingly be seen as a party of ghosts, representing a land that no longer exists. Therefore, I jumped at the opportunity to be a co-sponsor of this debate so that, as far as one can possibly ensure, there is a strong view from the Labour Benches—that has already been represented, particularly by my hon. Friend the Member for Birmingham, Hall Green (Mr Godsiff)—that this is an issue on which Labour wishes to lead. It will clutch it to its bosom and debate it constructively, given the results of the Scottish referendum.
I did not think we were in the position that the hon. Member for Aldershot was when he said that he feared that Scotland would go its own way. The truth is that Scotland is going its own way and we need to adjust to that. In doing so there are two big questions that we, as English Members, must answer in a way that is not spiteful or mean and which does not try to trip Scottish Members up. We need to see that they prosper as we wish to prosper ourselves.
One of those two questions is the West Lothian question and the other concerns the Barnett formula. There are siren voices that have been active in this debate since 1977, telling us that we cannot move on constitutional changes unless we have mega conventions to debate the issues. It is quite clear now what the constitutional settlement will be, whether we in this Chamber like it or not. There are going to be four Parliaments, where England has its voice, Scotland has its voice, Wales has its voice and Northern Ireland has its voice. Although some might object to the name senate, there will be a House of Lords much reduced in size and called a senate, which will have the responsibility of protecting the liberties of the four constituent Parliaments and dealing with those matters not delegated to those Parliaments. Only by having such an arrangement can we honestly stand up and say that we have settled the West Lothian question. Some might say that that will somehow create inequality of Members of Parliament, but we have inequality of Members of Parliament now. I cannot vote on some Scottish matters, but Scottish Members can vote on English matters.
The second issue is clearly the Barnett formula. It was interesting that the hon. Member for Moray (Angus Robertson), who led for the Scottish nationalists, would not say when Scotland would return to demand total independence. His phrase was, “It is up to the people.” Scottish Members must understand that while the Prime Minister and the leaders of all the parties may in good faith have said that they will defend the Barnett formula, the next Parliament, which will have a much clearer English identity than this Parliament has, may not wish to honour those pledges.
The starting point for that debate is as follows. Whatever the complications of the formula are, it is totally unacceptable that the poor in my constituency should be less well supported than the poor in Scottish constituencies, let alone the richest people in Scottish constituencies. While of course I agree with my right hon. Friend the Member for Knowsley (Mr Howarth), we do not have to have one or the other. We will have English Parliaments, but we will also see a delegation to the great city regions of England. They are not incompatible.
Clearly, the debate about the Barnett formula has to be comprehensive. It has to take up all forms of support and from different sources. At the end of that we must come to a conclusion that we can all defend to our constituents, whichever part of the four countries we try to represent. That debate will take place. It might be called the Barnett formula. That is where the time will be consumed. The time will not be consumed in deciding what the constitutional settlement is, now that Scotland has, in effect, got the independence it wished for.
It is a genuine pleasure to follow the right hon. Member for Birkenhead (Mr Field). He knows that I have admired him as a parliamentarian since I was first elected to the House almost 22 years ago. His standard of contribution today came up to the same level.
I congratulate Scotland on the turnout for the Scottish referendum. People said it was a colossal outcome, and at the same time a lesson to the rest of us in the United Kingdom—84.59% of people in Scotland voted in the referendum. But it is not quite such a lesson, because when I was first elected to this place in 1992, I was elected with an even larger turnout in my constituency of 85.9%. Why? Because I was elected in a three-party marginal in which most people thought that their vote mattered. That is the key to turnout.
I congratulate those who brought forward the debate. My first point is to the nationalists. I am delighted to see my right hon. Friend the Leader of the House on the Front Bench. I served with him in the Welsh Office when last we exercised all the territorial powers before the Assembly was created. I then led the Conservative party’s opposition in Wales to the establishment of the Assembly. I reiterate that the outcome of the vote that was taken on establishing a Welsh Assembly was a majority of 0.4%. Yet the Conservative party, under the leadership of my right hon. Friend and with my support as spokesman in Wales, fully accepted the outcome of that vote, narrow as it was. The vote in Scotland is 10.6%. That is a very clear outcome, and may I say to our nationalist friends that they would be wise to accept the outcome as well?
We know that we are now engaged in a debate on the offer of powers, but from my perspective, it is important that while we are considering the offer of powers, my right hon. Friend should look for mechanisms to ensure that we get accountability to go with them. I say that because at the moment the computer in my office is receiving lots of messages urging me to be here tomorrow to ensure that the Health and Social Care Act 2012 is repealed because of its impact on my constituents. My constituents are in Cardiff, and they are not impacted by that Act in any way because they are in Wales and the Act applies in England. Is it not interesting that Unison is telling people that the Act applies in my constituency, and that, after all the debate in Prime Minister’s questions between the two sides of the House on the performance of the health service in England and Wales, in my constituency a majority of people still think that health is the responsibility of the Westminster Parliament? That demonstrates that we have not got it right when it comes to accountability.
The other unaddressed question is the West Lothian question. That goes back to the issue raised by Tam Dalyell, but it was also raised by my former law firm partner, the distinguished Back-Bencher Leo Abse, the former Member for Pontypool. He said that there was a basic unfairness there that needed to be addressed. It is unsatisfactory that with all the changes that we have seen, and all the additional powers for Wales that we Welsh Conservatives have supported ever since the Assembly was established—the hon. Member for Arfon (Hywel Williams) knows that—nothing has been done to address this unanswered question. For that reason, the right hon. Member for Birkenhead is quite right: the issue must be addressed. It is not English-centric to say that; it is pointing out that we have a system of asymmetrical devolution, and that because these issues relating to England have not been addressed, we have gone down a road that, just a few weeks ago, might have led to the break-up of the United Kingdom. We must not leave the question unaddressed for the future.
Yesterday’s Evening Standard—not a paper that I read that often, or that I always agree with—noted that the political system was in danger of collapsing, that the financial crisis had caused an economic meltdown, and that the MPs’ expenses scandal, media phone hacking, and police corruption had eroded trust in the established institutions. People are turning away from the established parties, and in England the response has been increasing support for an insurgent political party that, ironically for Members from nationalist parties, offers more Westminster, more privatisation, more austerity and more neo-liberal economics.
In Wales and Scotland, people are increasingly persuaded that a different political direction and social justice will be secured by empowering our national democratic political institutions. I was sceptical about the Unionist vow to Scotland, and am even more so now, given the twisting and slithering from the Unionist parties.
I will not give way. I do believe that some powers will be made over to Scotland, though I suspect that these will fall short of devo-max, modern home rule, or the new federalism proposed by the no campaign. In Wales, national political confidence is growing. Independence is a goal for a minority, but importantly, the majority of Welsh people reject the status quo.
I thought that the hon. Gentleman might raise that point. Support for the status quo was at 37%; 63% of the population wanted a change, and the poll offered four choices. I said earlier in my speech that a minority supported independence, and I am one of that minority.
I was very glad to allow another Welsh Member to take part, and ironically, he made a point about Scotland. He is entirely right. I wish there were more Welsh Labour MPs here to participate in the debate.
During proceedings on the Wales Bill, we warned the Government that the Bill would be superseded by events in Scotland, which I think has indeed been the case. After the referendum result was known, the Welsh First Minister, Carwyn Jones, called for home rule all round. When asked what powers he wanted, he could suggest only a reserved powers model. That is important, but it is unlikely to inspire the sort of enthusiasm and political engagement that so animated the yes campaign.
Looking more closely at Labour, it seems to have seized Carwyn’s plan much as a shipwrecked sailor might hug a bobbing, upturned piano—sufficient to keep him afloat, but unconvincing as a permanent solution to his predicament. Labour’s predicament is founded on being petrified of plans for English votes for English laws and their failure to adopt devo-max many years ago, not to mention being horribly tainted by campaigning shoulder to shoulder with the proudly Unionist Tory party. The shadow Secretary of State for Wales, who is not in his place, memorably calls himself a proud Unionist. I am surprised that he is not here to proclaim that Unionism.
Carwyn Jones made a big play about his call for a constitutional convention, as we see Labour doing in its rejected amendment. I tabled a question to the Deputy Prime Minister last year, asking what representations he had received from the First Minister on the matter. His answer was “None”. Carwyn was proclaiming a constitutional convention but had done nothing about it. Calling for a constitutional convention is clearly a simple Labour holding line. It is too little, too late, catching up on what was necessary yesterday—a reserved powers model—rather than the powers required for the future.
In contrast, Plaid Cymru last month published a detailed position paper, “Bring our Government Home: Proposals for empowering Wales”. It calls for the Wales Bill to include all the recommendations of the Silk commission, rather than the cherry-picking we saw from the UK Government, and, crucially, for a second Wales Bill to mirror the powers that will be made available to Scotland. It would be a balancing Bill, at last ending the practice of Wales playing catch-up with Scotland.
