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Scotland: Devolution

Volume 491: debated on Wednesday 13 January 1988

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3.16 p.m.

rose to call attention to the case for devolved government in Scotland; and to move for Papers.

The noble Lord said: My Lords, having raised the issue of Scottish devolution in this short debate I am greatly encouraged by the number of noble Lords who have indicated an intention to speak. As there has been certain criticism that the debating time is too short, perhaps I may say that in my limited experience of your Lordships' House Scottish matters have not previously attracted such all-embracing attention. I regret that the noble Earl, Lord Perth, who wished to speak in this debate in favour of the principle of devolution, is unfortunately unable to be present.

It is clear that there are those who believe that devolution for Scotland would be a fatal step towards the breaking up of the United Kingdom. There are others like myself, who are convinced that a denial of devolution would be the short road to separation. Whichever side is correct, there can be no doubt whatever that the demand for devolution of democratic power to Scotland, including tax-raising power, has grown very much stronger over the last 10 years.

The noble Lord, Lord Home of the Hirsel, in 1978 advised Scots to vote against the then legislation because of the absence of tax-raising powers in the Scotland Act. There is general acceptance now that those powers are necessary. It is clear that such devolution with tax-raising power commands the support of over three-quarters of the Scots. This is clear both from election results and from public opinion polls.

I do not consider that it would be useful in this debate to discuss the detail of devolution proposals but to consider why there is such a strong and, I believe, increasing demand for devolution in Scotland. Part of the feeling is the North-South divide, which has widened and which this Government's policies appear to do nothing to diminish. This affects Wales and the North of England as well as Scotland. We in Scotland recognise and sympathise with the frustration felt in the Principality, and in the outlying regions of England. We recognise that we share similar problems. Scotland is, however, also different.

It is a nation brought into the United Kingdom by the Act of Union nearly 300 years ago. It has a separate, established Church, and, as the present Secretary of State for Scotland has said on several occasions, it is the only nation with a separate legal system but no separate legislature. In the volume of the Stair Memorial Encyclopaedia of the Law of Scotland published last year, the noble and learned Lord, Lord Fraser of Tullybelton, drew a contrast between the increased respect shown for a separate Scots identity in matters of the machinery of government and;

"the evident fact that real political and economic power was seeping away from Scotland to London. The public in Scotland were conscious of that fact and unable to alter it".

That is what the noble and learned Lord wrote. That was published last year.

The people of Scotland are clearly determined to alter that fact, and this must be recognised. Why is there that strength of feeling when there has been so much administrative devolution? The Scottish Office is responsible for almost everything that happens in Scotland, apart from defence, Treasury matters, social security and foreign affairs. The trouble is that ignoring the wishes of the Scots when they have an opportunity of expressing them is a form of dictatorship. As we discussed on Monday, local authorities have their powers confined and restricted. Consultation papers are published and the views expressed are ignored on the principle, apparently, that "Nanny knows best".

There is a considerable difficulty in talking of democracy in a country where only 10 of the 72 elected Members support the Government. The Government force their views through by the votes of southern English Members who do not even appear to listen to the arguments being produced. It does not impress the Scots that there have been occasions when a United Kingdom Government have not had a majority of English seats. The reason this does not impress the Scots is that there could not be a United Kingdom Government with only 15 per cent. of the English seats supporting that government. That is the position in Scotland.

One of the results of the arrangements in another place is that if an English or a Welsh Member wishes to ask Questions on, let us say, health, housing or education, he has three occasions to question the three departments, or to try to do so. A Scot has one Minister, the Secretary of State (to whom he can direct all these questions) and only one occasion every four weeks on which he can do it.

On legislation in another place it clearly does not matter what the Scots may say, the Government will have their will. It is not surprising that this is regarded as unsatisfactory. In this situation your Lordships' House would have an opportunity to fulfil its revising function to the full. I regret to have to suggest that on Scots matters this is not done because the Scots do not appear to have adequate representation. We have in this House an adequate number of Scottish landowners. We probably also have an adequate number of Scots advocates, but is Scots life in its full width represented as well as the English or the Welsh? On local government many of your Lordships have recent or ongoing experience in local government south of the border. How many Scots with recent experience of local government in Scotland are there in this House? On education, we have many who speak with authority on English and Welsh education. Where are the Scots in this House who can speak with authority on the separate Scottish education system? There are not very many. Scotland has nine out of the 45 universities. They are not all very recent universities. The university that I had the honour of attending is not the oldest Scottish university, but it had its 500th anniversary before I got there.

In this House we have had many fascinating debates on the difficulties of what is apparently called tertiary education. Chancellors, principals and other professors and teachers from the universities give very useful contributions from all sorts of universities south of the border. They speak with great authority; but the silence from the Scottish universities is deafening because there does not appear to be any Member of your Lordships' House who can or does speak for Scottish universities. The same could be said of medicine, where Scotland has a certain reputation; and the same could be said of the arts and the Church.

The Scottish financial community is a large and efficient business employing over 85,000 people. The noble Lord, Lord Polwarth, stands out as the representative of that community. Sometimes I took part in the financial services debates in the past year. These debates showed that the number from your Lordships' House who work in the City of London was sometimes quite overwhelming; but there seems to be a lack of balance. Scotland was an industrial nation. The closure of modern profitable plants such as the Caterpillar plant causes considerable worries about the branch factory syndrome. There is considerable fury at the apparent intention to close the Ravenscraig steelworks. But where in this House are the Scottish industrialists? Where are the Scottish trade unionists? They are not very noticeable.

It is also perhaps noticeable that from my party (which has 50 of the 72 seats in another place from Scotland) there are only two of us able to speak in this debate who are home-based Scots.

It is for those types of reasons that the Scots see Westminster as inadequate to represent their interests and this inadequacy is damaging to a true democracy. The case for a proper meaningful devolution is clear. I am reminded of the story of an exasperated mother who said to her son, "You'll be sorry when I'm gone", only to receive the comment from her younger daughter, "But I won't, Mummy, will I?" If the Mother of Parliaments is wise it will heed the distrust of the Scots. I beg to move for Papers.

3.27 p.m.

My Lords, I am sure that the noble Lord, Lord Morton of Shuna, will recognise that when the speaking ration is five minutes, the usual compliments have to go by the board. But I can, I hope, within reason convince him because all my life I have been a supporter of decentralisation in government and in administration. That has always been a part of my political philosophy: an instinct which was very much reinforced during the 50 years or so when it seemed that his party might be successful in installing in this country the nationalisation of the means of production, distribution and exchange. That would have involved a concentration of power totally unacceptable to England, Scotland or Wales, and happily the electorate has agreed.

By contrast, the Conservatives have always dealt in decentralisation, as the Secretary of State for Scotland, Ministers in the Scottish Office and the apparatus of St. Andrew's House in Edinburgh testifies. Those experiments have been a success. I should like to see them added to, for this reason. I would relate the discontent and frustration in Scotland much less to the subject of devolution, which the noble Lord has raised, than I would to the endless time which it takes to deal with officialdom, whether that officialdom is centred in Whitehall or St. Andrew's House. The people of Scotland need speedier administration and a speedier solution to everyday subjects. I hope we shall get the reassurance from the Minister of State that that is in mind.

It so happens that in the early 1970s I had to preside over a committee which explored in depth this question of a legislative element in the devolution picture. The one principle on which we were all unanimous was that any proposal must sustain the unity of the Westminster Parliament. That is the standard by which we should judge. In that context, I must tell your Lordships that there was only one proposition which the majority of us felt we could endorse, and that was the possibility of a Scottish convention which would take the Second Reading and the Committee stage (the main stages of the Bills) in Scotland, which would then finish their business in the Westminster Parliament. It was said to be rather a clumsy device, and two distinguished academic members of the committee dissented on the grounds that such proposals would create more difficulties than they would remove. I think that the question before your Lordships today is whether in the past 15 years or so anything has happened to sway the argument decisively one way or the other.

The recent experience of the United States, where government was nearly paralysed because the constitution provided for the possibility of divided councils in the executives, is one that I think Parliament should notice. There would be a danger in certain devolution proposals of a split between the Westminster Parliament and the Scottish convention or assembly.

Secondly, there is the fact that we have still been unable in this country, although there are special circumstances here, to organise a satisfactory subordinate legislature for Northern Ireland.

Lastly, in recent years there is the fact that some elected and powerful local authorities have fallen down on their responsibilities, particularly in relation to finance. I think we have to take account of these things. I do not think that these constitutional matters are subjects for short debate; but when facing up to constitutional change it must rest, if it is to come, on a reasonable consensus. I do not find that consensus either in England or in Scotland. I do not know about Wales. I am not sure that a consensus is there.

Therefore, although it sounds rather unadventurous, for the time being I would like to rest on improvement in the administration, which I think is still possible, in order to get quicker decisions from officialdom in Whitehall or St. Andrew's House. A Scottish convention could bring the debate nearer home in Scotland. But we have already established a system which it would be possible to work, and that is to ask the Scottish Grand Committee to sit more often in Scotland, debating the main clauses of Scottish Bills there. That might be a possibility and I think it is one to which we should give very much closer consideration than we have already done.

3.34 p.m.

My Lords, I shall try to put to the House some of the feeling in Scotland, and the consensus which I believe there is in Scotland, in the short time that is available. The desire for a Scottish Parliament started with the regret which lasted for many years over the union of Parliament in 1707, mainly I suppose from the Scottish Peers who were not bribed at the time. The Liberal Party has a long history of wishing to have not Scottish devolution or administrative competence but a Scottish Parliament responsible for the affairs of the Scottish people within the framework of the United Kingdom. That is what we shall look for. That is what we want. The Liberal Government of 1913 passed a Bill through its Second Reading but of course the essential thing was Irish home rule and then we had the war.

I do think that when we look at the efforts which have been made over the past 20 or 30 years and the enormous surge of feeling in Scotland, then the House must recognise that this is something real and not some vague Celtic tremor North of the border. It is very real and it is a thing that has to be taken note of. For far too long the road for success in Scotland has been furth of Scotland, either in England or in the colonies. The British Empire was largely made I suppose by Scots to a very great extent, who could find no outlet for their energies at home and who felt that at home there was no outlet and therefore the energy they did possess only came to its full fruition when they went abroad. I think that is true today.

