Scotland Bill

Frank Roy Excerpts

Thursday 26th April 2012 Commons Chamber

[David Mundell]

The amendment changes the title. If the hon. Gentleman is alluding to whether the Scottish Government, in their discussions on the Bill, put forward a requirement for further devolution of the Crown Estate, I can tell him that they did not. It was not a red line for the Scottish Government.

[Mr Frank Roy (Motherwell and Wishaw) (Lab)]

Are any costs associated with the name change?

[David Mundell]

As far as I am aware, no costs are associated with changing the name from that proposed in the original Bill to the revised one.

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[Mr Bain]

I heartily agree with the Secretary of State.

The Bill is good for democracy in decentralising certain financial powers, and good for the Scottish economy in devolving the right levers to promote further growth.

[Mr Frank Roy]

Will my hon. Friend confirm that, in effect, this really is devo-max?

[Mr Bain]

It is intriguing. We have several descriptions: “indy-lite”, “devo-plus”, “devo-max”. Various formulations for additional powers have been put out for public discussion. I think this is “devo-positive”. It will give the Scottish Parliament additional democratic legitimacy by enabling it to raise about 35% of what it spends—far more than at present—but without the race to the bottom with other countries or parts of the United Kingdom on tax rates, including corporate tax rates, which would be very damaging for growth.

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[Bob Stewart]

Thank you, Mr Deputy Speaker. The amendments will certainly be welcomed by the Stewart Society, which I shall be speaking to in two weeks’ time.

It is absolutely right that Members of the Scottish Parliament should have responsibility for raising more money, and the amendments will help them to do that. I am also pleased that MSPs will be more accountable to the Scottish people. I fully support, as do most people in this House, the fact that the Scottish Parliament will have responsibility for health, education, transport and the police. I am very pleased with the amendments.

[Mr Frank Roy]

Would it not be a great shame if all these amendments were to fall because, for some bizarre reason, the people of Scotland decided to separate from the United Kingdom?

[Bob Stewart]

It would be horrific if that were to happen. The Opposition and the Conservatives are all Unionists in this regard. It would be a disaster if there were any kind of separation of our great nation. Scotland is much more powerful through being connected with the English, the Welsh and the Northern Irish.

I am delighted to end my speech here. My jokes have been cut short by the unkindness of the Deputy Speaker, who will not allow me—

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[Pete Wishart]

What the Scottish people are hearing is a compelling case for Scottish independence, and the question will be put to them in a couple of years. The overwhelming majority of them will endorse and support it. We look forward to having that debate over the next couple of years, because we are absolutely confident that we will secure that overwhelming majority.

[Mr Frank Roy]

Will the hon. Gentleman tell the House what made the Bill a bad Bill, and what it is that now makes it a good Bill?

[Pete Wishart]

To be fair, this is a much better Bill now than it was a year ago. All the damaging economic powers that would have cost Scotland so much have gone. I am also glad that the UK Government have agreed with the Scottish Government on commencement powers, so that we will no longer be exposed to the damaging measure that would have had a massive and dramatic impact on Scotland.

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[Pete Wishart]

I do not know whether the hon. Gentleman heard my exchange with the Minister, but this is to do with commencement powers. The agreement of the Scottish Parliament will now have to be sought before any tax-changing powers are brought in, which is right and appropriate. That will ensure that we do not go down any route that could damage the Scottish economy or the way in which the Scottish Parliament is funded.

I can see that you are keen for me to speak to the Lords amendments, Mr Deputy Speaker. We welcome the amendments. It is unfortunate that the hon. Member for Dundee West (Jim McGovern) is not here, but he will at last be able to refer to the Scottish Government as, well, a Government. The days of the Executive—and the unambitious Executives of the past—are finally at an end. The term “Executive” refers to boardrooms and golf clubs. It is Governments who run Scotland. As long as we are in charge, it is a Government, it will continue to be a Government and it will have the powers of a Government.

[Mr Frank Roy]

Will the hon. Gentleman confirm that his party voted for the Scotland Act 1998, which introduced the Scottish Executive?

[Pete Wishart]

One of the first things we did when we came into government, back in 2007, was to ensure that we were a Scottish Government. If it looks like a Government, walks like a Government and quacks like a Government, it is a Government. We will continue to be that Government. The days of the unambitious Labour-Liberal Executive have now gone, and thank goodness for that.