The people of Wales want parity of powers with Scotland. As I mentioned, a poll taken almost immediately after the vote in Scotland found that 63% of people wanted parity with Scotland. The Westminster parties ignore that, and it will be to their cost. They have vowed that the Barnett formula will stay in place, and the Prime Minister echoed that this morning when he appeared before the Liaison Committee—he said very clearly that Barnett reform was not on the horizon. We say that the case against the Barnett formula has been proved in Wales. Even the Labour First Minister says so.
We say that we must have funding equality with Scotland, which means that on a pro-rata basis Wales should receive an extra £1.2 billion a year. That goes well beyond the current Wales Bill. Plaid Cymru’s ambition is to improve the Welsh economy so that we can stand on our own two feet. That will not be achieved in the long run while we depend on fiscal transfers from London. To speak plainly, the Welsh Government need a kick in the pants. Growing the Welsh economy can be achieved only through fiscal empowerment.
Lastly, on English votes for English laws, there are several important considerations to be resolved before that can take place. We heard earlier that only eight pieces of legislation over the past four years could be identified as English-only. The point has been made that changes to the NHS and its funding in England have profound implications for Wales. The hon. Member for Cardiff North (Jonathan Evans), of course, has many constituents who access the health service in England. I cannot see how English votes for English laws can be introduced simply, but I think that it is a fair principle if it can be done. The obvious solution, as far as we are concerned, is to fully empower the National Assembly for Wales, the Scottish Parliament and the Northern Ireland Assembly.
It is important that today’s debate is based on fact and reality. Given some things we have heard from outside commentators, and unfortunately from some hon. Members from time to time, one might think that we had a situation in which taxpayers in England are generously subsidising those in Scotland, and that Scottish MPs have been responsible for imposing legislation on residents of England against their will. That description is vastly at variance with reality, as hon. Members will know. Of course, I accept the straightforward reality that the level of Government spending per head in Scotland, Wales and Northern Ireland, as defined by Barnett, is slightly higher than that in England, taken as a whole, but the Barnett formula does not present the full picture. Indeed, Lord Barnett never suggested that it did.
The definitions of public spending in the different nations are not necessarily like for like. For example, water supplies in Scotland are in the public sector, whereas in England and Wales they are privatised, so in Scotland spending on water is counted as public expenditure, but in England and Wales it is not. The formula does not fully reflect the public expenditure involved in some of the activities of central Government and the state that are centred here in London. The activity of the state that we see in front of us every day in London generates an immense boost to the economy in the whole of the south-east of England. That is an economic stimulus that nowhere else in the UK enjoys to anything like the same degree.
He did say that, but it did continue, and fairly successfully.
If one compares the relative figures for Government expenditure throughout the different parts of the UK, what is most striking is not the disparity between the averages in Scotland, Wales and Northern Ireland as opposed to England, but the vast disparities within England. I have some sympathy with the complaint of the hon. Member for St Albans (Mrs Main) about the lack of Government spending in her constituency, because the south-east of England—her part of the country—gets two thirds less than average spending in London. London gets 20% above the average across the UK—higher than the relative advantages for Scotland or Northern Ireland.
Let me emphasise that just as I reject setting Scotland against England, I do not seek to set London against the rest of the UK. There are vast disparities of wealth within London, and the economic activity that it undertakes generates burdens as well. My point is that the Barnett formula is only part of the picture. It is a formula for spending, but not one based on a real needs assessment—that is widely accepted. For example, it does not take account of the costs for Government services of remoteness, or of levels of poverty or other social need. Nor does it take account of the contribution that different parts of the UK make to central Government revenues. Scotland is one of the highest contributors of taxation to central Government revenues—the third highest, I think, in the UK. Different areas and nations put more in; different areas and nations take different amounts out.
Let us get away from the idea that the Barnett formula is a subsidy for Scotland, Wales or Northern Ireland. We are in a state where different nations and different parts of nations will contribute in varying degrees to Government revenue, and different nations and different parts of nations will see Government expenditure at varying levels. I welcome that, because I believe that the strength of the UK is that, with the right Government and the right policies, we can pool and share resources. Indeed, there has not been enough pooling and sharing of resources to tackle some of the real poverty that we see in communities in cities, regions and rural areas throughout the UK.
On English votes for English legislation, there is of course an anomaly. I am not for one minute diminishing the concerns that have been raised in the House, but I wonder how far they are shared among the general population of England. Obviously, MPs from England will know that better than I do.
I agree, however, with my hon. Friend the Member for Nottingham North (Mr Allen) that this issue can be relatively simply dealt with and does not, in any sense, justify any delay in the further devolution that was promised before the referendum. There must not be a cherry-picking of certain bits of political reform that suit the short-term political interests of one or other political party. We can all point to the history of anomalies that this constitution—this state—has had over decades. In the old days, there was the situation with Northern Irish MPs being able to vote as supporters of the Conservative party. There is the whole anomaly, to put it mildly, of the House of Lords. We have to recognise that we need political reform to deal with the alienation of so many people from our political system, but it should not just be piecemeal. It needs to address House of Lords reform. Electoral reform needs to be back on the agenda. The whole issue of regional government in England and Wales needs to be taken seriously. There needs to be root-and-branch reform that is based on respect between the various nations of the UK, and a recognition of the seriousness of the political crisis that is facing politics across the UK.
Now that the Scots have had their say, now that there is a London Mayor and a London Assembly, now that the Welsh have their Assembly, and now that Manchester is to get a metro mayor with new powers, people in the west midlands are asking, “What about the rest of us?” I want to argue that in this new era of devolution, the west midlands and other English regions should be granted a fairer share of public spending, as well as new powers and greater freedoms.
The truth is, first, that people in England clearly do not think that the current arrangements are fair. Secondly, the fact that our economy is so unbalanced—with business, finance, the professions and, as a result, growth and wealth concentrated so heavily in London and the south-east—shows that the arrangements do not work for most of Britain. Thirdly, there is clearly a crisis of trust in politics and government.
I think that changing one part of the system, as has happened so far, causes all sorts of problems elsewhere—tugging at one thread of our constitution risks unravelling the whole thing—which is why we need a proper constitutional convention to examine all these matters. The response to greater powers for Scotland is devolution to the English regions, with more decentralisation, more services being delivered and run by local communities, local councils and people themselves, and a fairer share of public spending.
In the west midlands, we have world-beating businesses, such as Jaguar Land Rover and JCB, and world-beating universities, but we have too many people out of work and we have real problems attracting investment for the new industries and jobs that we need to replace the ones we have lost. Output in the west midlands has lagged behind the national average since 1976. If output in the black country alone matched the national average, our economy would be £8 billion bigger. That shows that the current situation is not working for people in the west midlands.
I want the west midlands and other English regions to have wide-ranging new powers, and responsibility for public spending on strategic regional issues, such as regional transport, regional planning and regional economic development and skills. Public spending on services such as housing, regeneration and infrastructure—they are currently delivered in the region, but often by officials accountable to Whitehall—should be decided in the west midlands. I want a Minister for the west midlands with the same powers as the London Mayor, so that decisions that affect the people of the region are taken by people in the region.
I would decentralise further still. I want more services devolved to regional cities, towns and boroughs, and then to communities and individuals. Next, I want Departments moved out of London completely. Why not base the Department for Culture, Media and Sport in Manchester, the Department for Environment, Food and Rural Affairs in East Anglia and the Department for Business, Innovation and Skills in the west midlands?
I am very sympathetic to the idea of having a Minister for the west midlands, but why should such a Minister be appointed by a Westminster Prime Minister, while the Mayor of London, with the same powers, is elected by the people of London?
We can look at all those arrangements, but at the very least we should start by having someone in the region who is responsible for all such powers. I must say—I would say this—that when I was the Minister for the region, I thought the arrangements worked quite well, but let me make a bit of progress.
Moving Departments wholesale to the regions would not just save the taxpayer a fortune, but would mean that civil servants were a lot closer to the communities that their decisions affect, that the economic impact of public spending and civil service jobs was spread more evenly across the country, and that pressure on public services and the overheated London property market was reduced.
We need a review of the way in which public spending is distributed, and a new system that guarantees fairness across the country. Official figures show that public spending is £8,498 per head in the west midlands, compared with £10,100 in Scotland, £10,800 in Northern Ireland, almost £10,000 in Wales and £9,000 in London. The national average is £8,788, so public spending is higher in the north-east, the north-west and Yorkshire and the Humber than in the west midlands.
I recently sent a detailed survey on all these issues to thousands of my constituents. The responses showed that there is huge support for dealing with decisions about England in a different way. Eight out of 10 people said that we need a new system. Two thirds of them supported the idea of having directly elected mayors, as my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart) will be pleased to hear, who are responsible for greater powers in regions such as the west midlands, while just four out of 10 were in favour of having new English Ministers.