What we want to see in a Scottish Parliament is a power centre in Edinburgh in the central belt—call it what you will—which will attract and hold people at the centre of power because able people always want to be near the centre and not to be part of a secondary body. No amount of good administration will make any difference to this. A parliament in Edinburgh would promote much more than competent administration and good legislation; it would also promote a flowering of the arts and of all forms of the energy that the Scottish people possess in such large measures.

I was astonished that the noble Lord, Lord Home, should quote Northern Ireland. The reason that Northern Ireland was so tragic was of course that it was not a proper unit; it was split in two. Political power was never given to the minority. But Scotland is a different unit altogether, and technically Stormont was a very, very competent parliament. They knew what they were doing. In my own sphere of agriculture, I could see that this small integrated unit was way ahead of what we were doing in Scotland at the time. Technically there is no question in my mind but that the Stormont Parliament was extremely good. They did quite well in the technical sphere.

The other point which I must make is that I have been a party manager in Scotland, and trying to get people to stand for Parliament is extraordinarily difficult if they are able people pursuing their own careers. Time and again people have said to me that they would stand if we had a parliament in Scotland. I intend no disrespect to the people who came here, but it is very noticeable that in Northern Ireland the best people stood for the Stormont Parliament, and that is what we would get if we had a Scottish Parliament. One would have good people entering the Parliament; one would have the best. I dare say that that would be to the detriment of Westminster. But it would certainly be for the good of Scotland.

Without doubt, the Labour Party's last effort failed because it lacked a proper representative system; in other words, proportional representation. People were frightened to death by the thought that they would come under the rule of a group of Labour Party politicians in the central belt. I know of many good Liberals who voted against the issue for that reason alone. If we are to have a Bill it must contain PR. If that is included, and if the people of Scotland are properly represented, it will benefit the people of Scotland and the United Kingdom.

3.41 p.m.

My Lords, the various proposals of opposition parties for further devolution in Scotland are, I believe, ill-conceived and would be immensely damaging to Scotland, and indeed to the United Kingdom, in the longer run. We already have a considerable amount of decentralisation and devolved government.

The suggestion that Scotland would benefit from an elected Scottish Assembly with tax-raising powers, as set out in Labour's Scotland Bill, is, I believe, dangerous and would almost certainly lead to the eventual break-up of the United Kingdom. More immediately, I believe that it would lead to a crisis in the Scottish economy.

Just as the Act of Union, and the markets it brought, were vital for the growth of the Scottish economy during the 19th century, so too they are vital for Scotland to overcome the problems of today. These problems are reducing; with unemployment falling rapidly, inflation under control and productivity rising.

The political stability and markets brought by the union have provided the basis for very many jobs in Scotland. In recent years, through "Locate in Scotland", we have been uniquely successful in attracting inward investment. There are already indications that this would reduce and cease if there were a real prospect of an assembly with tax-raising powers which so many believe would eventually lead to separation.

There is no use Labour saying that tax rates would be lower in Scotland. Labour has consistently opposed the Government's programme of income tax reductions. Any increase would be unattractive not only to those considering setting up new businesses in Scotland but also to potential inward investors. It would also be highly unpopular with Scottish businesses already established. Higher rates of tax would be likely to lead to higher wage demands and that would also act as a constraint on the creation of new jobs.

When devolution was last an issue in the late 1970s, the then president of the Glasgow Chamber of Commerce wrote in the chamber journal:
"There is no doubt in the minds of the Directors of the Chambers that business will he damaged: first because prospects for future investment in this area, whether inward or indigenous, will be diminished. Many people would be fearful to bring new capital into the area because they think it may end up part of a small nation on the periphery of the great European Community. And it cannot be emphasised too often that, despite all the efforts of Government and Industry and Trade Union alike, for historical and geographical as much as for any other reasons, the battle to bring investment here is always bound to be more difficult than it is elsewhere. Who needs more difficulties such as uncertainty will bring?"
Those words, written in 1977, are as true today as they were then.

We must ask ourselves the following questions. Would an assembly improve or diminish our trading prospects? Would an assembly create more productive jobs? Would an assembly help businesses to make a maximum contribution to the welfare of our society? At best the answer can be that for some businesses it will have no effect; for others it will diminish them. Certainly I do not believe that it can improve them. It will breed a new bureaucracy, another tier of government in Scotland and more taxation when the people who create jobs in Scotland want less government and less taxation. The CBI and the chambers of commerce share those views, as do the leaders of the financial community.

Towards the end of last year the Scottish Conservative Party decided to check its beliefs by asking individual companies in Scotland what they thought. I should like to emphasise that companies who took part in the survey were selected entirely at random. Although Labour spokesmen have endeavoured to cast doubt on the survey and its answers, they have produced no evidence of support for their proposals from the job creators, commerce and industry. This was the most comprehensive survey of business ever undertaken by the Scottish Conservative Party. Believing that the Scottish business community cannot afford to ignore the devolution issue, Labour's arguments were put to the test of those who actually create the jobs and wealth in Scotland.

A cross-section of Scottish companies, numbering 1,688 in every constituency in Scotland—from large employers to one-man businesses—was surveyed during the first three weeks of November. Of those surveyed, 31.2 per cent. responded, a considerably higher figure than is usual in this type of survey. Excluding the "don't knows" and "no opinion expressed", no less than 97.2 per cent. of Scottish businesses stated that they would not invest more in Scotland while 89.7 per cent. stated that they would invest less. Perhaps most worrying of all, 84.3 per cent. stated that they would review their Scottish operations.

Most of the companies believed that their business opportunities would be met not by a Scottish Assembly but by lower interest rates, lower taxation, stable exchange rates and business rating reform. That is what this Government are giving to them. The possibility of a tax-raising assembly would have a most damaging effect on investment plans and jobs in Scotland, with a likely exodus of Scottish employers. I trust that today the House will show its distaste for proposals for devolved government in Scotland.

3.47 p.m.

My Lords, before embarking upon what I wish to say, I should like to set the record straight. I understood the noble Lord, Lord Morton of Shuna, to say that of all the speakers today only two were Scottish based. I hope that the noble Lord will correct me if I am wrong.

I am sorry. I did not make myself clear. I said that only two speakers are members of the party of which I am a member and which has 50 of the 72 seats in Parliament.

Thank you. There is nothing new about Scottish nationalism. In 1713, only six years after the union, a Bill to repeal the treaty failed by a whisker to pass through this House. The 1715 and the 1745 rebellions were as much manifestations of discontent with the British Government as of romantic loyalty to the House of Stuart. But the cruelty with which the 1745 rebellion was suppressed, and the repression which followed, served in retrospect to lend enchantment to a vision which, had it become reality, would in all probability have led to strife and disillusion.

The Scottish National Party are really modern Jacobites, chasing a chimera and a romantic illusion. They are always with us, and the support they command waxes and wanes as the prosperity of the United Kingdom waxes and wanes.

I should like to compare the union to a marriage of convenience between a rather arrogant and sometimes rather cruel man, possessed of large and rich estates, and a neighbouring lady, with a beautiful but impoverished estate, of great pride and a slightly prickly temperament. To start with, it is not a very happy marriage. She tries to run away; she comes back; she has affairs with other men; and sometimes he beats her. But eventually they settle down together, raise a family, make friendships and vanquish opponents. Their estates are under the same management, their finances and business interests become inextricably intertwined. They present a united face to the outside world. Yet, from time to time the wife still toys with the idea of a separation.

I hope that common sense will prevail and that she will realise that she does not have much experience of standing on her own feet and will certainly be worse off without her rich husband's support. I hope that she recognises too that most separations lead sooner or later to divorce, and that the task of trying to unscramble their finances and interests after so long will be too daunting and painful and productive of strife to themselves, their families and dependants to be contemplated. However, I hope that he will try to be more tactful and understanding to her than sometimes he has been in the past and will make a greater effort to make the marriage work.

I believe that any form of devolved government for Scotland will inevitably lead to the ultimate break-up of the United Kingdom. That is the declared aim of the Scottish National Party and I believe that that break-up would be disadvantageous to England, but to Scotland it would be disastrous.

3.50 p.m.

My Lords, I am going to do something in this House I have never done before. Do not be alarmed. I know this sounds conceited—and I am not at all conceited—but I should like to quote what I said in the Second Reading debate on the Scotland Bill on 14th March 10 years ago. Mr. Callaghan, now Lord Callaghan, was then Prime Minister and we had a big debate on devolution, as all your Lordships know. I said:

"When we review the historic benefits of the Union—the most perfect alliance of all time—it is a Union, after all, that has spawned the most successful political communities the world has ever seen. It has spread our laws, language, customs and religions half-way round the globe. In addition, the Union saw the beginning of the most glorious chapter of Britain—that is, a chapter in which Scotland played a most glorious part, and indeed a greater part that her small population warranted."
I feel the same today, I am afraid: that is not the point of view of the Opposition. I fully support my noble friend Lord Home. It would be absurd for me to say anything with which he did not agree.

Regarding the Scottish Grand Committee, I should have thought that now we are in the electronic age it would be more satisfactory to Scotland if it always met in Scotland and if the Grand Committee was based there. Surely in this electronic age the Members in Westminster, though sitting in Edinburgh one or two days a month could vote electronically and could also see the debates in Westminster on television, if they had time to leave the Chamber of the Scottish Grand Committee.

However, what I cannot understand is that Scotland has its cake and eats it. As we have heard today, Scotland has its own legal system. It has its own religion, regional councils, county councils, and community councils. Scotland even has its own language. Of course, it is unfortunate that, as I understand it, there are only 70,000 registered Gaelic speakers. I can say a few words because I had a Gaelic nurse at one time. However, it seems that Scots have their cake and eat it because every Scotsman per capita has a greater slice of the Westminster Treasury than does the Englishman or the Welshman. Also, we have Parliament in Westminster and we have the European Parliament. If we have too many of these organisations we are going to be over-governed.

What worries me concerns business and industry. As we have heard from the noble Lord behind me, in those days 10 years ago the Scottish Chamber of Commerce said that in its opinion devolution would be very unfavourable to Scotland. It would affect Scottish industry extremely badly. After all, it has been integrated for so many hundreds of years—nearly 300 years—and industry is as much Scottish as English. I cannot understand the desire of the SNP to have an independent Scotland. I can only imagine that the SNP wants personal power, which will only end in a talking shop. I personally believe that that would be very detrimental to Scotland.

3.55 p.m.

I do not feel that it should be only Scots who speak in this debate, because I believe that the question of devolution for Scotland is a matter which affects the whole of the United Kingdom and the implications should be carefully thought about.