We welcome the amendments, and I look forward to discussing the others and finding out why the Labour party has changed its mind on—

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[David Mundell]

As I have already explained, on 21 March the Government announced a package of measures in the Bill, and supporting non-legislative arrangements, to ensure that the Bill would operate in a fair and sustainable way to benefit Scotland and the rest of the United Kingdom. That announcement followed productive discussions with the Scottish Government.

I hope that it does not prove career-limiting for him if I pay tribute to Bruce Crawford MSP, the Cabinet Secretary for Parliamentary Business and Government Strategy in the Scottish Government, who has worked closely with me and with the Secretary of State on the dialogue that has been taking place about the Bill. Mr Crawford and his officials have always engaged constructively in discussions on the Bill, and, even on occasions when we have not agreed, we have always conducted those discussions in an orderly and proper fashion. I am most grateful to Mr Crawford for the way in which he dealt with the legislative consent motion in the Scottish Parliament, securing a unanimous outcome. There was no dissent from any member of the Scottish National party.

Following the agreement announced on 21 March, changes were made to both the finance and non-finance provisions in the Bill. Since its introduction in November 2010, it has been subjected to detailed scrutiny in the United Kingdom and Scottish Parliaments. In Westminster, it has passed successfully through its Commons and Lords stages, and has returned to the Commons today for further consideration. In Holyrood, not one but two Scotland Bill Committees have taken evidence and reported to the Scottish Parliament. I pay tribute to my colleague David McLetchie MSP, who experienced the pleasure of serving on both those Committees. I think that his expertise could rightly be said to be beyond that of Members of this House and the other place, in that he has a true understanding of the Bill and all its ramifications. I also pay tribute to the other MSPs who served on both Committees for their work in dealing with the reports, and subsequently passing the legislative consent motion tabled by the Scottish Government in favour of the Bill.

We have gone further than ever before in working with parties in Scotland and across the United Kingdom to deliver a Bill built on cross-party consensus. We have carefully considered and, when appropriate—that is, when a case based on evidence has been properly made—taken on board the views of the Scottish Government and the Scottish Parliament. We are pleased that we have reached agreement and can make progress with the Bill.

The package of measures announced on 21 March meets the tests that the Government set for changes in the Bill package. They are based on evidence, maintain the cross-party consensus that supports the Bill, and will benefit Scotland without detriment to the rest of the United Kingdom. The amendments in this group are part of those changes. Lords amendments 2, 5, 6, 17 and 26 would remove clause 7, clause 12, schedule 2, clause 13 and clause 26.

Lords amendment 2 would remove clause 7. As it stands, section 33 of the Scotland Act 1998 allows for only a Bill, rather than a single provision of a Bill, in the Scottish Parliament to be referred to the Supreme Court in its entirety on questions of legislative competence. That means that implementation of the whole Bill would be delayed if the matter were referred to the Supreme Court pending a decision of that court. The Government’s intention in pursuing the limited reference procedure contained in clause 7 was to prevent unnecessary delays on Bills the majority of whose provisions were considered to be within the legislative competence of the Scottish Parliament.

The Scottish Government expressed the fear that the clause could have the potential to introduce unintended consequences and delay to the enactment of legislation in the Scottish Parliament. As a result of our discussions with the Scottish Government, we agreed that the clause could be removed. The Scottish Government accept that that will mean that in future, as at present, only a full Act of the Scottish Parliament can be referred to the Supreme Court, even if only a single provision raises competence issues. I should make clear that the provision in the original Bill was intended to be helpful to the Scottish Government. However, they decided that they did not want that helpful measure to be included, and as a result we agreed to remove it.

Lords amendments 5 and 26 would remove the clause on insolvency and the related provision in schedule 2. Clause 12 would return exclusive legislative competence to the UK Parliament in relation to all aspects of the winding up of business associations. It is intended to ensure that the rules on corporate insolvency are consistent on both sides of the border. The UK Government continue to believe that it is important to take into account the view of stakeholders that, when appropriate, Scottish insolvency procedures should be in step with those in the rest of the UK. Our discussions with the Scottish Government have provided us with assurances that we can address those concerns without amending the devolution settlement in this respect.

Let me make clear to Scottish National party Members that the UK Government have removed the clause on the understanding that the Scottish Government will consider the modernisation measures for the devolved areas of winding up in Scotland that were introduced into the reserved insolvency procedures in 2009 and 2010, and have provided assurances that future changes made by the UK Parliament or Ministers in that area will be considered in a timely fashion by the Scottish Government in their area of competence.