The clear point is that the vast majority of my constituents feel that if it is right for Scotland, right for Wales and right for London, then the 5 million people in the west midlands and its cities, towns and boroughs should also have a greater say over public spending and public services in their region. They are asking why people in Westminster who have never lived or worked in the west midlands should make decisions about our priorities.
This debate has settled on three issues: the Barnett formula, more powers for Westminster, and, of course, the famous vow.
The hon. Gentleman makes the important point that the commitments made by leaders in the referendum played a part in its result and need to be honoured. To that extent, will he say to his new leader that she should honour the commitment made by her predecessor that this was a once-in-a-lifetime referendum, and that no means no?
I thank the hon. Gentleman for intervening before I made any points, because he has allowed me to say something that I had forgotten to include in my speech. He mentioned the “once in a generation” quote, but I think that must be seen in context—[Interruption.] I encourage the scoffing hon. Member for Dunfermline and West Fife (Thomas Docherty) to do the same, and to look on YouTube where he will find an interview between Jeremy Paxman and Alex Salmond from seven years ago. Mr Salmond was asked whether a referendum would be a once-in-a-generation event, or whatever, and he said that the referendum would either be once in a generation or when there was another electoral mandate for one. He was very clear on that. He said that in his view it should be once in a generation—[Interruption.] Again, Labour Members do not want to hear the truth; they want to invent their own history, and I encourage the hon. Gentleman to look at YouTube because it is clear. Alex Salmond said that a referendum would be dependent on another electoral mandate. He could not bind the hands of the Scottish National party or—more importantly—the wishes of the Scottish people. The next referendum will be when the Scottish people want one, and I hope the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith) will be a decent enough democrat to accept that point. I am sure he will when he reflects on it, as will the scoffing Members on the Labour Front Bench.
Whatever YouTube shows, the Scottish people will make decisions when they want to make decisions. Does the hon. Gentleman accept that after the next election, whatever has been promised, this Parliament may wish to make progress on the Barnett formula?
No, I do not recall that—[Interruption.] I don’t! But again, that should be seen in the context of whether there is a new electoral mandate or other trigger points. It is quite simple and I explained it in response to the first intervention. The hon. Gentleman has delayed progress in the Chamber by making a fatuous intervention that I had already addressed. Let me get back on track and away from the hon. Gentleman’s diversions.
On the Barnett formula—I address the hon. Member for Esher and Walton (Mr Raab) with this point—it must be remembered that London has the greatest per capita payment and highest Barnett spend, with Northern Ireland in second place. That, too, must be understood in context. When people talk about Barnett spending, they mean identifiable spending, which is about two thirds of the spending round pie. There is also non-identifiable spending such as defence, which is concentrated in the south of England. The UK Government seem unable to tell us where defence spending is spent—they used to, but it became a political hot potato. By contrast, the United States of America can list non-identifiable spending not only at state level but at county level, although it seems beyond the wit of the UK Government to identify down to that point.
The review we are looking for, in the context of the Barnett formula, is one with full fiscal autonomy for Scotland where we are rid of these interminable rows and where Scotland spends what Scotland earns. The big point is that Scotland is a wealthy nation that has, each and every year for the past 33 years, provided more tax revenue than the UK average to the Treasury and the Exchequer at Westminster. Members overlook that point.
I am really sorry, but I have been too generous in giving way. Members overlook that point when they talk about the Barnett formula, and the hon. Gentleman may want to come back to it in his summing up.
Like it or not—the hon. Members for Aldershot (Sir Gerald Howarth) and for New Forest East (Dr Lewis) did not like it—the big jumping off point is now the vow. Whether Tory or Labour Back Benchers like it or not, that is the truth of the matter. The vow must be seen in the context of what was happening at the time it was made. On 10 September, the Prime Minister said:
“If Scotland says it does want to stay inside the United Kingdom, then all options of devolution are there, and all are possible.”
The right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), the former Prime Minister—Gordon Brown, for those at home watching who might not be absolutely certain who I mean—said:
“The purpose of the Scottish Parliament should be to use the maximum devolution possible”.
I am always delighted to follow your guidance, Mr Deputy Speaker. If they want to strike it from the record they can. I was trying to make a wider communication point, but I understand and respect what you are saying.
The vow was surrounded by those remarks and the vow ended the option of the status quo; it moved the argument on. The muddle, of course, is what is meant by the vow. In this Chamber, I asked the right hon. Member for Kirkcaldy and Cowdenbeath whether, when he signed up to the vow, he knew what he was signing up to. My suspicion, after the Downing street EVEL declaration on the morning after the referendum, is that he was duped. He will know whether he was or not.
I am not sure what the three amigos meant by the vow when they signed up to it on the front page of the Daily Record. The “three amigos” is the collective name in Scotland for the leaders of the Labour, Liberal and Conservative parties—they are seen as much of a muchness. [Interruption.] There they go—the cackling starts again. I suspect that before the referendum the vow meant anything at all to keep Scotland within the Union. After 18 September, they meant it to mean as little as it possibly could.
On the Smith commission, we know what the Scottish people want: they want Scotland’s Parliament to control many areas of policy. Polls show that they not only support the Scottish National party; they support income tax, corporate tax, welfare and benefits, and pensions being dealt with in the Scottish Parliament. If the Smith commission fails the people’s hopes, the polls show that people well understand who the champions of Scotland are and who will put Scotland first. That is why the SNP has between 45% and 59% support in the polls. The complexion of this Parliament will change next May as a result. There are many trigger points that could cause a new, second independence referendum in Scotland. One is an exit from the EU. Another—the most likely—is the demand of the Scottish people for power to go to their Parliament to change their lives, their communities, their families and their neighbourhoods.
It is always a great pleasure to follow the hon. Member for Na h-Eileanan an Iar (Mr MacNeil). I am surprised he has been able to speak in this debate, because he has been telling everyone that the SNP was restricted to one speaker. As I understand it, he actually applied to speak some time ago. Perhaps we can get a bit of reality into these debates, because they are incredibly important. I am very grateful to the hon. Member for Esher and Walton (Mr Raab) for securing the debate, because it is very important that we discuss these matters in the light of the independence referendum.
I would like to reflect on the comments made by the hon. Member for Moray (Angus Robertson), who is not in his place. He made what I think was a rather disingenuous speech, saying that he was speaking in this House on behalf of 1.6 million people. I thought he would be representing his constituents. I will be speaking for everyone in Scotland, because that is what we are here to do. We are not here to rule out those who voted yes or those who voted no. I hope he will think about that.
Devolution has changed the country for the better, and Labour is the only party that has consistently been the party of devolution. The Conservatives were against it in 1997 when one of the first Bills in Tony Blair’s first Government was for a referendum. Thankfully the Bill was agreed by a large margin and the Scottish Parliament came into being. The previous Labour Government set up the Calman commission to put in place the next stage of devolution, and that journey has continued: the Scotland Act 2012 will be implemented in stages up to 2016, and in recent weeks, the Scottish Finance Minister has announced the devolution of stamp duty and landfill tax and what that tax landscape will look like.
Devolution has always been a journey, and Labour has always been the party of devolution. That is why I am surprised by the motion. My hon. Friend the Member for Dudley North (Ian Austin) gave some superb examples of how devolution could help the English regions. However, this area is so complex that I cannot understand why some Members will not accept the need for a constitutional convention. It is incredibly important. If we learned anything from the referendum it was that when we involve people they tend to get engaged to ensure we do what is right for local communities. If politicians cook up something in this place, it will not be accepted around the country, which is why a constitutional convention is the most important thing.
For that reason, it was disappointing when the Prime Minister stepped out of Downing street before it was even light, after the results of the referendum, and completely trashed what had been said to him as the results were coming through. The vow was clearly in place. It said we would keep the Barnett formula and that more powers would be devolved to the Scottish Parliament. Crucially, however, the cross-party Smith commission, which has Liberal Democrat, Conservative, Labour, Scottish nationalist and Green representation, has been set up and is due to deliver a negotiated settlement on time. I was incredibly disappointed, therefore, that the hon. Member for Moray, when pressed, did not say that he was looking forward to the Smith commission or that he would abide by its conclusions. It sounded as though he was hinting that he might agitate, even though it will be a negotiated settlement.
It is up to us as politicians to listen to what the people of Scotland said, and they said they wanted to stay within the UK and that they wanted more powers for the Scottish Parliament.
I will try to do my best for the hon. Gentleman. When the former leader of the Labour party in Scotland, Johann Lamont, left her position, she muttered something about a branch office and the dinosaurs in this place. Does he recognise any dinosaurs among his hon. Friends?
I knew that would be a waste of an intervention. Many Scottish Members want to speak, but the behaviour of the SNP today has been appalling. I wish it would engage with this issue.