I had some experience of trying to steer the devolution legislation through the other place. When I became Chief Whip for my party and government in 1976, I inherited the Scotland and Wales Bill, which I very quickly realised maximised the opposition and, as the House will know, we moved a time-table or guillotine Motion—one of those coarse procedural methods which are used in the other place—and we failed. Therefore, we had to return to the subject the following year, when I managed, with others, to persuade my colleagues to split the Bills so that we had a Scotland Bill and a Wales Bill, which made the situation more manageable.

Although it was a government measure, the support for it and the opposition to it was cross-party, because we always had substantial support from the Scottish National Party. The Welsh Nationalists and a number of Conservatives also were consistent in their support for Scottish devolution, and much the same was true for Wales. However, the principal problem that I had to deal with was in my own party. This opposition came particularly from Labour Members of Parliament who represented regions of the country where economic conditions and unemployment were bad. In particular, noble Lords will recall a great deal of opposition from the North-East of England—from Tyneside, from Wearside, and the coalfields there. These areas which suffered economically were extremely worried that any advantages for Scotland would mean disadvantage for them. To me, this was one of the sad things about the attempt to legislate, because economic adversity turns one region against another. They are competing for resources and that is divisive in what should be a united kingdom.

One of the reasons why I opposed the entry of our country into the EC was because I felt it would shift the centre of gravity towards the South and the South-East. I believe that that has happened. I believe too that the problem will be exacerbated with the construction of the Channel Tunnel. We must try to understand the frustrations which are experienced by the Scots and others; that is, those feelings of frustration that they are being pushed more and more to the periphery of activity. Therefore, we should consider very seriously indeed whether or not they ought to have this devolution of powers.

I shall not go as far as some people in saying that the whole issue is ablaze, but there is very deep feeling in Scotland. It was not quite as strong in Wales. During the passage of the legislation I was on holiday in North Wales and I did my own little straw poll of people I met in the course of the day, on the bus and so on. On one occasion I was in the butcher's shop ordering some meat and sausages and I asked, "What about devolution?" The butcher replied, "We don't stock it". It was not absolutely and universally acceptable.

Unfortunately, the imbalance to which I have referred is reflected in the political situation. I fear that unless something is done it may lead to political instability and a loss of faith in our parliamentary and democratic situation. If we are to satisfy this need for devolution we must have some form of devolved representation; otherwise, the genuine grievances of very many Scottish people may be exploited by minority interests for their own ends.

4 p.m.

My Lords, I am personally delighted that the noble Lord, Lord Morton of Shuna, has introduced this debate and given us all the best arguments. I have absolutely no doubt that he has advanced all the arguments that could possibly be thought of. I was full of admiration listening to him.

This concept is hopelessly out of date. The debate might well be taking place in 1707 or 1708. As a matter of fact I believe my forebear opposed union at that time. But never mind about that! I do not know of anyone who has written the story of Britain as such, but we can say that after 300 years or more a smaller country agreed willingly to a union with a bigger and stronger country and gave that country its monarch to carry on with. That was the basis of it.

It is true that in many ways England took advantage of the situation in a manner which I think has caused some of the emotion being experienced at the present time. I can quote Disraeli speaking of the empire of England. I can remember a time when the Post Office put "North Britain" instead of "Scotland". Those are little elements of an unemotional character, but they are still a sign.

I wish to draw attention to the immense importance Trevelyan, in his History of England, places on the Union. It was of immense benefit to both countries. Scotland gained free trade with England and our territories overseas and England became associated with the best educated and the most actively-minded people in Europe. That is the opinion of one of our finest historians. It is utter folly to suggest that this should be chucked away simply to have two assemblies, one in Edinburgh and one in London, shouting at each other.

We live in an age when, very shortly, there are going to be great changes. I shall provide one simple example. The traffic in London is absolutely intolerable. People will be forced out of London to go and live somewhere else. If Scotland is separated people will go no further than the north of England; if Scotland is open, then people will go there. This will be a far-reaching event.

Secondly, we have an enormous range of all sorts of institutions. Why go to the Stock Exchange when the whole operation can be seen perfectly well in Princes Street or anywhere else? This will break up the concentration of the money markets which has existed for some time. I believe it to be a great opportunity. Far worse than that to my mind—and this is borne out by listening to the questions which we heard today—is the great problem of bringing nations into harmony together.

I wish to quote what Sir James Eberle, the director of Chatham House recently said:
"No longer can governments safely make decisions in any field without taking account of the international implications".
In discussing this matter, have we even thought of the far-reaching international implications? Is Scotland to have no contact, or is it to have its own diplomatic services instead of many Scotsmen going into the British diplomatic service and serving it well?

I believe the situation will arise where there are three levels of voting. It is difficult enough to have two. I believe that the local authorities should be one elected body. However, we have the districts and the regions, and now perhaps another authority in Edinburgh. I believe devolution is really most unfortunate. As far as I can see, it is almost entirely inspired for purely party political reasons. I say that with regret. I do not think that we should lend ourselves to that in any way.

I agree absolutely with what my noble friend Lord Home said. There may be advantages in examining closely the powers and, above all, the constitution of the Scottish Office. Are we getting the cream of young men which we are entitled to have in this very important office? I do not believe it is fair for the noble Lord, Lord Morton of Shuna, to say that there is a dictatorship there. I guess that it is far easier to talk to the Scottish Office than it is to the Department of the Environment. I have not tried to speak to either recently but I suspect that it is very much easier. It is a much more open body. I hope that this view will be maintained by the House.

4.6 p.m.

My Lords, it is some years ago since in another place I took part in the debates on devolution which have already been referred to by the noble Lord, Lord Cocks: the original Bill before us and then eventually the Bills proposing separate parliaments for Scotland and Wales. The noble Lord has recalled the opposition to them. I was part of it.

In the debate in which I took part I stated then, all those years ago, and I state it again now, that in my opinion this island is too small for federalist government, which depends for its success, wherever it is, on an equal balance between one government and another. I stated then that the island was too small for federalist government and that very firmly remains my opinion today.

I looked up my speech today and I stated at that time that the maintenance of a united kingdom is basically essential to the prosperity and general wellbeing of all those who live in Scotland, Wales and any other part of England.

That Second Reading debate was in December 1976 and it occurred at a time when there was an unhappy economic situation. It was at a time when public spending cuts were made. In fact in the middle of the debate a statement was made to that effect. There were spending cuts amounting to £2·5 billion and at the same time the Chancellor of the Labour Government of the day was obliged to borrow a further £4 billion from the International Monetary Fund.

I think it is a very appropriate moment for us to remember and to emphasise that our comparatively much healthier economy today is healthy not least because of the success of regional policies in all parts of the country, including Scotland. Scotland has particular problems and no one is in any doubt about that and never has been. But the North-East of England also has faced particular problems. The noble Lord, Lord Cocks, was kind enough to mention them.

Just south of the Scottish Border our regional problems have been very similar to those in Scotland. There is declining old industry, the need to replace it with new and the urgent need to retrain people to provide the new skills required; and of course Scotland and the North-East of England have a common geographical location. There is the enormous problem of the long haul for goods to more populated parts of the country.

The North-East of England and Scotland are adjacent. During the recent summer months my noble friend who is to wind up this debate was kind enough to entertain me at his very charming home in Scotland. He will correct me if I am wrong but I thought that I could see England from the windows of his home. The area which we could see from that lovely house was the scene of past Border warfare. I cannot help feeling that should there be a devolved parliament for Scotland there would be something like Border warfare again.

Since December 1976 Scotland and the North-East of England have benefited enormously from regional policies, which have steadily improved over the years. I would suggest at this moment that they continue to do so. Yesterday's Statement suggests to me there has been considerable refinement and improvement in the way that taxpayers' money is being directed towards Scotland, the North-East of England and elsewhere. Scotland does very well out of public expenditure; current spending is running at something like 15 per cent. more than equivalent levels in England and Wales.

My concern in the 1970s—and with the proposal before us today—was that a full parliamentary Assembly in Edinburgh, with a full Civil Service and a full press lobby behind it, would give Scotland a totally unfair advantage in terms of attraction of industry over the North-East of England and other regions of the country. The overwhelming majority of people in the country today want to see above all successful government, which they are getting, but this can continue only if the economic integrity of a united kingdom is maintained.

4.12 p.m.

My Lords, I know that many of my countrymen would regard the English as an overtalkative people, and many of my English friends would regard the Scots as a somewhat taciturn and dour race, so it is a kind of poetic justice that this afternoon our speeches are limited to a ration of five minutes.

As regards the debate so far, I thought that the noble Lord, Lord Morton of Shuna, in his otherwise stimulating and interesting presentation of his Motion to your Lordships, at the outset rather oversimplified the position when he asserted rashly that it was clear that three-quarters of the people of Scotland wanted devolution, by which he meant legislative devolution. I hope that what I say to your Lordships, as I consume my ration of time, will make it clear why I think that that is a misapprehension and an oversimplification of the problem as it presents itself today.

It is not surprising that of late there should have been a resurgence in the demand for devolution in Scotland. It is surprising that the demand is not more vociferous than it has so far been, with Tory MPs rather thin on the ground north of the border and senior Ministers coming up to lecture us, playing what, as reported, sounded to me rather like variations on the theme "Get on your bikes". It is not surprising that there has been a reaction to that sort of thing.

In so far as the demand for devolution has increased, the prime leaders of that demand are the activists of the Opposition parties in Scotland and an organisation calling itself the Campaign for Scottish Assembly. I make no complaint or criticism of that, but I would observe that these groupings so far as the party political activists go are perhaps not as representative of the nation as a whole as they once were. Secondly, there is little evidence that the public are responding with notable enthusiasm to their lead so far as concerns a Scottish Assembly. While public opinion shows a significant majority for devolution, only a minority regard it as a matter of prime political importance.

I am frankly sceptical about the feasibility of devising any scheme of legislative devolution to Scotland in isolation from which benefits in the shape of better government would accrue and which would not be damaging to the unity of the Kingdom. I very much agree with the approach of the noble Earl, Lord Selkirk, who has just spoken, but if anyone can succeed in devising such a scheme I shall support it. Those of us who opposed strenuously the Scotland Act 1979 did so because we judged that it did not measure up under either head, and much that has happened since then suggests that we were right.

