Queen’s Speech

My Lords, the grand pageantry of the royal opening last week, impressive as ever, on this occasion hid the rather vacuous content of the Speech that the Government put in Her Majesty’s hand. Ministers’ comments since the delivery of the gracious Speech, and indeed the leaks prior to that, have indicated that it is only a short introduction to the Labour Party election manifesto, which promises to be equally vacuous. What interests me particularly in the gracious Speech this evening is this statement: ""In Scotland, my Government will take forward proposals … from the Commission on Scottish Devolution and will continue to devolve more powers to Wales"." I have read Sir Kenneth Calman’s report on Scotland, and I am sure that we will all be interested in which proposals precisely are to be taken forward. Are the proposals for the appropriation of taxes raised in Scotland, for exclusive Scottish parliamentary use, to be acted on, for example? The Welsh equivalent, the All Wales Convention report produced under the leadership of Sir Emyr Jones Parry, was published only last Wednesday, the day of the state opening, and of course the Government can be exonerated from expressing a view on its contents. It was commissioned by the Welsh Assembly Government. I hope that the Minister, in replying to this debate, will comment on this most valuable report. It has involved a great deal of work and effort and has cost, I am told, some £1.3 million to produce. The overall conclusion of the report is that Part 4 of the Government of Wales Act 2006, ""offers substantial advantage over the present arrangements in Part 3"." Therefore, it should, by implication, be implemented. While some would dispute this conclusion, there is not much doubt that the present arrangements, which we are familiar with, are complex and imperfect. Primary legislative powers are devolved to the National Assembly for Wales on an ad hoc, piecemeal basis, either through framework clauses in England and Wales Acts, or by the passage of legislative competence orders. This is a slow and cumbrous process, as the report describes, compared with a once-and-for-all transfer of legislative powers over devolved areas, as proposed under Part 4 of the 2006 Act. Of course, there is ample scope for improving Part 3 procedures. But, leaving that aside for a moment, the crucial rub in all this is that Part 4 cannot be brought into effect without an affirmative referendum of the electorate in Wales. That has to be demanded by a two-thirds majority of Assembly Members, endorsed by the Secretary of State within 120 days and then approved by both Houses of this Parliament. Bearing in mind the very slender majority of 0.6 per cent by which devolution was approved in Wales in the referendum of 1997, these hurdles are as daunting as the fences of the Aintree Grand National. The convention report’s judgment is, ""that a ‘yes’ vote is obtainable but the evidence we have collected underlines that there can be no certainty about this"." This lack of certainty about the outcome helps to explain why the present Secretary of State, Mr Peter Hain, has always warned against holding a referendum prematurely. As Secretary of State he has a critical role in that, even if the National Assembly were to take the lead and call for a referendum by a vote of two-thirds in favour, he could still bar the way during his 120 days’ consideration of that vote. He may well be encouraged to do so by a substantial cross-party selection of Westminster MPs, who might support such a stand. A battle line would thus be drawn between the National Assembly in Cardiff Bay and the Wales office in Whitehall and Westminster. Mr David Cameron, the Conservative leader, has said that if he were in government he would not oppose a referendum if the Assembly called for one, and I am told that the Conservatives in Wales would have a free vote on the issue. Here, perhaps, is another reason for a change of government. Meanwhile, as Sir Emyr’s report indicates, people in Wales have a great deal to learn about the intricacies of their governance, but that is likely to be among their lesser worries over the months and possibly years ahead. One of the early declared aims of devolving powers to Wales was to raise Welsh GDP in relation to the rest of the United Kingdom. Alas, that has not happened during the decade of comparative prosperity; Welsh GDP has declined in the UK context. As Professor Kevin Morgan, who headed the "Yes" campaign in 1997, acknowledged in an article last May, it is time that we recognised "devolution’s dirty little secret"—his words, not mine—that there is no economic dividend necessarily from political devolution. Unemployment in Wales currently stands at 8.7 per cent, nearly one whole percentage point higher than in the UK as a whole. Meanwhile we have not yet seen the end of the recession or the beginning of a fall in unemployment. Last week, the OECD forecast worse to come, with nearly 10 per cent unemployment in the UK in 2010-11. Like the rest of the United Kingdom, we in Wales are particularly concerned with our young people without work who threaten to become a lost generation. The full effect of the recession on devolved government in Wales and elsewhere is yet to be seen. Devolved government has thrived on fulsome budgetary provision, with more and more money year after year, but we know only too well that there are lean years to come and severe reductions in expenditure. This Government, after all, are committed to reducing borrowing and to halving the deficit—how, we do not yet know. Devolved government will not escape the cuts and will have to learn to live in straitened circumstances. Of course, they will blame central government and bite the hand that feeds them. Finally, the convention’s report judges that moving to Part IV will be financially neutral, but I suspect that the Treasury and, indeed, the rest of us will take a lot of persuading on that particular score, in view of the past exorbitant increases in the bureaucratic costs of devolution. The prospects as I see them, then, are far from bright and, indeed, we need a radical new approach.