People want politicians elected to represent them to talk about the things they tell us about, and we have listened to the Scottish people. SNP Members might not believe it, but it was a no vote. Their own leader said that would be it for a generation, yet they have even been talking about unilateral declarations of independence. The people have spoken, and politicians must listen. The Smith commission’s recommendations will be out next Thursday and will be implemented as per the plan. That was the vow to the Scottish people, and it will be followed through. It is part of a variety of devolution measures that this party has delivered and which are still to come.
I will not give way because I want other Members to speak and time is ticking on.
A constitutional convention would deal with all these issues, alongside devolving £30 billion to the English regions, reforming the House of Lords and turning it into a regional senate, and further devolution for Wales.
These are important debates. We should have more Government time in which to explore these issues properly, but it is clear that the devolution vow and promise made to Scotland will be carried through—separately from all these other issues about English votes and devolution elsewhere in the United Kingdom. This is a view for the whole of the UK and we should do it on that—
Let me pour a bit of oil on this heated debate and remind us of its title, “Devolution and the Union”. All of us bring to these debates some personal experience. For the first 18 years of my life, I lived in a federal state, not in a union. Those who talk about federalism need to be reminded of just what it means. I also spent 18 months on a constitutional convention, so I know what that means, too.
Let us consider three terms. First, what does devolution mean? No one could argue that Labour has not been the architect of genuine devolution within these British Isles. In many ways, the one piece of unfinished business has been devolution in England outside London. We must reflect on that, because we cannot have devolution in the constituent parts of the United Kingdom unless there has been proper devolution in the largest part of that United Kingdom.
The second issue, a puzzling one, arises when we talk about money. I think we have completely forgotten the purpose of transfer payments. The centre collects money in order to redistribute it to the regions according to need. That is the nature of our Union. It is not a vehicle for increasing separatism and it is not a vehicle for increasing special pleading: it is a vehicle of unity, a vehicle of bringing disparate parts together in a fair and proper manner.
The third issue is how our electorates in a United Kingdom and a Union relate to that. What I find really troubling about this whole debate is that those who are strong advocates for devolution sometimes use it as a means of breaking up the Union. If people do not want a Union and they want federalism, they should be clear about what that would mean. As a structure in which one part is disproportionately larger than the others, federalism does not work. People say, “Isn’t it great how Germany works as a federal state?”, but speaking as a German who grew up in Germany, let me remind the House that the only time federalism worked in Germany was after Prussia had been broken up. I would not recommend the Prussian model as one to follow. If people want to follow it, okay, but they should be very cautious.
Federalism in the UK would be deeply divisive. The rest of Europe looks at the model of the Union in the UK as something that this country got to a couple of hundred years before everybody else did, and they admire and envy us for having done so. I find it quite extraordinary that some are trying to go back on that. Let us remind ourselves that the transfer of money is in order to represent the United Kingdom as a Union—
I promise the hon. Lady that if my speech appeared like that, it was because of the barracking and level of discourtesy I had to deal with from Labour Members. I apologise to her, and doubtless she would want to apologise for her colleagues. She talks of money transfers, so let me ask her in which direction she thinks these transfers are going.
When my children used to behave badly, they blamed their big brother, but it always takes two to pick a fight. I would have thought that the hon. Gentleman was too big and too grown up to be goaded by anyone, so let us come back to the transfer, which is what we are arguing about at this stage. It does not matter what we call it. I have to say that the impetuous behaviour of the Prime Minister after the referendum brought about much of this trouble, and I wish that he had been a little more grown up and reflective.
Arguments about money involve equal and fair distribution and democratic representation. Scotland had a referendum, for the second time in my lifetime. Some Members may be too young to remember the first referendum, but I do. This is the second occasion on which the Scottish people have spoken decisively on where they wish to be. There must come a point at which we must simply accept what the people have said.
I agree with my hon. Friend the Member for Dudley North (Ian Austin) that devolution in England outside London is unfinished business. I think that we must look much more closely at taxation powers for the city regions. Ultimately, however, when we argue about money, we should bear in mind the fact that it should be used as a mechanism to bring people together and to bring greater fairness. It should not be used as the divisive mechanism for which I think some Members are currently trying to argue, because that would be a very, very bad way of going about things.
I want to speak on behalf of a group in my party that is little heard of, but involves a long tradition of support for home rule for Wales. It goes back to the time of Keir Hardie, who represented a Welsh constituency. For me, it goes back to the time in 1953 when, as an 18-year-old schoolboy, I marched through Cardiff with a plaid Lafur—Labour party—banner reading “Senedd i Gymru”: “A Parliament for Wales”. That strand has always been there in the party, although it has not always been dominant. It is, to me, a cause for celebration and pride that, after all the generations that have come from Wales for the last 100 years promising devolution and home rule, I had the chance to be here when we delivered on that. It may not be a full Parliament—perhaps it should be described as half a Parliament—but it is a developing Parliament.
I stand here as someone who, for various reasons, has had a lifelong commitment to home rule. I believe that there is a stronger personality in Wales than in almost any other area. We are aware of the distinctive characteristics of other areas, but we have an ancient language—a 2,000-year-old language. In my constituency 2,000 years ago, the children who were intra muros, within the boundaries of Caerleon, spoke Latin, while those who were ultra muros, outside the walls, spoke Welsh. They still do—not all of them, but Welsh is still heard on the lips of the children, although we do not hear a great deal of Latin nowadays. That says something about the resilience of the language.
When István Széchenyi, a litterateur from Hungary, was asked “Where is the nation? Where do you find it? Where do you look?” , he replied:
“A nation lives in her language.”
All the wisdom, all the hurt and all the folklore of our nation echoes down the centuries in our distinctive language, and, to our great pride, it is now being spoken by more people than at any time in history. Every child in Wales has a chance to learn some Welsh, and many learn it and become fluent. The roots of a great renaissance of Welsh personality and character is there.
It is crucial that we have political institutions. Someone suggested that Carwyn Jones had never expressed a commitment to a constitutional convention. I am one of those who slave away on the Political and Constitutional Reform Committee, and anyone who delves into our fascinating, page-turning reports will find that we have to go through the delicate process of building up a constitution. However, I think that we are being a little unambitious in suggesting that there might be four Assemblies. I have been very surprised by the extraordinary change in the Republic of Ireland following a visit by the Queen, who put on a green dress and stood in Croke park, bowing her head in penitence. A century of antagonism has not melted away, but it has certainly softened a great deal. I can see a possibility that within, say, 20 years there will be a federal system in which we can all join.
It was suggested in The Guardian this morning that the next Head of State—
Order. Members should address the Chair. The last two speakers have felt the need to face in the opposite direction rather than facing the Chair. I think that the hon. Gentleman wishes to give way to the hon. Member for Na h-Eileanan an Iar (Mr MacNeil). I hope that Members will address each other through the Chair from now on.
The hon. Member for Newport West (Paul Flynn) is making a thoughtful speech. Does he think that the Republic of Ireland would have had the same success without the powers that it now has under independence, or what we might call total devolution? Does he think that those powers have contributed greatly to what Ireland has now?
I shall tread carefully here. I do not want to get involved in the Scottish situation, on which we remained silent throughout the referendum. Members of my family were in the Irish Anti-Partition League and in Sinn Fein in the 1920s. All those divisions were there, although of course we hope that they will come to an end. That has certainly been part of the history of these islands, and we should rejoice at what has in many ways been a happy outcome for Ireland, after the misery and suffering of previous centuries.
We are now in a delicate position, because what happened in Scotland is having repercussions. The vow must be respected. There is no question of turning back on that; if we do, there will be a wave of cynicism from Scotland and elsewhere. No referendum solves everything; it is never a final moment. I recall the 1975 referendum on Europe, which hardly settled things in that regard. The entrenched opinions became more deeply entrenched, and that continues to this day, with people still feeling dissatisfied with the result.
In Wales, there was a tiny majority in favour of devolution in 1997, but the next time a vote was held, 65% of the vote was in favour. Huge changes are taking place. When we campaigned for a Welsh Assembly, there were those who said that we were on a slippery slope. Some were against devolution because it represented a slippery slope towards more independence in Wales; others supported it because they were in favour of just such a slippery slope. If there is one certain way of ensuring the break-up of the United Kingdom, it is to arouse the sleeping giant of English nationalism. We have heard about this today, and as the antagonism—
I thank the hon. Member for Esher and Walton (Mr Raab) and the Backbench Business Committee for sponsoring this important debate—the second on devolution in this Chamber since the Scottish referendum in September—although I regret to tell him that I will not be supporting his motion, for the reasons that I will set out.
In that first debate, the House paid tribute to the campaigners and the energising effect that the referendum had had on Scottish democracy, with record turnouts, the public re-engaged in politics, and a decision made about our country’s constitutional future. I hope that we can focus in this debate on why the enduring strength of devolution in the UK won the argument, and on how we can make radical changes to our democracy across the UK which can satisfy people who voted on either side of the referendum in September, as well as the millions more across these islands who want a more decentralised, more democratic and modernised polity in the UK.