I shall make only one further point on which I think the advocates of devolution are somewhat vulnerable. They appear to have learnt nothing from and forgotten everything about the Labour Government's experience with the Scotland Act. If by any chance we have another Labour Government presenting a measure comparable with that misbegotten Act of 1979 it is essential that there should be a referendum of the people before that matter is finalised. I found myself in opposition to the concept of a referendum when the 1979 Act was being pursued, but people proved themselves more sensible than the politicians when they rejected the Act in the referendum.

It is often asserted that there was a majority who voted for the Act in 1979. That is only part of the truth. The simple fact is that 67 per cent. of the people either voted against the Act or did not bother to vote at all, after a campaign in which it was repeatedly asserted by the supporters of the Act that an abstention was the same as a No vote. So much for that illustration of the clamour of the Scottish people for devolution!

4.18 p.m.

My Lords, I rise to support very strongly the speeches made by the noble Lord, Lord Goold, and the noble Lady, Lady Saltoun. I am very strongly opposed to Scotland being separated from England and Wales. We are a United Kingdom and we should remain a United Kingdom. I am sure we must adhere to that principle.

Scotland has provided several remarkable Prime Ministers in the United Kingdom Parliament, such as the noble Lord, Lord Home, who has been speaking here this afternoon, Harold Macmillan and Campbell-Bannerman. Mr. Asquith, although he was not a Scot, represented a Scottish constituency, for the many years that he was Prime Minister and a Member of the United Kingdom Parliament. We have given distinguished people to the United Kingdom Parliament, such as Lord Thurso, a distinguished Cabinet member in the Winston Churchill Cabinet, whose son will speak here today. We have today a remarkable Lord Chancellor who is a Scot. Scottish field marshals and other soldiers have fought in wars and made a great contribution.

So I think it is very important that Scotland and England be united, making their contribution together, because if you separate England and Scotland we shall be a small country. We have only about 5½ million people, and if we were separated our influence would be small. As part of the United Kingdom, our influence stretches all over the world.

Although at the present time, as the noble Lord, Lord Morton of Shuna, has pointed out, the Labour Party has a considerable majority in Scotland, I have been associated with politics in Scotland since about 1924 and all the years that my husband was in Parliament—which was 40 years—in Glasgow we used to split Glasgow representatives about 50:50; 50 per cent. Conservative and 50 per cent. Labour. These things change. I agree that it is disappointing for us that we did badly in the last election. That is not to say that we will do badly in the next election. It would be a great mistake to alter in any way or change our relationships within the United Kingdom.

The noble Lord, Lord Goold, has pointed out that a separate parliament would need increased taxation and would also add to various complications. If the Assembly had taxation in Scotland and also in the United Kingdom the odd thing would be that the United Kingdom would be raising money for Scotland but would not have any say in how it was spent, because that would be done by the Assembly. Secondly, I do not think that people would appreciate having to pay two sets of income tax, which they would have to do under these conditions.

Above all I want the influence of Scottish MPs and Ministers in Scotland to spread overseas. We have had links with Europe for many years going right back into history and to Mary Queen of Scots. We still have great influence in Europe provided we are part of the United Kingdom. Scotsmen and women have travelled all over the world in the past as well as today. We have provided in the past Scots Prime Ministers for Canada and Australia and leading statesmen in many Commonwealth countries. I do not want to see that changed. We all become absorbed by local things, but Scotland has great influence in the United Kingdom Parliament, in the Cabinet and in the world, and I want this to continue. To confine our activities to a Scottish parliament, or Scottish Assembly, would curtail all this, so I am opposed to the proposal being discussed today.

I think that the point made by the noble Lord, Lord Goold, about the enterprise and business side of Scottish life is extremely important. Obviously nobody will bring businesses to Scotland if they are going to be confined to a small area and not able to deal with the whole of the United Kingdom and also the EC.

Therefore, I think that all the arguments that have been put for independence fall down when it comes to the practical way in which we can all contribute. I have, as I think your Lordships know, spent many years—29 years—in local government in Scotland. I have also now been nearly 30 years in your Lordships' House. Scotland can make contributions, and the organisation as it stands today can be improved. We can do things faster, as the noble Lord, Lord Home, suggested, but in the meantime we must stick together. We must have one parliament and one general interest, and we in Scotland must contribute to it as we have in the past.

4.24 p.m.

My Lords, I thought it would be difficult to know what to say in so few minutes, but since I have heard the speeches which have been made today I have found it much easier, because so many points have been dealt with. There was one point that the noble and learned Lord, Lord Wilson of Langside, raised about the referendum of 1979. The way I analysed it was that 67 per cent. did not vote yes. I think that is one way of putting it.

The noble Baroness, Lady Elliot, who has just sat down, was talking about the population. I am always struck by the fact that the population of Scotland is less than that of Lancashire and also less than that of Yorkshire. Therefore, the speech made by the noble Lord, Lord Cocks, particularly impressed me when he pointed out that you have to look all round the problem, including the problem as it affects England and as England affects the problem.

Talking of that—and I am picking out things that have not been said—I feel that we suffer a little from inaccuracy by the BBC. Their broadcasters are awfully inclined to talk about England when they mean Britain. It might be wise if they circulated their people and said, "Now, do be careful. You don't need to annoy these Scotsmen by going on about England". I am prepared to go along about England a bit because it has to be remembered that at the time of John Knox and Marie de Guise it was the English fleet which kept France from reinforcing Marie de Guise. We owe such a lot to England that I welcomed the words of the noble Lord, Lord Cocks, and of my noble friend Lord Selkirk. The facts that they produced have a great bearing upon the current problem.

Scotland has been badly served by its press. The principal papers really are the Glasgow Herald and The Scotsman. The Glasgow Herald calls itself "Scotland's newspaper".The Scotsman calls itself "Scotland's national newspaper", and so they go on and on, and have been binding and binding about England until some of us are sick and tired of their columns of correspondence. I feel that the change in the editorship of The Scotsman may have a beneficial effect, if I am right in judging by the columns of correspondence in today's Scotsman, oddly enough. I feel that we cannot emphasise too much that broadcasters and the press ought to be circumspect in the way in which they approach this problem.

The fact is that opinion has changed in the last few months. One of my wisest advisers, a matron, when I first asked her what she thought about it said, "It sounds a good idea, but I don't think a separate Assembly will work". I asked her a few days ago whether she still held to that view and she said, "Yes, I do in a way, but I don't think it will work and for that reason I am against it". That rather is my line of thought: I do not think it will work. I do not think that it is right to talk about an Assembly when we have our own assembly in the Church of Scotland, or to talk about devolution.

The idea came from the Conservative Party in the 1940s when it built up the Scottish Office and made my noble friend Lord Home the Minister of State for Scotland. It was an enormous advance. I have some sympathy with the English or the Welsh who criticise the position of Scotland in that in some respects it is at an advantage.

As for the Scotsmen to whom the noble Baroness, Lady Elliot, referred, I keep thinking over this row in Israel that it was the idealism of a Scottish Conservative, A. J. Balfour, which created the whole idea of Israel. This is an important part of the contribution that Scotland has made to world affairs. I feel that it would not aid that contribution if we were to have the devolution which is pictured by the noble Lord, Lord Morton of Shuna, despite the wisdom and kindness of his speech.

4.30 p.m.

My Lords, those who oppose devolution are perfectly entitled to argue that in their view it will harm Scotland. However, they are not entitled to ignore the fact that the Scots want it. This the Scots have shown for a great number of years. Furthermore they have shown too that they do not want to be governed by a Conservative Government in London. They may be mistaken about that but they have made that abundantly clear and there is no possibility, in my view, of their altering that opinion. Indeed the more they see of this Government the less they like them.

Those who oppose devolution are forced to argue either that the Scots are not a nation and are therefore not entitled to decide their own destiny or that, although they are a nation, a parliament is not important to a nation. That is a very odd argument except when put forward in the Palace of Westminster. It is the case that every colony which has shown quite clearly that it wanted self determination has been granted it. Many people thought that they would he worse administered but nevertheless no one ever argued that the possibility of worse administration was a reason for not granting the wishes clearly shown by a nation.

I cannot accept that the setting up of a Scottish Grand Committee is very important. I have sat on that committee, as have other noble Lords. Of course it fails, in that it is not elected by the Scots. It has a built-in majority for the majority party in Britain, which is not the majority party in Scotland, and its agenda is set by the Government. Nor do I put much faith in administrative devolution. Of course it is a good thing up to a point but it is no substitute for legislative devolution. It is like saying that as long as the prisons are well run it does not much matter who makes the law. Therefore what the anti-devolutionists have to show is either that they think the Scots are not a nation or that a parliament is not important to a nation.

I come now to the economic arguments, which are very peculiar. To begin with one would think that the Scottish economy was flourishing. To hear some speeches from the other side one would think that the Scots were euphoric about their economy. If they were, they would return rather more Conservative Members to Parliament. In point of fact the Scottish economy is in a poor state and that in spite of the fact that oil is still booming. When oil disappears the position will probably be much worse. With Scotland's enormous unemployment and the state of many of its cities and so forth, it is no good telling us that everything is going to be all right in the future.

The economic argument is very strange. On one hand we are told that Scottish business and so on is terrified of devolution because it would be so hampered. On the other hand we hear from the noble Lord, Lord Cocks—and it is confirmed by the noble Lord, Lord Elliott—that the North of England is terrified that Scotland will get devolution because it will he so much better off. One cannot have it both ways. Either Scotland will be gravely damaged by devolution or it will be much better off. Apparently in the North-East, where the people are pretty shrewd, it is thought that the latter is true.

Furthermore, what is the evidence to show that Scotland cannot run its own affairs? What makes the anti-devolutionists think that the Scots are incapable of running their affairs at least as well as the British? It may be that mistakenly the Scots will elect a Labour majority in their assembly. But I am bound to say that Australia seems to have got on rather well with a Labour majority. I am bound to say that Glasgow is a good deal better administered than many cities in England. Therefore, though I am not myself an upholder of the Labour Party, I do not think that that in itself is a reason for denying the Scots the right to run their own affairs. If it is argued that small countries cannot run their own affairs and that only large countries can, then Russia should be the richest country in the world and Switzerland the poorest. This has nothing to do with size.

As for taxation, I do not know whether Scottish taxation would go up or down, but there is a strong case for levying in Scotland a different kind of taxation from that in England. There is a strong case, put forward long ago, for reducing taxation in the Highlands instead of having this crazy muddle with subsidies on which even the Government themselves are now going back.