Lords amendment 6 seeks to remove clause 13. The clause deals with the regulation of health professionals, to which the right hon. Member for Stirling (Mrs McGuire) has already alluded. Since Royal Assent to the Scotland Act 1998, the regulation of any health professionals not regulated by the legislation listed in schedule 5 has fallen within the legislative competence of the Scottish Parliament, but although the Scottish Parliament has had the power to introduce separate legislation in respect of the regulation of health professionals, it has chosen not to do so.

During our discussions with the Scottish Government, they raised some concerns about the clause. They pointed out that the delivery of health care is, on the whole, devolved to Scotland. However, they gave us clear assurances that they would work closely with us to ensure that consistent regulatory regimes apply to all health professionals. I assure the right hon. Member for Stirling that it is on the basis of those assurances that the UK Government are content to continue to develop policy in relation to the regulation of health professionals with the Scottish Government.

[Mr Frank Roy]

Does this not prove that some things should be done on a UK-wide basis rather than on the basis of a separate Scotland?

[David Mundell]

During consideration of the Bill in the House of Commons and by the Committees of the Scottish Parliament, I was not aware of a single piece of evidence suggesting that the regulation of health professionals would benefit from not being carried out on a UK-wide basis. In fact, it has been pointed out that health professionals are a relatively mobile group who may want to move to and from jobs in Scotland and England, and who would therefore not benefit from separate regulation.

[Mr Roy]

Presumably the SNP agrees with that.

[David Mundell]

As I said earlier, the Scottish Government have given assurances that although there will not be a relevant clause in the Bill, they will work with the UK Government to ensure that there is a uniform approach to the regulation of health professionals. I think that those remarks are consistent with the First Minister’s statement yesterday that he intended to align taxes in Scotland with those in the rest of the United Kingdom if Scotland became independent. In fact, if Scotland became independent, there would be no difference on virtually any matter.

Lords amendment 17 would remove clause 27. The Government included that clause to provide UK Ministers, concurrently with Scottish Ministers, with a power to implement international obligations in devolved areas. That would have allowed UK Ministers to implement international obligations on a UK basis, where it would be more convenient to do so. Both Governments acknowledge the importance of ensuring that all of the UK’s international obligations are fully implemented across the UK in a timely fashion. The UK Government are willing to remove this clause on the understanding that Scottish Ministers will ensure that any international obligations that fall within their responsibility are implemented on time. We have made clear to Scottish Ministers that the Government would be prepared to use their existing powers of direction under section 58(2) of the Scotland Act 1998 if we were to have concerns about the implementation of international obligations within the remit of Scottish Ministers.

Let me make it absolutely clear that the Government have not conceded on the principle of re-reservation, as the Scottish National party suggested during our earlier debates on this Bill. The Bill does not make devolution a one-way street. Clause 14 re-reserves the regulation of activities in Antarctica.

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[Mr Bain]

Thank you, Mr Deputy Speaker. The hon. Lady tempts me to make future tax policy. However, the point she makes is that corporation tax is better levied and raised at UK level, and that is what we shall be defending in the debates on these amendments and the debates in the coming months.

The agreement between the UK Government and the Scottish Government provides that borrowing limits will be reviewed regularly, ahead of UK spending reviews by the Joint Exchequer Committee, and a consultation will be initiated on the Scottish Government being able to issue bonds. The annual reports will allow Members of this House and the Scottish Parliament both to scrutinise the detailed arrangements made by Her Majesty’s Revenue and Customs and the Scottish Government in the run-up to implementation and the first five years following the commencement of operation of the new fiscal powers, and to permit any remaining issues—such as the precise interpretation of the definition of a Scottish taxpayer, as raised by my hon. Friend the Member for Glasgow North (Ann McKechin) in Committee—to be resolved before the tax powers become active in April 2015. It is also our view that the reports will provide an opportunity to scrutinise arrangements made at Holyrood on the workings or replacement of stamp duty land tax. We welcome the new commitments on giving consideration to bond issuance by the Scottish Government, and the additional capacity that such borrowing powers will provide to the Scottish Government to make capital and infrastructure investments, which are vital for Scotland’s economic competitiveness.