Let us be clear about what the current and future parties of Government at UK level put to the people of Scotland in September: increased financial powers to the Scottish Parliament; the retention of the funding model that involves fiscal pooling and adjusting changes in the allocation of resources through the Barnett formula; and the effective entrenchment of the devolution settlement. That promise was not lightly made, and it should be unbreakable and unconditional in its nature, with draft legislation by the end of January and an Act in place early in the next Parliament. That promise was endorsed by the people of Scotland in the referendum, and it requires commitments from all parties in this House. To those who support Scotland staying within the United Kingdom, it means having arrangements for the allocation of shared resources that are not to Scotland’s detriment. To those who still support Scotland leaving the UK, it means abandoning the call to end fiscal sharing expressed by some Members in the name of full fiscal autonomy. That is not compatible with the governance of a modern multinational state, would leave Scotland exposed to wildly fluctuating global oil prices and would mean a £5 billion deficit shortfall for Scotland, according to work done by Fiscal Affairs Scotland on the basis of Office for Budget Responsibility forecasts.
Federal states such as Germany, Canada and the USA all have fiscal sharing; Quebec is a net beneficiary from fiscal transfers from the federal Government in Ottawa, and even in Spain there is not complete fiscal autonomy. So, there is not a major nation state on Earth that is governed in the way the Scottish nationalists have proposed to the Smith commission. If other parties must make compromises, the SNP must accept that it must, too, so I was somewhat perplexed by the position taken by the hon. Member for Moray (Angus Robertson) in his speech: he said he accepted the Smith commission process but would not commit to accepting any of its conclusions or outcomes. We should aspire to offer more to people in this debate and across this country than the politics of grievance offered by nationalists of any variety or by the United Kingdom Independence party.
The reason our current resource allocation arrangements have prevailed from the 1890s onwards is a good one: Scotland has one thirteenth of the UK population but one third of the land mass and more than 80% of the UK’s coastline, it contains some of the most remote rural communities in the UK, and it is more expensive to provide access to health and education there on the same basis as in more densely populated parts of the UK. So if we accept that we should have a common statehood—
Would my hon. Friend not wish to put into that equation systems such as Highlands & Islands Airports Ltd, which provides lifeline services to communities in the highlands? Any attempt to run a privatised or commercial service to those islands simply would not work, which is why we need those additional funds in Scotland, in order to be able to fund lifeline services to those island communities, such as those represented by the hon. Member for Na h-Eileanan an Iar (Mr MacNeil).
Absolutely; what my hon. Friend is saying, as I am arguing, is that if we want a common statehood, we must have the right allocation of resources. That means that we can have devolved management of the health, policing, universities and schools services, but we have the same rights, as citizens, to the most important elements of education, free health care, benefits, tax credits and a state pension. Any constitutional settlement for the future of the United Kingdom should not weaken the rights of citizens to those common standards, because to do so would weaken the case for the United Kingdom for future generations.
Similarly, differentiating the voting rights of Members of this House is an issue that could not be definitively resolved by minds as great as Gladstone, Disraeli and Lloyd George in respect of the Irish question in the past two centuries. It may even escape the Leader of the House, the right hon. Member for Richmond (Yorks) (Mr Hague), notwithstanding his grasp of history, and I suspect a neat solution may elude those Members seeking one this afternoon. In truth, few Bills and few motions before this House do not have effects on expenditure in Scotland or other interests. The recent Modern Slavery Bill started life as an England and Wales-only measure but now contains amendments applying to companies based in Scotland, too. Decisions on taxation, even potentially partially devolved taxes, affect the deficit, public borrowing and, ultimately, interest rates. It would be irresponsible for Members from Scottish constituencies not to have a say on such issues in this House.
Order. May I just help Members? I do not reduce the time limit deliberately—I do that because Members keep intervening. If Members want to get in, the only way I can accommodate that is by reducing the limit. So it is no use people tutting at me, as I am trying to help everybody who wants to enter into the debate.
Thank you, Mr Deputy Speaker. I rise to welcome this debate on devolution and the Union, which comes so shortly after that momentous decision in September by the Scottish people, when they voted overwhelmingly to stay part of the United Kingdom and the Union. We should all accept and recognise that democratic decision and the will of the Scottish people. I spent many months on the campaign trail in my constituency, securing a no vote in Inverclyde, which I was glad to see. However, I was not prepared to rejoice in winning that no vote, because I saw the division that had been created in communities across Scotland, even in families, by the referendum. The Labour party has always led on devolution to Scotland and we engage with the Smith commission in a spirit of openness and partnership, and we hope other political parties will do likewise.
More powers for Scotland are guaranteed, regardless of what we hear from others. We guaranteed this during the referendum campaign, and we will also deliver more powers on the timetable we promised. We want the Smith commission to be led by the result of the referendum. The conclusion should reflect the fact that people want a strong Scottish Parliament inside a strong UK, with the continuation of pooling and sharing of resources across the UK.
I want devolution to be more than that, however—I want it to continue and cascade downwards to local government. On the east coast we see the centralising, controlling SNP in power in Scotland, and therefore on the west coast we need that devolution to come our way. We do not wish to see powers simply put on the train from London to Edinburgh and remain there. We need those powers to be devolved to Scottish local government as well. We have seen that while the east coast is given huge amounts of infrastructure and support, the west coast has not been so fortunate. We feel very removed from Holyrood. We should be devolving more powers to local government, which knows the local communities and what they need and should not be overruled from Edinburgh on what it is trying to deliver.
In last year’s autumn statement we saw many hundreds of millions of pounds coming to Scotland to reside in the coffers of the Scottish Government, but we have seen very little of that cascade down into local government, with my local authority in Inverclyde receiving a pittance of 0.1% of that funding to do anything to enhance communities. We needed, and wished for, our fair share to make a real difference. That is what we in Inverclyde see as the essence of devolution—to see that devolution end up on the doorstep, with people feeling that real power can be taken in their communities, and seeing once again, as we saw in the referendum, that when they cast their vote, it can make a real difference.
We have heard much from the SNP Government in Edinburgh about the fact that they would devolve powers, and it is strange that they attack the vow, yet they are unwilling to make a vow of their own—to list the powers they would cascade to local government and make a real difference. Instead everything they accuse this Parliament of, they replicate: they guard and keep the powers to themselves. We need devolution to come down the line to local government.
I particularly welcome the opportunity to speak today because in the previous devolution debate I sat through the entire debate yet I did not have an opportunity to contribute—so it is not necessarily the case that only certain MPs do not get to speak in these debates.
The situation with devolution is quite exciting at present, because for the first time it appears to be moving into the mainstream in a way that it has not done before. My hon. Friend the Member for Nottingham North (Mr Allen) is the Chair of the Political and Constitutional Reform Committee, and I served with him on that Committee for some considerable time. When discussing these issues and producing reports, it felt as if we were the anoraks of politics, talking about the bits that most people are not really interested in. If anything has changed to make people realise that devolution is important for all of us, that can only be a good thing. It is important that people in England start to talk about these issues in a very real way, and realise that there is a lot for them in seeing real devolution of power to local communities. If we get a better overall deal out of all this, that can only be good for everyone. But it has to come, as much as possible, from the bottom up, and it has to involve people who are outwith professional politics. That is why we suggest that having a proper constitutional convention is a big step forward. It happened in Scotland during the 1980s and 1990s, and people did engage on what they wanted out of devolution, which meant that we were then able to proceed very fast after 1997. The Labour Government delivered on their promises as one of their first priorities. We had a referendum, not after three years of grinding debate, but within three months of a general election. It happened in that time scale because of what had gone before. I urge many of my English colleagues to think about how they want to make this happen in a way that makes people feel committed to it.
My hon. Friend the Member for Inverclyde (Mr McKenzie) talked about the need to devolve even further. There are many things that we can talk about while the Smith commission is going on. It must be said that the commission is happening exactly as promised and according to the timetable. Despite that, I received the first e-mail from a constituent alleging betrayal within 12 hours of the result being announced. I do not know how fast some people think that we can proceed.
The timetable is being adhered to, but that does not stop us talking about other things as well. One fascinating thing about Scottish politics is that we have further devolution powers coming to Scotland as part of the Scotland Act 2012, and I have heard very little debate, particularly from the SNP, about what to do with those powers and what we can actually do to make people’s lives better.
One thing I feel passionate about is housing. We need more affordable housing in Scotland. We will have more borrowing powers, so how are we planning to implement them, as they are coming very soon? That is what we should be debating in parallel with the constitutional matters. We should use those powers to do something about social care in Scotland. The position in Scotland is virtually no better than it is in England. I am talking about the type of care that people get, the short time scales and the poor working conditions of many of the carers. If we can use the additional tax-raising powers that we will be getting as a result of the 2012 Act, we should be planning for that now. That can be going on while further debate about the constitution goes on. That is what I want to see happening both north and south of the border. Let us get on with that, as that, I believe, is what the Scottish people want.