I once introduced a Bill for Scottish devolution. I have come to the conclusion that the difficulties in the way are not nearly so big as people think. It must be simple. It should be drafted on the lines of preserving for the British Parliament the essentials and handing over everything else to a Scottish Assembly. It must have two features. It must include taxation and it must include less representation at Westminster. Clearly you cannot have an Assembly and also have a full quota of the present number at Westminster. If that is objected to, then the people must show what is the alternative.

The situation is dangerous. It is dangerous for a people who at least feel that they are a nation to believe that they are governed as a colony. It has proved disastrous all over the world, not least in Ireland.

4.35 p.m.

My Lords, I should like first of all to congratulate the noble Lord, Lord Morton of Shuna, even in the space of my five minutes, on his persistence in getting this debate down on the Order Paper. I agree with other noble Lords who have spoken that it is a big subject and is more suitable for a longer debate. There is a lot to he said but shortage of time prevents most of us from saying very much of it.

I agree with the noble Lord, Lord Grimond, that the Conservative Party should not just sweep the subject of the debate under the carpet and hope it will stay there. Whatever one's views may be, I think they are worth hearine, and discussing in this House and in the other place. It is just as possible that the anti-devolutionists will win the argument as the other way round. Indeed, until the noble Lord, Lord Grimond, spoke, it looked as if the anti-devolutionists were winning the argument here. As there is so little time, I shall come straight to one of the main arguments I wish to put to your Lordships and I hope it is something that will please everybody.

It has always seemed to me—and it seems so to many of your Lordships this afternoon—that the principal objection to devolution, though by no means the only objection, is that it would create another layer of government, another crowd of bureaucrats, departments, files and all the rest of it, and that all those things would have to be paid for. Thus in the past I have believed that there were stark alternatives before Scotland: either independence or the incorporating Union as it stands today. That was the situation in 1707 and in this respect I do not think things have changed very much since then.

By pure chance, however, it seems to me that one thing has changed. The local government Act of the 1970s swept away our old counties and our long-tried system of local government and substituted the rather absurdly named regions—Grampian, Strathclyde, Tayside and Central, whatever that is supposed to mean. Even today after 12 years these regions have so little acceptance that nearly all Scottish people still talk in terms of the old counties and even post their letters to them. It is significant that that is not the case in England and Wales. The regions are established only in travel brochures, AA maps and so forth, which when one reads them seem to be describing and delineating a foreign country.

Your Lordships will have noticed one thing about the regions. More than half the population is in Strathclyde. Strathclyde has within it the Lowland counties of Ayr, Lanark and Renfrew, the half Lowland and half Highland county of Dumbarton and the wholly Highland county of Argyle, including the Gaelic islands of the West, Isla, Tiree, Mull, Colonsay and the others. Strathclyde is thus a microcosm of Scotland as a whole, containing a diversity of historic areas with little to connect them except that they are all part of Scotland. Accordingly, I come to the one proposal I want to put to your Lordships this afternoon. It is that we should have a simple Local Government (Scotland) Act and put the whole of Scotland into Strathclyde. Less than half the population would be affected and a good many of those such as the inhabitants of Stirlingshire would hardly notice it. Having done this, I would suggest that the centre of government be moved from Glasgow to Edinburgh and that the new giant region be renamed Scotland.

That short Act would give Scotland devolution. Possibly Parliament might then consider giving the new Council of Scotland more power than is ordinarily enjoyed by local government in other parts of the United Kingdom. There are, after all, precedents for that in Stormont. We might rename the council an assembly, a parliament or, if we want to regain some sense of historic continuity, the Estates. The districts could be renamed counties and some of the boundaries might be redrawn so that people would feel more at home in the places where they live. Why not give it a try? It could hardly be more awful than the mess we are in at present.

4.40 p.m.

My Lords, the noble Lord, Lord Grimond, said quite simply that the Scots want an Assembly. I take up the feeling of the noble and learned Lord, Lord Wilson of Langside, when I say that I particularly welcome this debate as an opportunity for some of us to put part of the record straight on behalf of the large numbers of Scots—it was 30 per cent. last July in The Scotsman MORI poll—who, having given the matter some thought, simply do not agree that the best way forward has to be a Scottish Assembly and the 96 per cent. who at that time regarded other issues as of considerably more importance.

The record certainly needs straightening. So often in discussion about devolution in, for example, The Scotsman or the Glasgow Herald it seems to be assumed that the only people who really care about Scotland and its Scottishness are those who want an Assembly or parliament. Everyone else, it seems, is at best insensitive to Scotland's needs or at worst suffering from some kind of disability brought on by too much contact with England.

The impression given, intentionally or otherwise, is not only insulting to very many Scots; it is also increasingly alarming. It can only reinforce the growing number of younger people one now meets in southern England who find us Scots interesting mainly for our quaintness and begin to say "If they want to opt out, let them. At least it will mean that we are less likely ever to have a Labour Government again". We ignore that at our peril.

Of course we are a nation with a separate history, culture, law and institutions. Of course we want so far as is practicable specifically Scottish decisions to be made by Scots. But at the same time we are a nation within a multi-nation state. Our economy is part of the British economy. We require strong, very strong, representation in the British Cabinet and British Parliament to ensure we get the necessary share of the British cake to meet our special geographical and social needs. We have, as I calculate now, 9 per cent. of the population but we require 11 per cent. of Britain's identifiable public expenditure, which we have, 12 per cent. of education expenditure and 15 per cent. of housing expenditure.

It would be very interesting for us Scots to settle down of an evening to television and watch a Scottish Assembly arguing the toss in Edinburgh and it is an attractive notion for politicians, especially those from the Central Belt of Scotland who would hope to dominate. But what would be the cost for the people of Scotland? It would mean higher taxes than in England, as has been said, to pay for it, matching rises in prices, discouragement to incoming and existing industry and jobs, inevitably a loss of clout at Westminster and constant damaging conflict with England about our share of the cake.

As it happens, those problems were exactly the reasons why, after 100 years of trying to get the Scottish Parliament to fit into the United Kingdom, in 1707 we were forced to accept that it did not work and decided to get the full benefit, especially the economic benefit, of the United Kingdom Parliament. One day in the future the various parts of Great Britain might decide to go for a federal system. That might suit Scotland very well. In the meantime surely the true interests of Scotland lie in continuing and, if necessary extending the massive devolution we have now to Scottish Ministers and the Scottish Office, with its small branch office in Whitehall. And there is room for greater devolution, particularly, one suspects, in greater freedom for the Secretary of State for Scotland from constraints on the balance of his spending imposed by the Treasury. If we want more devolution, let us extend a system that works rather than build a whole new expensive edifice that clearly will not work.

4.45 p.m.

My Lords, I am in favour of devolution by evolution. I certainly hesitate to contemplate the enormity of a change as dramatic as that which has been painted, not only in this House but in another House, and which would so radically alter the management of the affairs of Scotland that the Scottish people, to all intents and purposes, become a separate nation state.

I listened very carefully indeed to the words of my noble friend Lord Cocks. I served in the Whips' Office at the same time as he did in another place and I can certainly support what he said, which was that as one saw the economic advantages which would accrue to a major element from devolution one realised there were others who were wretched in their economic circumstances and who saw that as a disadvantage.

One of the problems which this Parliament—not necessarily during the present Session, but at some time in the future—may have to face is that of trying to get the balance right. I believe that, for good or ill, in the past the British people have been moving more and more towards a unity, not only a unity of purpose but also a unity in organisation. When one looks at the range of matters, such as big business, that affect the welfare of people one sees that more and more of our businesses are managed not as separate entities but as national if not multinational businesses. Many of the businesses that were at one time Scottish are now an element and a part of a new business which is managed nationally. When one looks at transport, at roads, at entertainment and at television and radio one sees that barriers have been broken down.

Speaking in this debate I am very conscious that I cannot possibly speak with the background, the history and the emotion of the Scottish people, but I respect very much the fact that there is a Scottish dimension not merely on this issue but on many other issues. When one looks at devolution for Scotland, one also looks at the consequences for other parts of the United Kingdom.

For example, as regards the consequences of a greater devolution of power to the people of Northern Ireland, there are many people in this country who say that they wish we could get rid of what they consider to be bleak or black aspects of Northern Ireland being part of the United Kingdom. Yet we who have to face the terrible consequences of actions of this kind cannot simply look at such issues in terms of last year, this year or next year. We must try to have what I modestly call a historical perspective. For good or ill, we have to make the best of major changes of that kind. We have to improve what the people have.

I can understand the people of Scotland, who returned 50 Labour MPs out of the 70-odd, feeling very upset at the consequences that are being visited upon them as a result of having in Westminster a government who are not the kind of government they should have liked. But the answer for them is to bring about change by persuasion.

I live in Edmonton, and I remember when the London borough of Enfield was created out of Southgate. Enfield and Edmonton. There were a great many people who did not wish to come together, and who yearn even now for the days when they were separate bits. But, sadly, one has to recognise that time does not stand still, that these changes that have been made have to be tackled energetically and imaginatively. Centralisation is one thing. I only hope that the Government will recognise in their response that the people of Scotland are entitled to be treated seriously as a major region, if not a separate national entity within the United Kingdom. They deserve better treatment from this Government than they have had up to now.

4.50 p.m.

My Lords, as one of the few English speakers, I intervene because, as was the case when this matter was discussed nine or 10 years ago, my foremost concern is still the possible grave implications for the unity of the United Kingdom in the event of devolved government for Scotland.

One cannot debate the subject without considering the English dimension and that of the United Kingdom as a whole. One must emphasise that England represents 83 per cent. of the United Kingdom electorate, as against some 9 per cent. for Scotland. To me it almost defies belief that after the disastrous consequences to the last Labour Government of the devolution saga of 10 years ago the Labour Party appears to want to get entangled again in something so emotive and complicated as devolution. However, that is a matter for it.

I do not see any great evidence of the Scottish people wanting devolution. There were various polls in The Scotsman at the time of the last general election. It was only about 4 per cent., I seem to recall, who felt that devolution was of any great importance.

The rock on which any future devolution would again founder is not just how many seats at Westminster Scotland should have, but the intractable—what used to be called the West Lothian—obstacle which the Labour Party refuses to recognise because there is no answer. At present there is a considerable disparity between the size of the electorates per constituency in England and Scotland. In England, the average electorate is about 68,000 and in Scotland about 55,500. This discrepancy at the moment can be perfectly well justified on the grounds that Scotland has certain special problems and features. In some quarters it is felt that there is a degree of insensitivity to Scottish problems.