The requirement to make annual reports will also show the strength of the financial powers being devolved by the Bill. The Scottish Consolidated Fund will have sufficient balance to ensure cash flow on the devolution of these new tax powers and to manage any excessive in-year volatility of tax receipts. It will also meet differences between forecast and out-turn receipts on income tax allocated to the Scottish Government at the beginning of the relevant fiscal year.

[Mr Frank Roy]

Presumably the safeguards that my hon. Friend just spoke about will not be there if Scotland separates from the United Kingdom. Is that the case?

[Mr Bain]

Indeed, one of the benefits of being part of the United Kingdom is that we enjoy a fiscal union in which there are significant fiscal transfers from the UK level to Scotland. The evidence published in January 2010 by my right hon. Friend the Member for East Renfrewshire (Mr Murphy), when he was Secretary of State for Scotland, indicated that in the 20 years running up to 2008, fiscal transfers of about £75 billion had taken place. That is the Union dividend; that is the benefit that Scotland has obtained from remaining part of the United Kingdom, and we will defend that in the debates in the coming months.

These powers to meet any differences between forecasts and actual receipts of income tax rise to a cumulative limit of £500 million and permit an annual increase in capital investment of up to £230 million per year, subject to a cumulative limit of £2.2 billion from the national loans fund, the Public Works Loans Board or commercial banks.

We welcome the fact that the Scottish Government have not persisted with their demands on the devolution in the Bill of corporation tax or excise duty, which would not be in the interests of the people of Scotland at this time. Finally, may I say that we offer our support for this amendment and the others in this group?

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[Rory Stewart]

Thank you, Madam Deputy Speaker. I am happy for us to discuss Scottish history later.

We are discussing transparency, which is exactly what Lords amendment 18 relates to—explaining to this Parliament, to the Scottish Parliament, to the British people and to the Scottish people what we are doing with their money. Transparency is crucial because money is at the heart of this. On the one hand, the Scottish National party uses money to fight for separation through fantasies about oil. On the other hand, English nationalists, who are equally to blame for what is happening to the United Kingdom, focus on money to attack Scotland. This is the wrong thing to do.

Lords amendment 18 matters because it should, we hope, put those arguments aside. There are those who imagine that we are going to wreck the United Kingdom because we are worried about free eye tests, prescription charges or tuition fees. For goodness’ sake, let us, in line with Lords amendment 18, see the money. What we will see is that we are spending every year in transfer payments to Scotland half of what we are spending on the war in Afghanistan, if we include the debt and veterans costs. The reason why we need to move beyond this is that the kind of borrowing enshrined in the clause and amended in Lords amendment 18 is the borrowing that made us great together.

The very economics that underlie that notion of borrowing came south from Edinburgh with Adam Smith and the enlightenment. The very same borrowing on the basis of the United Kingdom meant that Scots and English were able to fight together at Waterloo and win. The very borrowing enshrined in clause 37 is what allowed us to create the national health service together. The very borrowing enshrined in clause 37 and amended and made transparent in Lords amendment 18 is what allows us to flourish today. I urge the House to vote for Lords amendment 18 because it enshrines the principle of togetherness.

[Mr Frank Roy]

The hon. Gentleman spoke of a possible history debate with the hon. Member for Dundee East (Stewart Hosie). We invite the hon. Member for Penrith and The Border (Rory Stewart) to come to the Floor of the House, because I am sure that the debate is one that the whole House would like to hear, and no doubt we know who the winner would be.

[Rory Stewart]

I thank the hon. Gentleman very much indeed.

Having been a little rhetorical, I will return to the measures set out in the new clause proposed in Lords amendment 18. I congratulate the example set by my hon. Friend the hon. Member for Milton Keynes South in the moderation of his tone. The conduct of the Ministers in this regard, which has been praised by the hon. Member for Dundee East (Stewart Hosie)—he is now leaving the Chamber to research in his history books—shows exemplary co-operation and is an example of why the United Kingdom Parliament works so well. The moderate voices of the hon. Member for Milton Keynes South and the shadow Minister show that separation is unnecessary. The correct praise for the Scottish National party for its successes shows the successes of autonomy, not of separation and independence. If we can get the principles of transparency correct and the exact details of Lords amendment 18, the sinews of the Union, the point-by-point, sometimes dry legislative amendments that allow us to work together and avoid what the Scottish National party wishes to push us into—a black-and-white solution of either fatal inertness or still more terrible activity—we will instead, through a voice of passionate moderation and amendments of this sort, keep together the Union that made us great and will make us greater still.