I find myself feeling a bit like the right hon. Member for Holborn and St Pancras (Frank Dobson) who was asked if he was in favour of women bishops. He said, “I’m all for women, but not for bishops.” I am all for devolution, but I am not particularly for the Union. I say that as an Irish nationalist sitting here in this House.
However, we must recognise that some issues that have been debated here—there have been some fantastic contributions today—are not just for Scotland or within Scotland. The three GB party leaders rushed to Scotland, like three men in a boat, and all agreed that they all really meant the pledge that they made, but they now cannot agree what it meant. We are left with the question: how now Brown vow? We know that there is a timetable and that there will be clauses of a Bill, but the Bill will not go through until the next Parliament. This does not affect only the people of Scotland, because the Scottish referendum transfixed people well beyond Scotland. It seized the imagination and the interests of democrats everywhere.
Politics falls into disrepute if, as a result of this, we are left with a complete scramble and a mish mash. As we saw with the House of Lords reform, everyone says that they are all for the reform, but they are all able to table different versions of it, and then we have a penalty shoot-out in which nobody scores. That is probably what would have happened today if the Speaker had accepted all the amendments that were tabled. Everybody would have been able to blame everybody else, but the democratic public would have been left no wiser and a lot more frustrated. That is the situation that we need to avoid.
On the work that has to go forward from the Smith commission, a new charter for representative democracy is needed that makes clear the responsibilities, roles, rights and relationships between different Parliaments and whatever institutions in England receive the complementary devolved capacities, or downloadable power options, whether the metro cities, the councils or whatever. The citizen will want to know that those of us in elective politics are clear about the responsibilities, roles, rights, relationships and rules as between those different tiers. They will also want to know that there will be a shared responsiveness to deal with new issues and problems whose shape, definition and implications will change in different sectors and elected chambers. I know this is a bit like “Sesame Street”, with today’s letter being R, but we must also deal with resources and revenue, whether they go through the Barnett formula or any other route that the people want to use.
As a former Finance Minister in Northern Ireland, I am conscious, when I hear people such as the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown) say that the Barnett formula is there to stay, that the Barnett formula means exactly what the Treasury decides. The Treasury decides what it counts into the formula and what counts out of it. I have the bruises from the arguments involved in trying to understand what was what. Basically, the answer was, “We’re the Treasury. We don’t need a reason and we certainly do not need to listen to yours.” The Barnett formula does not give such assurances.
As a member of the Political and Constitutional Reform Committee, I also hear the argument coming strongly from England about the capacities that people want to be devolved. In my own constituency, people would love to see city deal status even within our devolved settlement for the city of Derry. We need to look at this in a more fluid way and to get away from the politics and find the democracy.
Like the hon. Member for Foyle (Mark Durkan), I enjoy injecting a bit of humour into debates in this place. We have much to celebrate about the constitutional decision made by the Scottish people, but I also remember the acrimony of the debate. I remember being abused every single day of the campaign by people who did not support my view. I know that families are divided and friendships have been broken and we must remember that that happens in constitutional debates. Frankly, the levels of intimidation were unprecedented and that is a high bar for me, given that I was involved in the challenges with the Militant and Trotskyite tendencies in the 1980s—as a child, of course.
Despite the SNP’s yes campaign having every conceivable advantage, including the serendipity of two SNP supporters winning the Euromillions—you are so lucky, guys, I have to say—it was still defeated by the Scottish people who rejected the idea of separation because they believed in their vast numbers that a stable system of governance, including Barnett, enables us to absorb difficult economic times more easily than we would if we were component parts within a divided United Kingdom. I accept that Barnett was a formula set up for the short term, but we must also recognise that it has led to long-term stability in the distribution of resources across the United Kingdom. That is where I would differ from the hon. Member for Esher and Walton (Mr Raab), who moved the motion. The suggestion that we tamper with individual items within the constitutional settlement is a bad one and it misunderstands the debate we have just come through in Scotland. The SNP should never be underestimated as opponents and we should never underestimate their ability to be deceitful and mendacious in any campaign that they run.
We can take that from the contribution made by the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) just a few moments ago, when he spoke about the Republic of Ireland. During the referendum debate, he did not tell people in Scotland that it costs €150 to go to accident and emergency in the Republic of Ireland or that it costs €50 to go to see a GP. Wages were slashed by 20% in the Republic of Ireland during the economic crash and so were pensions. Colleagues of mine, such as the Transport Minister for the Labour party in the Republic of Ireland, Alan Kelly, have explained to me the pain that their country had to go through in those difficult economic times. Of course, there was no mention of that in any of the contributions made by the SNP during the constitutional campaign in Scotland.
I was also upset when the hon. Member for Esher and Walton suggested that Scotland is somehow subsidised. I agree with Scottish National party Members on that point—this is possibly the only time I will agree with them—because Scotland makes its contribution to the Union. The difference as regards the Barnett formula is that the income distribution across Scotland is even. Therefore, we do not have to suffer the peaks and troughs when, for example, the price of oil plummets, as it has done since the referendum debate. It was over $100 a barrel then and now it is $80 a barrel—something that the SNP did not want to put into any of the arithmetical calculations that they offered to the Scottish people.
I believe in the devolution of power. I believe in the vow that was made by the leaders of the three main parties. I believe in the United Kingdom and I believe in the arguments in favour of a United Kingdom that we set out to the Scottish people just two months ago. We need a full assessment of the constitutional settlement within the United Kingdom. We need a constitutional convention, and that is why I disagree with the authors and movers of the motion and why I will vote against it later this afternoon.
I am pleased to be able to speak in this important debate on devolution and the Union and I congratulate the Backbench Business Committee on making it possible. I want to speak about the devolution of powers to our great cities in the Union. There is a growing consensus about the importance of growth, if nothing else, and about devolving powers to our great cities. There was last year’s London Finance Commission. There was the RSA City Growth Commission, chaired by Jim O’Neill. The Communities and Local Government Committee held an inquiry into fiscal devolution. The consensus is that our great cities need more local control over policies and funding for provisions such as transport, skills and housing, but that we must also look seriously at the devolution of taxes, starting with property tax.
I stress to Members that this is not about asking for more money. It is not about asking for a bigger slice of the national cake. It is not about the Barnett formula. It is about asking for cities to keep a little more of the money that they raise. This is an issue that does not have to wait for a constitutional convention. Sir Richard Leese, the leader of Manchester council has said:
“Cities should keep more of the money they raise locally so it can be spent on priorities set locally to create jobs and improve lives. The evidence shows that cities with more control over taxes do better economically”.
To show that this is not a party political point, I quote the Mayor of London, Boris Johnson. He has said:
“Now is the time to unleash a new era of civic leadership by giving larger cities greater control over how they spend a modest proportion of the money they raise. This is not asking for more money, instead it is a tried and tested formula applied successfully in other leading world cities.”
One tax that could be devolved is the mansion tax. I support the mansion tax. It is a redistributive tax, which I always think is an excellent thing. My right hon. Friend the shadow Chancellor is to be congratulated on his continuing listening ear and willingness to refine it. As always, my right hon. Friend the Member for Morley and Outwood (Ed Balls) is our flexible friend.
However, there are some cons to a mansion tax. In London, for instance, with a wildly distorted housing market and stratospheric house price rises, a Hackney teacher who bought their house 30 years ago, not to speculate and make money but to live in, could find that a house that cost them tens of thousands of pounds is now worth over £1 million. Those stratospheric house prices will make Londoners, even though their house will come in under the £2 million that we are talking about, nervous about a mansion tax. I believe that the answer is to hypothecate the tax to a housing authority for London and spend the money on affordable housing—not Boris Johnson’s ludicrous 80% of the market rate but genuinely affordable housing.
Some of the money could also be spent on giving mortgages to key public sector workers. I recollect that my very first mortgage was from Westminster council. It handed out mortgages because it thought that it made Tories out of people. It did not work with me, but it was still a good idea.
There are huge issues relating to Scotland and the Barnett formula and there are very specific issues that should be addressed now about giving new powers and control especially over new property taxes to our great cities, and I hope that the House will consider that carefully.
I congratulate the hon. Member for Esher and Walton (Mr Raab) and those who sponsored his motion on their success in persuading the Backbench Business Committee that this was a suitable subject for debate. The extremely interesting, fascinating and lively debate we have had demonstrates that the Backbench Business Committee was probably right to choose it.
This is a topic of obvious relevance to all of us as we seek to adapt our unwritten constitution to meet the rapidly changing expectations of our constituents and yet ensure that the whole is coherent and greater than the sum of its parts. We must seek to do that in an era when much political endeavour is seen through a prism of coruscating cynicism and where genuine and open debate is hard to sustain. To counter that, it seems obvious to me that we must begin by delivering on our promises, which is why Labour believes very strongly that it is imperative that we deliver, to the agreed timetable, on the vow that all leaders of the main parties made to the people of Scotland just prior to the referendum.