At the time of the devolution Bill in the late 1970s, it was becoming clear that in the event of devolution there would have to be a substantial reduction in the number of Scottish MPs. The noble Lord, Lord Grimond has said that his party now agrees with this. I think that almost everyone, with the exception of the real diehards in the Labour Party, is probably agreed that that would be so.

However, this still does not deal with the crux of the problem which is that after devolution there would still be a block of Scottish MPs able to vote on domestic English affairs while English MPs would not be able to vote on domestic Scottish affairs. Nor for that matter would Scottish MPs at Westminster be able to vote on domestic Scottish affairs. In other words, after devolution Scotland would be able to determine its domestic policies by electing the party she wanted in Edinburgh, but in England the electors would need to elect the party they wanted with a sufficient majority at Westminster to overcome any adverse or contrary majority of the other party deriving from Scotland. In my opinion, devolution for one part of a unitary state would raise the gravest constitutional problems.

It is relevant to point out that on three occasions since the war Labour Governments have been in the minority amongst English MPs. As I have said, England accounts for 83 per cent. of the electorate. As of now, this is a tolerable situation. But after devolution it would not be. In my opinion there would be all the ingredients for chaos, confusion and conflict, setting Englishman against Scotsman. There would be a narrow, inward-looking assembly with Edinburgh at loggerheads with Westminster and the union would be in jeopardy.

4.55 p.m.

My Lords, I cannot see that there is any case for devolved government in Scotland. Nothing that I have heard today from proponents of devolution has caused me to change my mind. Indeed I am convinced even more than 10 years ago that devolution is based on frantic sentimentalism and electoral expediency which will do nothing whatever to help Scottish people, their economy or welfare. A decade ago there was a feeling in some quarters that devolution had become respectable because of the rise of the SNP. It was thought that the SNP had become mature and responsible. But where are they now? I do not hear this great call for devolution from Scottish people.

Much has already been said by other noble Lords about the Labour Party's proposals. But one thing the Labour Party has continually glossed over is the so-called West Lothian question mentioned by my noble friend Lord Ellenborough. That concerns the role of Scottish Members of Parliament after devolution in the House of Commons. An honourable Member in another place, Mr. Dewar, replied when the problem was put to him—I quote from the Glasgow Herald of 18th November last year—that it did not need to be answered. This ostrich-like mentality towards difficulties is indicative of the Opposition's confusion towards devolution. Similarly, the Liberals have also got it wrong, though they have been getting it wrong for several decades with their belief in a Scottish parliament and federalism which is essentially flawed. Federalism by definition must require several different units to make up the federation.

This must therefore lead to the complete break-up of the United Kingdom and to many semiautonomous regions. I do not think that there is a call for such a drastic change, nor is there any proof that it would provide better government.

Would the noble Lord say that there is a drastic situation in West Germany?

One of the points about federalism is that it must require equal partners within its different constituent parts. I do not think you would get that by splitting up England, Scotland, Wales and Northern Ireland because England would always be the major partner unless England were split up. I do not think there is any call for splitting England up.

My main fear of devolution, however, is its implied threat over Scottish industry. Currently, businesses, especially multinationals, have to plan ahead for several years in their employment and investment strategy. If they ever believed that a Scottish Assembly with tax-raising powers was a serious possibility, they would change their views towards investment in Scotland quite dramatically. A few months ago a group called the Scottish Financial Enterprise gave a number of your Lordships a brief talk in a Committee Room upstairs. The group was set up by the Scottish financial services industry to promote its excellent record of employment and expertise in Scotland.

What came over strongly was that employment in financial services in Scotland has grown from 56,000 in 1971 to over 85,000 today, plus a further 45,000 jobs in other related activities. This is more than twice those employed in the traditional industries of mining and shipbuilding, as well as the technological industry of electronics. It is therefore an extremely important sector. We were left in no doubt at all at the meeting that the prospect of devolution would seriously diminish the role of the financial services industry in Scotland's economy.

Any discussion to promote devolution must surely show that people would be better served by it. I do not feel that this has been proved. Indeed, only the bugbears of an economy such as civil servants and more bureaucracy would do well. Scottish people I meet complain about government. It does not really matter of what persuasion that government is or whether it is based in London, Edinburgh or even Brussels. We should not be talking about more government for Scotland but less restrictive and better government for Scotland. I believe that this would gain the support of men and women all over Scotland.

4.59 p.m.

My Lords, to me the government and administration of Scotland are a mess. We in your Lordships' House and those in another place add to this mess from time to time by the ill-judged way in which we sometimes pass laws on Scotland without fully digesting the effect that they will have.

The government and administration of Scotland are like an old darned sock which is so full of patches that the original knitting can hardly be seen. As noble Lords will know, that kind of a sock produces friction, discomfort, blisters and pain. I feel that the government and administration of Scotland as it stands at the moment produce among the people of Scotland friction, discomfort and pain much too often. When we talk about devolution we are really talking about refooting the sock, as it were. We are talking about looking at the whole government of Scotland and putting the power to where it should be.

This afternoon we have heard a lot in the debate about the disadvantages of a particular Bill for an Assembly in Scotland but we have failed to look at the fact that the reorganisation of local government in Scotland was put through as a substitute for devolution. It was meant by the noble and learned Lord, Lord Wheatley, and his committee to be a substitute that would take the heat out of the devolution argument. In my opinion regionalisation destroyed in one enactment what dedicated Scots men and women had taken centuries to build up. It destroyed at local level our sense of identity, cohesion and community. In my view the noble and learned Lord and his committee did as much harm to Scotland as "Butcher" Cumberland and Patrick Sellar combined.

A sense of identity and community is essential in times of change, and we live in times of change. The whole world lives in times of change. We are in times of industrial change and social change. If we do not have a sense of identity and community we cannot contribute properly to the changes which are taking place in our midst. It is as essential to the individuals who make up the community as a sense of nationality. Indeed it is more important than a sense of nationality, because a nation is a sum of its communities and not the other way round. One does not make the country first and then divide it up. One develops the communities and then amalgamates them into nations.

It seems to me that what we have done to Scotland is to do away with the bottom tier and with the communities which made up the nation of Scotland. We should not be afraid of giving Scotland back its full identity as a nation, because one cannot get unity by force. One can only get it by agreement.

I suspect that the majority of the Members of your Lordships' House are parents and grandparents. I ask noble Lords how one holds a family together. One does not hold it together by refusing to allow one's teenagers to make any decisions for themselves but by giving them encouragement and by showing that one is prepared to treat them as equals. Then they will treat their parents as equals and they will contribute to the whole family. That is what we are asking to happen in Scotland.

We have heard that industry does not like the idea of devolution. I can tell the House from personal experience that Caithness Glass would never have been founded without the help and the backing of the local communities. My noble friend Lord Mackie of Benshie will confirm that that firm, which he led with such distinction for so many years, would not have been able to continue through the stormy seas it went through without the support of local communities and the patriotic spirit which kept it going in difficult times.

I shall finish by mentioning a survey which I heard reported on a radio programme as I was driving in the car. It had taken place in different areas of the country where there was high prosperity and low prosperity. Obviously the South-East of England had high prosperity and Scotland tended to have low prosperity. But in Scotland two towns have vastly differing rates of prosperity. The new town of Irvine, with all its government subsidies and all the assistance that it received from the Board of Trade and various departments, was one of the poorest and least prosperous places in which to live. Inverness, with all the disadvantages of being in the Highlands, was one of the most prosperous. My explanation for this is simple: no decisions are made in Irvine and all the decisions for one-fifth of the landmass of Britain are made in Inverness, because that is the centre of government for the whole of the Highlands area. If one gave back power to Scotland one would get cooperation from Scotland and prosperity in Scotland and England would be improved.

5.6 p.m.

My Lords, I suppose I should really declare an interest in that my forebear the first Lord Polwarth was Lord Chancellor of Scotland during the later days of the Scottish Parliament which then existed. I do not think that I see any proposals from the other side to resuscitate that ancient office.

I am very grateful personally to the noble Lord, Lord Morton of Shuna, who said some quite unmerited words about me, but I am sure that we are all grateful to him too for having raised this subject. The number of speakers has been clear evidence of the great interest that Scotland takes in its affairs and perhaps gives the lie to the noble Lord's suggestion that we are not sufficiently representative of interests in Scotland. I think that we have a pretty broad experience among us all of most aspects of Scottish life.

The consequence of these numbers is that we do not have time to have a proper debate. We have no time to probe and to question statements that have been made. But I should just question the statement that was made so bluntly from other quarters of the House that there is a strong demand among the Scottish people for a Scottish Assembly, let alone one with taxing powers. I do not think that any evidence was produced to justify those very outright statements. But time is running on and I should just like to say a few words on what we really need.

I do not believe—my noble friends Lord Goold and Lord Strathclyde put it so well—that more government is what is needed by what is effectively Scotland's life blood; namely, her industry, her commerce, her agriculture, her forestry and her fishing—the creative parts of the Scottish economy. On the whole all government can do is to try to make better conditions in which they can flourish. When governments go further than that they tend frankly to obstruct.

What we need is not fragmentation; Scotland is part of the United Kingdom and part of the European Community. All the trends today are towards breaking down barriers and harmonising former differences. Trade and industry depend particularly heavily in Scotland on their international links. That will become increasingly the case. I believe that the creation of an Assembly would almost inevitably increase tax if it had taxing powers and create one more obstacle to the free flow of economic activity across borders which has done so much for us in the past.

My experience over a number of years in trying to help to bring industry to Scotland is that what companies seek is the stability provided, first, by the English language—I hope I may call it that in this context—and, secondly, by our customs, our ethics and a well understood system of rules and of government. Once we introduce variety into this we are in grave danger of warning people off.

I should like to make reference again to my own experience, this time in Canada. Up to about 11 years ago Quebec housed the headquarters of a large number of major Canadian companies and the international headquarters of companies from all over the world. There was then a government with separatist tendencies, who raised taxation to a higher level than that in the rest of the country. Industry and commerce took fright. There was a massive exodus to the more stable and predictable climate of neighbouring Ontario. At the time I was the director of a great Canadian company and we had much heart-searching before we made the decision to move. However, in retrospect it was the only thing to do. Sadly, if you go to Montreal now you will see many large empty office blocks. Only a handful of major companies have stuck it out by keeping their headquarters in Montreal.

