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Mr. Robert Maclennan (Caithness, Sutherland and Easter Ross): Will the right hon. Gentleman clarify the Conservative party's intentions on a referendum on the euro? Does he suggest that we should hold a referendum after the United Kingdom has signed up to the euro and after any necessary legislation may be in place, or does he suggest that we should have one before?
Mr. Hague: The hon. Gentleman cannot make that analogy. I am not disputing that a referendum should be held before a Scottish Parliament is established, which is his analogy. A referendum should be held before a Scottish Parliament is established, and a referendum should be held on a single currency, if the issue ever arose, before the United Kingdom entered it.
We are debating a quite different matter. We are debating whether a referendum should be held on proposals that may subsequently be changed or be held in a manner that would bully Parliament into approving, without proper debate, legislation that is proposed in a referendum. That is the point at issue.
Mr. David Trimble (Upper Bann):
Will the right hon. Gentleman give way?
Mr. Hague:
I must must press on if I am to finish and allow other hon. Members to speak, but I will give way to the hon. Member for Upper Bann (Mr. Trimble).
Mr. Trimble:
Perhaps the right hon. Gentleman might like to consider the position in Northern Ireland, where I think that there has been bipartisan agreement. I am glad to see the Minister of State for Home Affairs and Devolution, Scottish Office, the hon. Member for Central Fife (Mr. McLeish) nodding. The position there has been very clearly understood. There is agreement between the parties that legislation will be passed by the House, which will then be put to the people in a referendum. In a Northern Ireland referendum, therefore, the Government's clear position is that a referendum will follow legislation.
Mr. Hague:
The hon. Gentleman makes an extremely telling point, and I hope that the Secretary of State for
That is not our only objection to the referendum proposals. It is striking that the Government are not, so far, proposing any threshold of positive votes or overall turnout. A referendum with a low turnout could be a highly unsatisfactory method of changing the British constitution. I hope that the Secretary of State for Wales will tell us with what percentage of the population voting yes he would be happy. Would he be happy with a result in which 20 per cent. voted yes and slightly fewer voted no? Would that be a mandate on which to embark on a major and highly expensive change?
The proposals--
Mr. Hague:
It is too late to ask questions of the Opposition. The right hon. Gentleman and his party are now the Government; it is our job to ask the questions and their job to answer. They have to get used to that.
Mr. Hague:
Given that it is the right hon. Gentleman, I shall give way once more. I then hope to get on and thus allow other hon. Members to speak.
Mr. Dewar:
I appreciate the fact that Governments have to answer. I also remember that on occasions the right hon. Gentleman used to ask me about my party's policy and intentions, so I hope that he will bear with me if I ask him to be a little more frank. Is he saying that the Conservatives will try to amend the Referendums (Scotland and Wales) Bill to impose a threshold? On what principle will that threshold operate? If he believes in thresholds, will he answer the question asked by the hon. Member for Banff and Buchan (Mr. Salmond) and confirm that a similar threshold will be applied to similar referendums in future if the Conservative party has its way?
Mr. Hague:
Of course the Opposition will table a number of amendments to the Bill, and some will deal with the question of possible thresholds. However, it is a matter which the Government cannot ignore.
The proposals pose great dangers for the future of the United Kingdom. They are badly thought out, illogical and inconsistent. The proposed Scottish Parliament would create a direct conflict with the role of this House and, while Scottish Members of Parliament continued to determine policy in England, the existence of such a Parliament would amount to nothing less than the gerrymandering of our constitution.
The proposals for Wales amount to the most expensive roomful of hot air in recent political history. Frustrated and hamstrung, such an Assembly would find that its proceedings were either a total waste of time or would have little to do but apportion blame elsewhere and create conflict with other tiers of government. Its workings would be more likely to lead to fresh disillusionment with the political process than to ease any current dissatisfaction.
That such controversial and damaging proposals should be put to referendums is right; that they should be put to referendums in this way and according to this timetable is wrong. It is one thing to use a referendum to find out whether the people approve of a measure passed by Parliament, which they can judge in its entirety; it is quite another to use the device of a referendum to bully Members of Parliament to curtail debate while keeping the people guessing about what the precise and eventual consequences might be.
Mr. Tam Dalyell (Linlithgow):
It is surely common ground on this side of the House that if there is to be a Scottish Parliament it should have some chance of lasting in the form that a Scotland Act of 1997 or 1998 proposes.
Were we to pass legislation in the knowledge that what we proposed would soon turn into something different, we would be dishonest with ourselves and with the people.
To have a chance of lasting, a Scottish Parliament must have tax-raising powers; anything else would be a talking shop culminating in frustrated fiasco. Furthermore, my personal view, for what it is worth, is that a Scottish Parliament should be able to use its tax-raising powers from the day on which it is opened.
The White Paper must deal with many questions. Who exactly is to pay the tax? Will it be everyone domiciled in Scotland?
With regard to international tax, state borders provide the touchstone for separating the taxing rights of one fiscal regime from another, but where the border is, in essence, not real--as between Scotland and England--the imposition of tax by reference to the familiar tests of residence, domicile, source of income and location of trading operations is likely at best to be complex and expensive and at worst to be unfair and a major brake on doing business in Scotland.
Is there to be wholly arbitrary exemption for companies?
What is to be done about peripatetic pop stars, business men, or, indeed, Members of Parliament who spend more than half a year outside Scotland? We might be caught by a residency rule, but one can imagine the howls of outrage if we escaped.
What about an Englishman on temporary secondment to Scotland for six months? Would he be treated as a resident for a whole year or a payer of Scottish higher income tax on his English income?
In the UK, a new Scottish tax would be working against the framework of there being, in effect, a tax haven next door in England. I hope that that matter will also be dealt with in the White Paper.
I thank the Secretary of State for dealing with the issue of the Barnett formula. Lord Joel Barnett is a friend of mine. I talked to him and I know that the matter is extremely complex. There should be a statement on the Barnett formula because some people in Scotland are deeply concerned, not least those who have to deal with resources for local councils.
What will be the consequences for the financial arrangements between Scotland and the rest of the UK if the Scots decide to raise income tax by 3p in the pound?
Will the Government of the UK be expected to put the same amount into Scotland as they would if income tax were the same there as in England and Wales?
If the Scots decided to cut taxes, would the English taxpayer be expected to make up the difference?
I hope also that the White Paper will address what John Lloyd in Scotland on Sunday called the Bury North question. A new Labour Member of Parliament has won the not overly rich Bury North seat from a sitting Conservative--in this case, David Chaytor won it from Alistair Burt. How can it be explained that Scotland should have more Members of Parliament than England and Wales, more public spending per head than England and Wales and, on top of that, a Parliament of its own?
I know that the figure is open to argument, but I understand that identifiable public spending in Scotland is £4,505 per head while it is £3,614 in England-- a difference in Scotland's favour of 24.6 per cent. That will have to be addressed in the White Paper. There is no way of ducking it.
Before we leave the subject of money, is the Parliament to be paid for out of Scottish Office allocation or out of United Kingdom funds?
I listened to what my right hon. Friend the Secretary of State said about mandates. My mandate was far more emphatically for more nurses in St. John's hospital, Livingston than for 129 politicians in Edinburgh.
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