Scotland Bill

My Lords, I thank the noble Lord, Lord Forsyth, for his amendments and for opening this debate. I also thank him for the opportunity to make a speech that will, I hope, over the hours that we will spend on debating these and related issues, be considered to be multipurpose. I had expected—and anticipated in preparing my speaking notes—the amendments of my noble friend Lord Foulkes to have been regrouped, for maybe the second time, with those of the noble Lord, Lord Forsyth. Therefore, I wrote a note to myself to apologise to both noble Lords for giving a generic response, rather than addressing all the subtleties of the individual effects of their amendments. I do so because this is, ultimately, an issue of principle. I do not devalue all the detailed points that underpin the argument that the noble Lord, Lord Forsyth, put forward about the interesting debates that we could have in Scotland on the referendum and the detail of these specific taxation powers. However, whether we have a referendum on them is an issue of principle, and there are principles that we ought to apply. I will deal with that. I am sure that we will then get to the detail through the revised groupings, or re-revised groupings, of amendments that I have in front of me. The noble Lord, Lord Forsyth, has indicated that the details are exercising him. My second point is one that I have made before. I deeply regret that timetabling prevented the other place dealing with the detail of these very important issues. The last time that we convened this Committee, we had a very interesting debate on Clause 28— probably for the first time anywhere in the United Kingdom, unfortunately. It is a matter of deep regret that our elected representatives in this Parliament were denied the opportunity for debate by timetabling, thereby denying us a quarry of their position that we could mine to inform our debate. Therefore, when we draw on what we believe is the will of the Scottish people, as expressed by their elected representatives, we draw on information that unfortunately cannot be in the public domain, such as conversations and observations. Some of us have expertise that we have built up over time from watching what is happening in Scotland and knowing, from the conduct of politicians, what the people they represent are telling them. That is deeply unfortunate but it is where we are. There is a bigger issue at stake in the politics of Scotland, but I will come to that strongly later in the debate. We should keep our eye on the prize, which at this time is the union of the United Kingdom. There is a political imperative at the moment that should dominate everything that we do. I regret that we are sometimes forced into undermining that by the way in which this has been handled, which has been deeply inefficient. I turn to the principle of referendum. I do not believe that there is any constitutional imperative to hold a referendum on the devolution of financial powers to Scotland, as provided for by Part 3 of the Bill, for the following reasons. First, the conclusion of the Select Committee on the Constitution in its 2010 report, Referendums in the United Kingdom, was: "““We do not believe that it is possible to provide a precise definition of what constitutes a 'fundamental constitutional issue'””." It is a fascinating publication for the reasons that I am about to explain to your Lordships' House. The committee did not look specifically at the example of the devolution of financial powers, although it could have because it was in the air. Therefore, noble Lords are entitled to look beyond such a conclusion to test whether what has been described by government Ministers as the largest transfer of financial power from London since the creation of the United Kingdom would be a likely candidate for a referendum. In looking beyond the committee's conclusions, we should look at the evidence that was heard, which is deeply instructive. If noble Lords will excuse me, I will go into this in some detail because it is interesting. Before I rehearse some of the evidence, I am prepared to concede that people who listen to this debate may think, on the basis of the expert testimony to the committee, that there is a legitimate view that that evidence tends towards the view that the devolution of financial powers would commonly be considered a candidate for referendum, given that the definitions posited included the following. I will share a number of them with noble Lords. In giving evidence, Professor Gallagher referred to, "““fundamental questions concerning sovereignty or a major constitutional settlement, especially if they concern steps that would be completely or virtually irreversible once enacted””." The Institute of Welsh Affairs, in its evidence on page 126, referred to, "““truly major issues of democratic principle—change that alters fundamentally the nature of the state””." Caroline Morris, who is an expert, gave two definitions: "““Topics ... which directly affect the constitutional make-up and powers of a state””," and, "““changes to the sovereign powers of a state””." My noble friend Lady Kennedy of the Shaws gave the following definition: "““Anything that changed the power balances within our democratic system ... anything that in any way redistributed power in a significant sense””." Professor Bogdanor cited: "““Legislative proposals which provide for a radical alteration in the machinery by which the laws are made””." Professor Saward referred to, "““significant, encompassing and lasting change in the formal and general rules and rights which locate political authority””." Professor Graham Smith mentioned, "““anything that changes the dynamic and the relationship between the people and those who are elected””." All these definitions, which are not mutually consistent, could support the argument of the noble Lord, Lord Forsyth. However, they must all be considered against the backdrop of historic precedent. As the Constitution Committee noted in its analysis, no definition of principle can be extracted from historic precedent.