Finally, I should like to quote the words of Pope, which have been given to me by my noble friend Lord Selkirk. He said:
"On forms of government, let fools contest.
What e'er is best administered is best".
I believe that that is the line we ought to take. By all means, let us look at further scope for devolving power through the Scottish Office and other departments with major branches in Scotland. We have built a strong position in Scotland and I suggest that that is much healthier than is suggested by some of the more pessimistic utterances which we have heard today. We have built up that position as an integral part of the United Kingdom and through our world-wide connections. We must not jeopardise that position by tinkering with a constitution which has stood us in good stead for 280 years.

5.15 p.m.

My Lords, I am an English Peer and, as such, totally Strange. I am also Scottish. I live and farm in Scotland and I was educated in Scotland at, I believe, an older university than that at which the noble Lord, Lord Morton of Shuna, was educated. I am also totally Drummond. I speak, as it were, with a Scottish hat. However, lest your Lordships should find that reminiscent of Bernard in "Yes, Minister", I should perhaps say a Scottish bonnet. I shall not mix my metaphors by introducing my noble friend's cakes or the darned socks of the noble Viscount!

My five times great-grandfather, Adam Drummond of Megginch, was a member of the Scottish Parliament in Edinburgh and one of the commissioners who negotiated the union of parliaments in 1707. There was then so much poverty, intrigue and bureaucracy in Scotland that he was convinced that only a complete union of parliaments could save the Scottish economy and ensure the future prosperity of the Scottish people. Far from being the end of an old sang, it was the beginning of a lot of jolly good tunes.

Two hundred and eighty years on things have not changed. In April 1987 the Scottish CBI said that an Assembly would mean increased taxation, more bureaucracy and possible misdirection of public funds. The General Secretary of the Scottish Trade Union Congress has said that he will not support a Scottish Assembly unless it dramatically improves the quality of life in Scotland. My Lords, it would not.

I am sure that your Lordships are wondering what has happened to my English hat. What advantage has accrued to us English by the union? We have gained the telephone, the steam engine, tarmacadam roads, television, helicopters and many other useful things. The husband of my noble friend Lady Elliot has saved Westminster Hall for us. We have gained Prime Ministers, a Lord Chancellor and many other distinguished people in life. I think that your Lordships will agree that the Scottish and indeed the Welsh Peers have contributed much to this House, as have the Scottish Members of another place.

After 280 years we have become one nation with one Parliament. We can all wear the common hat of being British, for we are all uncommonly proud of being part of Great Britain.

My Lords, when I read the list of speakers in today's debate, my regret was that the House had not moved to Edinburgh for the debate. I am sure that it would have enhanced the reputation of the House in its concern for Scottish affairs.

We are not discussing political slogans about Scottish nationalism; we are discussing an exercise in constitutional devolution. As the noble Lord, Lord Morton of Shuna, said in his opening speech, it is not useful, and neither do we have the time, to discuss details. There is a great deal of detail to be discussed on the issue. However, I address the issue on the basis of the simple proposition that I support a greater devolution of government for the sake of the democratic well-being of the country.

If there is one thing this country has suffered from, it is too great a concentration of political and economic power. The increase of mergers in the economic and industrial fields and the increasing power of central government, which has been a feature of the legislation of this Government, are damaging to the democratic idea and practice. Therefore, I support the proposition that there should be a greater degree of devolution.

That proposition need not frighten away Scottish industry. I should do nothing that would be injurious to the welfare of Scottish industry, for I have spent a good deal of my time attracting industry to Scotland. It would not be a disservice to the financial institutions of Edinburgh, which are able to communicate with all parts of the world by means of electronic systems. It would not destroy our prospects of bringing companies into Scotland. Indeed, it might enhance them.

As I understand the present position in Scotland, the Exxon Corporation is paying £9 million to the Fife County Council in rates at the present time. If it had put its factory south of the Border, the tax burden would have been £1.2 million. Industry is being punished in the present situation because of the unfortunate rating system which exists.

I support the general proposition of devolution because it counters the increasing centralisation of power. Governments and other institutions south of the Border have shown a certain insensitivity to the Scottish people and their feelings. I shall give two illustrations. Recently the Nature Conservancy Council, which has some statutory authority, declared that the Highlands of Scotland should have no more planting of trees for the next two or three years. Recently it had a press conference in London to announce the freeze in the development of forestry and consequent loss of jobs in the north of Scotland. It did not consult the Highlands and Islands Development Board. That sort of behaviour provides the necessary propaganda for the Scottish Nationalists. The imposition of the poll tax on Scotland before it is imposed on England is another matter that offends the sensitivity of Scottish people. We are not going to be guinea-pigs and have a poll tax imposed on us.

Unfortunately, the insensitivity which I have mentioned encourages wrong attitudes on the part of Scottish people. The chairman of British Aerospace went to Prestwick recently to congratulate the workers on the production of the Jetstream aircraft. One of the workers met him and said, "You have come here to close us down". The chairman replied, "I have come to congratulate you on your achievement. Why should I close you down?". The worker replied, "Because we are Scottish". It is that sort of attitude, encouraged by Scottish Nationalists, which is wrong. They are exploiting the decent instincts and pride of the Scottish people and exaggerating some of the issues.

I am in favour of devolution—devolution on certain conditions. The first is that we abolish one tier of government in Scotland if we are to have a Scottish Assembly. We do not want an increase in the bureaucracy or expenses of government in Scotland; so one tier of government would require to go. Secondly, I am in favour of devolution in Scotland as part of an exercise in national devolution of power in the United Kingdom and not necessarily as an isolated Scottish affair.

Thirdly, I am in favour of making government more responsible to the Scottish people, giving them a greater sense of involvement by electing any new Assembly on the basis of proportional representation. I do not want another Strathclyde Mark 2 sitting in Edinburgh. That would be a duplication of government and it would not be totally representative. We would avoid some of the distortions that exist in local government in Scotland if there were a system of proportional representation in which minorities felt that they had a voice. They do not have that at the moment.

On those bases I would certainly support the general proposition of the noble Lord, Lord Morton of Shuna, without necessarily agreeing with him on all the details which are contained in the Labour Party programme.

5.21 p.m.

My Lords, I am only too pleased to thank my noble friend Lord Morton of Shuna for having initiated the debate today. It is some indication of the general interest in the subject that there were so many speakers in the debate. Obviously it is impossible to deal with all the issues from this side of the House, but the general points will be considered or have been dealt with in the past.

The first thing to say is that as far as concerns my noble friend and myself, this debate has nothing to do with separation. We have never been involved with separation. For a long time I have regarded separation as a rather infantile type of politics. I am sure that that is the sort of remark that will not make me popular in one or two parts of my own area.

I think it is important to mention the last referendum, which was held in 1979. Noble Lords will remember that at that time there was a consensus throughout Scotland that some form of devolved government was required. It has frequently been commented upon and was mentioned again most pertinently last year in another place. Malcolm Rifkind was keen to remind us in the late 1970s that he had campaigned for 10 years for a directly elected Assembly. He dismissed opponents of devolution as "diehards" and "last ditchers". He said that devolution was necessary because on top of the demand of national sentiment there should be added:
"the need for good government, good administration and a better deal for Scottish people within the United Kingdom".
He went so far as to say that for Scotland to have a legal system without a legislature to improve, modernise and amend it was "a crazy anomaly".

To some extent the noble Lord, Lord Home, who deservedly commands great respect in all parts of the House, agreed with the general sentiment that some change in the system was needed because of the rate of change in the modern world. He spoke in terms of there being too much power in London, but he wanted decentralisation and improved administration.

Turning again to the referendum of 1979, Mrs. Thatcher, who was Leader of the Conservative Party at the time, and the noble Lord, Lord Home, went to great lengths to tell the people of Scotland that to vote no would not mean an end to devolution but would lead to all-party talks. I was very close to Conservative Party members in my former constituency and to be quite honest I think they felt rather lonely—unlike in the days of the noble Baroness, Lady Elliot, when she knew the old Kelvingrove. They had become a small group and were mainly in favour of devolution until the statement from the noble Lord, Lord Home, which carried great weight. They were persuaded that a no vote would be correct, so they voted no. In the referendum 63 per cent. voted, 37 per cent. abstained and there was just a slight majority. I must admit that I was not willing to have devolution on the basis of the size of that majority.

The figures of the noble Lord, Lord Goold, on the survey of Scottish business do not quite match with the figures that I have been given on that survey. Perhaps he would give me an analysis and let me know how he arrived at his figures. According to my reckoning only 29 per cent. of those who were asked replied and only 17 per cent. of those asked agreed with the Government in opposing devolution.

All of us in Scotland, and people from many parts of the United Kingdom, are worried about the concentration of power and decision-making in the London area. Devolution is an attempt to reverse this trend and return power first to Scotland and then to other parts of the United Kingdom. I believe that a Scottish Assembly, using the various Acts that are available, would be able to rejuvenate the Scottish economy. Responsible Ministers would be much closer to business and local government in Scotland. We believe on this side of the House that that is the way the world is going and that sooner or later Scotland will have its own devolved Assembly within the United Kingdom.

5.26 p.m.

My Lords, first of all may I go along with everyone who has congratulated the noble Lord, Lord Morton of Shuna, for instigating the debate. It is a welcome chance to discuss this important subject, and I am very pleased that so many people have seen fit to join in. As my noble friend Lord Belhaven and Stenton said, it proves that in this House we are not prepared to sweep under the carpet this very important subject, which I believe has to be debated at very regular intervals.

I should like to single out for special mention those noble Lords who do not live in Scotland but who have taken part in the debate. I do so quite deliberately because this subject is of relevance not just to those of us who live in Scotland but to the whole of the United Kingdom. I especially welcomed the speeches from my noble friend Lord Elliott of Morpeth and the noble Lord, Lord Graham of Edmonton, as well as the amusing but very straight and important speech of the noble Lord, Lord Cocks.

Those who, like my noble friend Lord Elliott of Morpeth and myself, live on either side of the border have no yearning to return to the days of cross-border differences. I echo the words of my noble friend Lord Home who said in Edinburgh this week:
"With Scotland in unity with England, the United Kingdom in unity with Europe and Europe in unity with the Atlantic Community, there can be no threat to our increasing wealth".
I found those words about unity very important. They were echoed, if I heard them right, in the speeches of my noble friends Lord Selkirk, Lady Elliot and Lady Strange.