Our amendment, which was not selected, notes that
“the commitment made by the Prime Minister, Deputy Prime Minister and Leader of the Opposition to the continuation of the Barnett allocation of resources and full representation for Scottish MPs in the UK Parliament”
is equally important and needs to be borne in mind. The Prime Minister told the Liaison Committee this morning that reform of the Barnett formula was “not on the horizon” and that
“if you took all the extra money that Scotland gets from the Barnett formula and distributed it amongst the 55 million people in England, it’s not a pot of gold”.
He made the obvious assertion that 55 million English people do not get quite so big a share of the Barnett formula deliveries as 6 million Scottish people get. In essence, if the Barnett formula is reformed, the hope that England will somehow be full of all the things it needs is probably not an accurate view.
I have never been a conservative by instinct or, indeed, by any kind of inclination. I have long believed that the way in which this country is governed can be improved, and I think it can be improved significantly. Labour believes that the current system of governance for all the nations and regions of this country is far too centralised and not nearly democratic enough. We believe that we need a much more fundamental shift of power away from London and Whitehall, and we have a radical plan for spreading power and prosperity across the great towns, cities, regions and nations.
The following Labour Members have contributed to the debate: my right hon. Friends the Members for Knowsley (Mr Howarth), for Nottingham North (Mr Allen), and for Birkenhead (Mr Field), and my hon. Friends the Members for Edinburgh North and Leith (Mark Lazarowicz), for Dudley North (Ian Austin), for Edinburgh South (Ian Murray), for Birmingham, Edgbaston (Ms Stuart), for Glasgow North East (Mr Bain), for Inverclyde (Mr McKenzie), for Edinburgh East (Sheila Gilmore) and, last but by no means least, for Hackney North and Stoke Newington (Ms Abbott). There has been a consistent drum beat in favour of having more and better sharing of powers from the centre to the cities, counties, regions and nations of this country. We need to enhance real democratic involvement, not watch it diminish through reduced involvement and cynicism.
When the Hansard Society’s annual audit of political involvement shows that only 7% of people strongly believe that if they got involved in politics they could make a difference, and when voter turnout has been in decline, it is obvious that we need to act to bring forward profound change if we are to strengthen, reinvigorate and renew our democracy. But that action must not be some kind of partisan Westminster cooked-up insider fix, which is why we in the Labour party have called for a constitutional convention to be established to review and make recommendations in relation to future governance arrangements for the whole of the United Kingdom. We want to reverse a century of centralisation by devolving tens of billions of pounds of funding to the regions and local government. We also believe that proposals should be brought forward to replace the House of Lords with an elected senate of the nations and regions. We believe that there should be a new Scotland Act, but we also believe in an English devolution Act. If we form the next Government, we will bring both those things forward.
The advent of the Scottish referendum and the dramatic campaign it produced is a tribute to the power of lively democratic debate to banish complacency and galvanise politics as a whole. Little wonder that it has promoted not just the commitment to a further devolution of power to Scotland, but, as many have pointed out, a wider debate about political power in the whole of the UK—who has it and how they use it. I want to address specifically the further powers to be given to Scotland and I want then to set out Labour’s proposals for devolution for the rest of the UK. Finally, I want to talk about why it is important that we approach any conversation about constitutional change in a consensual and not a petty partisan way.
In September, the Scottish people, for the first time in their history, made the decision in a referendum to remain part of the United Kingdom, but they also voted for change, not the status quo. I spent some thought-provoking and exhausting days campaigning in Scotland to maintain the Union, and it was clear from the many people to whom I spoke that they simply were not satisfied with business as usual. The conversations I had emphasised the truth. For too long the Scottish people have felt disempowered and alienated from decisions taken in Westminster. But it struck me forcefully on those Scottish doorsteps that the alienation and the feeling of powerlessness would be mirrored on a great many English doorsteps too. I come across it wherever and whenever I knock on doors. The answer to it is a deeper, more meaningful democracy with more profound devolution across our nations. It is not the politics of separation, grievance and divisive nationalism.
Labour has led the way on devolution to the Scottish Parliament. We passed the Scotland Act 1998 and brought the Parliament into being, and I am glad that we are continuing to develop it now. The former Prime Minister, my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown), has set out a timetable for further devolution to Scotland, which is well on track. The three main parties all signed up to the vow that we will deliver change for Scotland. This is not and never has been in doubt.
The vow makes four key promises—promises that it is imperative that we uphold. Extensive new powers will be granted to the Scottish Parliament. The people of Scotland will be central to any decisions moving forwards. All four nations should be resourced fairly, and we will continue the Barnett allocation for resources. I want to restate Labour’s categorical assurance that in our first Queen’s speech we will have a new Scotland Act. We look forward to the report from Lord Smith of Kelvin, which I understand is expected next Thursday.
The result of the Scottish referendum will change our Union for the better. The Opposition are completely clear that we will keep our vow, made to the Scottish people on the eve of referendum. It is also clear that we now have a great opportunity to change the governance arrangements in the rest of the UK for the better, and it is that to which I now turn. It is right that we do not just consider further powers to Scotland in isolation from a wider crisis of trust that we are seeing in our politics across all four nations, and it was widely alluded to in many of today’s speeches. There are a number of reasons for this breakdown. The age of deference is long gone, thank goodness, but it is not welcome that it has been replaced by the age of contempt. All institutions have been affected by this breakdown in trust: Parliament, the Church, the police, the press—I could go on. We need to address that.
Globalisation has increased the feeling of powerlessness, and the view that supranational forces are more influential than national Governments makes it hard to persuade potential voters of the possibility of change at national level. The commercialised retail model of politics as a brand choice, rather than a contest of values, encourages passive consumer behaviour, rather than empowering potential voters to become actively involved. The way politics is carried on in Westminster is becoming increasingly incomprehensible to an electorate who are alienated, rather than charmed, by our arcane and quaint procedures.
It is clear that we need a radical plan for reform and change. That is why Labour has built on our proud tradition of constitutional reform, and has announced a comprehensive programme for change. We will deliver a new English deal, which will devolve over £30 billion to city and county regions. We will ensure that the Welsh model of devolution is on an equal footing with the Scottish, and will hold an unprecedented and wide-reaching constitutional convention, in order to have a conversation with all parts of our country about the change that we need if we are to modernise the way that we are governed. We will introduce regional investment banks; devolve powers to encourage economic development in cities, counties and regions; and ensure that skills, transport and the Work programme can be planned and delivered locally.
We are already doing some pre-work, before the election. We want this to happen very quickly after the election, and want to be ready to come forward with some views after proper conversations with people from across the entire country. We are looking at models such as the Scottish constitutional convention and the Irish constitutional convention, which happened after the crash. There are good models out there that we can use to bring about a process that would give a new settlement the legitimacy it deserves. [Interruption.]
I will get on with that later, Mr Deputy Speaker.
Our amendment, had it been selected, would have brought about proposals that would meet the scale of the challenge and unite the country through conversation and consensus; that is exactly what we would seek to do.
When the Prime Minister appeared on his front step just hours after the result of the Scottish referendum was announced, his intention was not to bring our country together, but to try to find a new way to divide us with his partisan suggestion of English votes for English laws, which he appears to want to apply to Finance Bills. Instead of behaving like a Prime Minister, he behaved like a man concerned only with his own narrow party interest who was running scared of the UK Independence party.
The need for a distinct voice and identity for the English is something that I understand, but the issue is much wider than who votes on what, and in which way, in this House; today’s debate has demonstrated that. Look at what this Government have done to make worse the problem of unfair access to resources. They have instigated huge cuts to local authorities in England, and they have hit the poorest areas hardest.
The effect of the Barnett formula distribution pales into insignificance compared with what has been happening in local government allocations. My local authority will have suffered a 57% cut to its 2009-10 budget by the end of this Parliament, which is a loss of over £700 per household. While the social safety net is torn away in the Wirral, Surrey Heath has received an increase of £25 per household. With their modest announcements on some cities, the Government have come very late to any thought of meaningful devolution of power to the English regions. Indeed, they have centralised power quite significantly, beginning with the complete dismantling of the regional development agencies.
Meanwhile, Labour Members have been proposing the biggest devolution of power ever to the English regions. After the McKay commission reported on the West Lothian question, the Government’s own press release said:
“The Government is giving serious consideration to this report. Given the significance of the recommendations for both England and the UK as a whole, it is right to take the time required for a thorough and rigorous assessment.”
That welcome and sensible approach was thrown over on the morning after the referendum. I hope that we can see it reasserted in the months ahead.