I shall come back to the subject of wealth and wealth creation later in my remarks. Those words about unity took me back to my noble friend Lord Pym's analysis in a pamphlet written in December 1978 on the devolution issue when he wrote:
"Each part of the state must belong to the union on similar and compatible terms so that all citizens are members of the state on the same basis bearing the same relationship to those in power and authority at each level of government".
He added that,
"the line for responsibility must be absolutely dear so that a citizen is certain where power, responsibility and authority for any decision lie".
This was referred to in the speech of my noble friend Lord Home when he talked about the United States. It must be the starting point, in my view, for any debate on devolution, because in your Lordships' House, although we differ on many things, we are essentially all unionists.

I was very interested in, and I congratulate the noble Baroness, Lady Saltoun, for, a very clever speech on the subject of marriage. I was always told that for a good marriage one had to work very hard at it. That is true of any union and in particular, as the noble Baroness pointed out, a marriage between England and Scotland. We have a common belief in the importance of the union. And just as good plants have to be tended carefully to grow, so we have to be very sensitive to the problems and opportunities that lie within a united kingdom such as our own.

Many noble Lords taking part in this debate lived and worked in Scotland during the 1970s when, in modern parlance, one could describe devolution as the flavour of the decade. We had the Kilbrandon Commission in 1973, White Papers in 1974 and 1975, minor ones in 1976–77, and the Scotland and Wales Bills in 1976 and 1977, as the noble Lord, Lord Cocks, has reminded us. The Scotland Bill was one of the most complex ever to come before Parliament but, in my view and that of many others, fundamentally flawed.

It is right to point out that at that time The Scotsman said that the provisions for devolution in the Bill suited party rather than Scottish democracy. Neither that Bill nor the one unveiled by the Labour Party in November takes proper account of the role of Scottish Members of Parliament at Westminster or the role and status of the Secretary of State. Those of us in this Chamber who are unionists must be concerned to avoid a constitutional change that would weaken Scotland's place in the United Kingdom. I agree wholeheartedly with those who say that any form of unilateral devolution would gravely weaken Scotland's involvement and influence within the United Kingdom. I was very interested in—and I have seen myself—the situation in Canada where there has been an exodus of many businesses from the state of Quebec to Ontario.

I agree with those who have talked about the slippery slope to independence. Although I quite understand the response of the noble Lord, Lord Carmichael, when he says that this debate will have nothing to do with separation, I do not think that one can completely forget the possibility of a slippery slope to independence if we do not get our constitutional change absolutely right.

In passing, can I say how much I agree with my noble friend Lady Carnegy. I find it very strange that those who seek to preserve the union and all that it means and who find fault with devolution plans brought forward by any party can be branded as being against the best interests of Scotland. On the contrary, I would argue that they are the guardians of the Scottish interest. It is crucial for the good government of Scotland that the position of my right honourable friend the Secretary of State for Scotland is safeguarded so that Scotland and its people's views are fully represented with authority at the Cabinet table. I make this point in a non-partisan way. I am very well aware of the long line of Secretaries of State for Scotland of different political persuasions who have been able to argue Scotland's case within Cabinet. And this has been very much in Scotland's interest.

I come now to a point raised in a very interesting speech by the noble and learned Lord, Lord Wilson of Langside. He said that perhaps the noble Lord, Lord Morton, had oversimplified the situation. I believe we have to be absolutely certain before we move that the role of the Secretary of State for Scotland is safe and that the whole question of Scottish representation at Westminster is not put in jeopardy. This was acknowledged by the leader of the Liberal Party in his speech in another place on 23rd November. However, unlike the leader of the Liberal Party, I regard the loss of an effective Scottish voice at the highest level as an unacceptably high price to pay for devolution.

On the West Lothian question, I was very interested to hear the noble Lord, Lord Cocks, say that he had had a tremendous amount of trouble within his own party. He will have known this subject only too well when it was before him in another place and argued very forcibly by the present Member of Parliament for Linlithgow—the creation of a Scottish Assembly with substantial powers that would exclude English, Welsh and Northern Ireland Members of Parliament from debates and votes on most Scottish issues. However, most Scottish Members would retain the right to speak and to vote on all United Kingdom issues including those concerning England, Wales and Northern Ireland.

This question was referred to by my noble friends Lord Ellenborough and Lord Strathclyde. Unlike some, I believe it has to be answered. It is a ludicrous anomaly that would immediately arise in the course of the new situation. We have to address the issue very thoroughly and have a proper answer. I do not think that it is good enough to toss the matter off and to say, as some do, that it will work out all right. I fully accept, however, the arguments of the noble Lord, Lord Mackie of Benshie, and others that a federal system with proportional representation, as proposed by the Liberal Party, is a logical approach. It avoids some of the pitfalls of the proposals in the Scotland Act 1978 and the current measure put forward by the Labour Party. It is logical, if one is determined to introduce some form of devolution.

However, federalism assumes willing partners. Federalism cannot be introduced for one part of the United Kingdom in isolation. The Government see no evidence of a demand across the board for such a major constitutional change. I do not think it is only on the Benches behind me that Members feel that they cannot support a change to proportional representation. This subject has been debated quite recently in another place.

I turn now to one of the arguments put forward by the noble Lord, Lord Morton of Shuna, about the Conservative Party not having a mandate to govern in Scotland. I find this a surprising argument. The Labour Party cannot have it both ways. After the last election, which was fought on a UK basis, the Government received a UK mandate. Labour governments of the United Kingdom have relied in the past on their Scottish and Welsh Members for majorities. There is nothing wrong in that. In 1964 and 1974 there was no suggestion that they had no mandate to govern the rest of the United Kingdom despite the fact that it was Scotland that gave them their slim overall majority. I say in all sincerity that if the Labour Party wants to govern Britain let it set out its policies so that people nationwide have a chance to endorse them. For it to claim to set up a parliament in Scotland, which it believes it can control, is surely not the best way forward for a unionist party.

I agree with the noble Lord, Lord Graham of Edmonton who comes from the north of England and understands the position in that part of the country. He said very sincerely that we have to think through the consequences of devolution for Scotland or anywhere else in the United Kingdom.

It has been said that a separate legal system would lead inevitably to a separate Scottish Assembly. But the absence of a Scottish Assembly has not prevented a whole raft of distinct legislation for Scotland being built up over the years. In many areas Scottish legislation has been of a pioneering nature. I am not referring to the community charge Bill. There are such things as the licensing laws which were referred to in the House earlier today. We have been told how much better we had done our business in Scotland than we had south of the border. There was the 1980 Bill banning drink at football grounds; there was the establishment of children's panels. Those are three examples of very good Scottish legislation showing the way forward.

Whatever views we might hold of particular pieces of legislation, there can be no doubt that it is perfectly possible to legislate for Scotland under the present arrangements in a way which takes full account of the Scottish dimension. I noted carefully what my noble friend Lord Home said about Scottish legislation and perhaps the Scottish Grand Committee meeting more often in Edinburgh. After the 1979 election, as your Lordships will know, meetings of the Grand Committee started to take place in Scotland. Second Readings of a number of Scottish Bills took place in that committee. But I shall take back what has been said in the debate so that we can consider the situation.

I come now to what I believe to be a very important consideration which is topical with the announcement on the industrial front yesterday of changes in regional support. We are all interested in creating wealth in Scotland and in seeing a vibrant Scottish economy. I was glad to see the welcome for the announcements we made yesterday given by the Scottish CBI and the Scottish Council for Development and Industry. A distinguished Member of the House, the noble Lord, Lord Taylor of Gryfe, is a member of that council. I cannot take on board exactly what my noble friend Lord Ferrier said about the Scottish press. Some might say so, but I was only too pleased to see, coming from the middle of a development area in Dundee, a headline saying, "A fairer system for business grants". That is what we hoped would have been the message that we conveyed to Scotland.

I was also grateful for the support given by all sections of the House in support of the Scottish Development Agency at the recent passing through the House of the Bill increasing its borrowing powers. Despite the siren voices, I think it is a great credit that in the last year or so we have seen £13·50 of private money to £1 of taxpayers' pump-priming money going into industrial investment in Scotland. There were very much lower figures in earlier years. That must be good.

I have to say with all sincerity and with all the power at my command to the noble Lord, Lord Morton of Shuna, that I reject his words just before Christmas in this House when he called the 1980s in Scotland a dead decade of lost opportunities. Having lived in an industrial context in Scotland through the 1970s and 1980s I just do not recognise those words. I very much supported the views of my noble friend Lord Goold in the debate today. Yes, indeed, as has been said by the noble Viscount, Lord Thurso, change on the industrial front has been very great. It had to be; but I reject strongly the idea that it is a dead decade of lost opportunities. Far from it.

We now move on to the Bill which is proposed by the Labour Party to vary the power of taxation. I cannot believe that that means reduced taxation. Therefore, we have to look at a possible extra tax burden on individuals and industry. In 1985–86, the last year for which figures are available, income tax in Scotland amounted to £3·4 billion. It takes no mathematical genius to work out that every £100 million of extra revenue would require an increase in tax of about 3 per cent. How on earth can that be described as beneficial to the encouragement of business and job creation? I do not see it. If the noble Lord had sat, as I did in the recent past, in boardrooms sanctioning capital expenditure in Scotland, he would know that had there been the remotest chance of a threat of increased taxation, those sitting round the boardroom table would have taken very different decisions. I do not believe that people have thought through seriously the implications for industry and commerce of higher taxes in Scotland. I have to say to my noble friend Lord Elliott of Morpeth that it might bring comfort to him to have taxation higher in Scotland than in England, but it would be devastating for Scottish industry.

I have heard that there is a clamour for devolution in Scotland. I do not see a demand for it. In assessing demand, polls have their uses and they would seem to follow a consistent pattern. However, we remain prepared to consider constructive changes in the machinery of government and I have been most interested by what has been said during the debate by my noble friend Lord Home and others about the machinery of government in Scotland. I hope we are not seen, as one noble Lord said, as dictators at the Scottish Office. Let us hope not. I think that our doors are perhaps somewhat more open than those of some other departments, but that is a matter of opinion.

The arrangements for the government of Scotland which have evolved over nearly three centuries represent, like most of our unwritten constitution, a triumph of experience over theory. I believe that the real issues that matter in Scotland are jobs, health, housing and education. We must not be diverted from those essentials by attempts at constitutional change such as the Scotland Bill—

My Lords, the time allotted for this debate has now elapsed. Does the noble Lord wish to withdraw his Motion?

My Lords, I think it might be better if I moved to withdraw my Motion for Papers.

Motion for Papers, by leave, withdrawn.