Labour has a proud record of constitutional reform achieved by trying to find cross-party consensus. We devolved power to cities as well as nations. We passed the Freedom of Information Act and the Human Rights Act. We began the process of Lords reforms, and I hope that we will be able to finish it by establishing a senate of the nations and regions. We understand that there is more to the debate than just English votes for English MPs; it is about how our democracy works and how we can rebuild trust in it.
I urge Members to vote against the motion because of its reference to a review of the Barnett formula, which would go against the promises that were given to the Scottish people before the referendum. There is an exciting possibility of progressive change ahead and the prospect of a radical improvement in the way the UK is governed, which would take power and accountability closer to the people and renew our democracy. I believe that we should seize it.
It has indeed been an interesting, lively and, in the main, good-tempered debate, with one or two reminders from the hon. Member for Birmingham, Edgbaston (Ms Stuart) to other Members to be good tempered and well informed, which seemed to be successful. Many hon. Members, including the shadow Leader of the House, referred to the sense of alienation and powerlessness that many voters and observers of politics feel, and I think that is true. It is very important that we grasp that and respond to it. It will be important in the months ahead to have further detailed and substantial debates in the House about these matters.
I will try in the short time available to respond to as many of the points that have been made as I can, leaving a few moments for my hon. Friend the Member for Esher and Walton (Mr Raab) to respond to the debate, which I congratulate him on launching, with the support of the right hon. Member for Birkenhead (Mr Field).
I disagreed with much of what the hon. Member for Birmingham, Hall Green (Mr Godsiff) said, but he did call for a smaller House of Commons. I hope that the next time that comes up for debate, all parties will vote in favour of the proposals, as some of them failed to do so in the course of this Parliament. My hon. Friend the Member for St Albans (Mrs Main) said that a logical conclusion of what is happening in Scotland and Wales is that a democratic deficit in England has to be addressed. I think that is absolutely true, and I will move on to what should be done about it in a moment.
The right hon. Member for Knowsley (Mr Howarth) spoke convincingly and constructively about how cities and counties have sometimes underperformed and how they can take on greater responsibilities. Just before this debate I met many of the leaders of the core cities, including representatives from Liverpool, to discuss, building on what has now been agreed with the Manchester authorities, how we can imaginatively pursue greater decentralisation, with greater accountability among the cities, city regions and regions that include rural areas, because this is not just about metropolitan Britain.
I believe that there is an opportunity for an exciting cross-party agenda on that. We might differ from one party to another on the pace or detail, but the time has come for a general recognition in this country, and in all parts of the United Kingdom, including Scotland, Wales and Northern Ireland, that decentralisation towards local government is the way forward. That has not been pursued by the Scottish Government, and I hope that they will do so, just as we are doing in England.
My hon. Friend the Member for Argyll and Bute (Mr Reid) stressed the importance of honouring the timetable of commitments to Scotland. It is important to stress that the timetable is being honoured. The Government published the Command Paper on further devolution to Scotland ahead of schedule, setting out the proposals from each party. Lord Smith of Kelvin is overseeing a cross-party process to produce an agreed set of proposals by the end of this month—in the next 10 days. Based on those proposals, the Government will publish draft clauses by 25 January so that the legislation is ready to be implemented after the next general election.
The hon. Member for Moray (Angus Robertson), who spoke for the SNP, remarked on the election of the First Minister; indeed, I congratulate her and wish her well. He said that change in Scotland should not be dependent on dealing with the West Lothian question. It is not dependent on that; it is an unconditional commitment by all three of the United Kingdom parties. I know that the SNP is almost longing for it not to be an unconditional commitment, but it is.
Can the right hon. Gentleman clear this up once and for all? The hon. Member for Aldershot (Sir Gerald Howarth) said that the vow is not worth the paper it was written on because it was not agreed by Parliament. What is the right hon. Gentleman’s message to his Back Benchers? Is it that the vow is something that is promised and guaranteed or that, as the hon. Member for Aldershot says, it is not worth the paper it is written on?
I will defend my hon. Friend, to save time. To be fair to him, he said that the SNP had called the vow a gimmick and now treat it as being of huge importance, which it is. [Interruption.] That was absolutely his argument.
The hon. Member for Moray said that he was speaking on behalf of 1.6 million people who voted yes. Actually, our duty in this House is to speak on behalf of, and consider the interests of, all 62 million people in the United Kingdom. When asked by Labour Members, he left some doubt as to whether the SNP will accept the outcome of the Smith commission. The rest of us made compromises on the basis that we will support the outcome of Smith.
My hon. Friend the Member for Cardiff North (Jonathan Evans), who has had to leave, made the powerful point that in 1997, when he and I opposed devolution in Wales and it was carried by a very small majority, we accepted the result of the referendum and did everything possible to make the Welsh Assembly work in the interests of the people of Wales and to support the success of devolution in Wales. Nationalists seem to have an asymmetrical view of democracy, whereby if there is a referendum that confirms their view, it is for ever, and if there is a referendum that differs with their view, it is only a temporary thing before going on to the next one. It is time for a symmetrical view of democracy as well as more symmetrical democracy within the United Kingdom.
That brings me to the point made by my hon. Friend the Member for Salisbury (John Glen), who said that he was against an English parliament. I agree with that, and I agree with those who have said—
I will not give way again because I have only a few minutes before I must let my hon. Friend the Member for Esher and Walton speak.
I agree with those who have opposed a federal system for the United Kingdom, because the United Kingdom does not lend itself to a federal structure. Therefore, we have to find our own answer to what we have always called the West Lothian question. This debate goes wider than votes in this House, as the shadow Leader of the House said, but it does include votes in this House. That is something that we have to address, and in the coming months, we must make specific proposals to do so.
Various commissions have worked on the issue over recent years. There was the Norton commission that I established within the Conservative party. There was the democracy taskforce of my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke). There was the McKay commission, which set out the important principle, to which the Prime Minister referred at the Liaison Committee this morning, that
“decisions at the United Kingdom level with a separate and distinct effect for England (or for England-and-Wales) should normally be taken only with the consent of a majority of MPs for constituencies in England (or England-and-Wales).”
Although there are many different ways of implementing that principle, it will be important to do so. Refusing to face up to that would be the true “insider fix”, because the great majority of the people of the United Kingdom expect some such principle to be implemented and adopted.
The hon. Member for Nottingham North (Mr Allen) said that it was time for England to come to the devolution party. I agree, although I think he was unkind to the Prime Minister in saying that there was a lack of urgency. There is a great sense of urgency in the Government in taking forward decentralisation to cities and other localities, and in addressing the West Lothian question as well.
My hon. Friend the Member for Aldershot proposed the idea of reducing the number of MPs from Scotland and Wales. I do not agree with that opinion. It is important to address the issue in other ways, and I do not think that they should be reduced below their proportionate representation in the House.
I will not have time to go through all the hon. Members who have spoken. The hon. Member for Dudley North (Ian Austin), who is not in his place, made the case for a Minister for the west midlands, largely on the basis that he would be the Minister for the west midlands. I think we have now moved past that idea to address the issue in new ways. The hon. Member for Newport West (Paul Flynn) made the case for the importance of languages. He can be assured that the Welsh language lives very strongly in the family I have married into, and I am extremely conscious of that.
If I may finish on the question of Wales, it is important for Wales to play its full part in the greater decentralisation and devolution. The Secretary of State for Wales has made it clear that he wants to hear views from across the political spectrum in Wales on the best way forward. He has begun discussions with the leaders of the Welsh parties with a view to building consensus.
These issues now have to be addressed and resolved in a way that is fair to the whole of the United Kingdom. We are absolutely committed to the timetable for Scotland and we are committed to further powers for Wales and on the special needs of Northern Ireland, but we cannot ignore the needs and the rights of England. Being fair to all is now our mission.
It is a pleasure to follow the Leader of the House’s rousing summation. I certainly agreed with all the gusto and spirit of his peroration. As we move forward, it is very important that the views expressed in this debate are adequately reflected in the proposals that all the parties make.
I again thank the Backbench Business Committee and all its members for allowing this debate to take place. It is very important that all voices and all parts of the United Kingdom are adequately reflected in such debates. Rightly or wrongly, there is a sense that parts of the Union may have been shut out of the debate, because we did not want to prejudice or interfere in the referendum campaign or to allow points made during it to be twisted or manipulated. Following the referendum, it is therefore important to broaden the debate and open it up to all parts of the United Kingdom—to England, as the Leader of the House said very powerfully, but also to Scotland, Wales, Northern Ireland and to all the constituent parts of the nations. I want briefly to refer to the many great speeches that hon. Members have made.
I congratulate the hon. Gentleman on bringing forward this debate. The issue at stake is getting fairness right throughout the regions. It is not just about Scotland, Wales, Northern Ireland or, indeed, London, which, as everybody seems to forget, already has an assembly; at the end of the day, we are looking to get to a position where everything is seen to be transparent and fair for all parts of the country.