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Mr. James Wallace (Orkney and Shetland):
Hon. Members may recall that I made it perfectly clear on Second Reading and in Committee that the Liberal Democrats were sceptical of, and opposed, the second question. However, the House voted for it, and we must consider the consequences of deciding the precise wording. Perhaps it does not matter over much, as I think that the Government have the balance of the argument. The right hon. Member for Devizes (Mr. Ancram) pointed out, at the prompting of the hon. Member for North Essex (Mr. Jenkin), that the Scottish Parliament could alter or replace the form of council tax and could devolve control of non-domestic rates to councils. That would be a tax-varying power in addition to its income tax power.
First, I congratulate the hon. Gentleman on becoming a learned Gentleman. If the Government really mean to limit the question to income tax, why should not the Bill say so? Surely the meaning of a Bill should be clear on its face. I do not understand why, if it is the Government's intention that the question be limited to income tax, the Bill should not say just that.
I thank the right hon. and learned Gentleman for his kind words.
I think that I said that the Scottish Parliament will have the power to vary local taxation. The power to vary income tax is the power to vary not the whole of income tax, but only one part of it. Part--income from dividends--will be excluded. Therefore, it could potentially be misleading. The right hon. and learned Gentleman said that it should be on the face of the Bill. We are talking about a ballot paper that will refer to the Government's proposals. I have already questioned the Minister about how far the abbreviated objective form of his proposals will go. If he heard the House today with regard to the tax-varying powers, he will have understood from the mood of the House that it must be full and complete. If that is what people are being asked to vote upon, it is important that, on that specific point, they are given a considerable amount of information.
I regret that the hon. Member for Vale of York (Miss McIntosh) has left the Chamber. I did not mean to be ungallant towards her. She referred to an education
process, but her very question betrayed the fact that her understanding of the Government's proposals which will be put in the referendum was limited, and that is why the education process is needed. She said that the Scottish people would have to face up to the fact that they would lose some expenditure advantage and that income tax rates would rise enormously. For a start, the White Paper makes it clear that the Barnett formula has been retained. It also puts a limit on the powers of the Scottish Parliament to vary taxation. Therefore, the very premises of her question were wrong. That is why she should acquaint herself with the terms of the White Paper.
I thank the hon. Gentleman for giving way so gallantly. My hon. Friend the Member for Vale of York (Miss McIntosh) not being here, may I point out that the information that she was using came not from political sources but from the Scottish Law Society, which is a very fine body and well able to interpret what it sees in a White Paper? The confusion that the hon. Gentleman has highlighted would not exist if the Prime Minister had kept his promise to publish the Bill before the referendum.
I think that my interpretation of the White Paper is better than that of the Law Society of Scotland, if that is what the Law Society of Scotland has said. I am sure that the Minister will confirm that when he replies to the debate.
Is not what the hon. Gentleman is describing the essential fraud of the second question, which is that, even if the second question is rejected by voters, any Scottish Parliament would still have tax-varying and raising powers?
Inasmuch as it has powers with regard to local government taxation, the answer is yes. However, it ill becomes the architect of the poll tax to make such a point. The very man who stood at the Dispatch Box tonight and said how appalling it would be for Scotland to be out of line with the rest of the United Kingdom was the very man who imposed the poll tax upon Scotland a year ahead of the rest of the United Kingdom.
Let me keep this as simple as I can. The White Paper is there. A shortened version will be presented to the Scottish people. Let the Scottish people decide. I trust that they will decide yes.
Mr. John McAllion (Dundee, East):
I intervene only briefly. I have to be brief anyway, given the guillotine. So far in this debate, for the past three hours, the only Scottish Back Bencher who has spoken has been my hon. Friend the Member for Linlithgow (Mr. Dalyell). I rise in part just to make it clear to the House that my hon. Friend does not represent the views of Labour Back Benchers. In fact, he is a bit of a loner in terms of his views on a Scottish Parliament.
I sometimes wonder whether my hon. Friend and I stood on the same election manifesto at the recent general election when we were committed to holding a two-question referendum. I am committed to a Scottish Parliament with tax-varying powers and I am here to argue for the manifesto on which both of us were elected. I only wish that he were here to do precisely that as well.
As the hon. Member for Orkney and Shetland (Mr. Wallace) said, it is the height of hypocrisy for Tory Members to come here and worry about back-handed,
back-door taxes being imposed on the people of Scotland. During the past five to 10 years, Tory Governments have continually cut revenue support to local councils, forcing them to increase council tax as a back-door method of taxation. For the right hon. Member for Devizes (Mr. Ancram) to accuse the Labour Government of trying to do that is unbelievable hypocrisy, particularly coming from the very man who argued that Scotland should pay higher taxes than anywhere in the United Kingdom when he introduced the poll tax legislation a year in advance of it being applied anywhere else in the United Kingdom. He did not worry about Scots paying higher taxes at that time.
rose--
I am not giving way. There is no time. The right hon. and learned Gentleman has made several long speeches tonight and the Scottish people will be delighted if he has to button his lip for a change.
Earlier tonight, my hon. Friend the Member for Linlithgow was complaining about the effect of the tax-varying powers on local government in Scotland. He complained about the unified business rate. He referred to the negative impact of the Scottish Parliament having control of the unified business rate on Scottish businesses in particular. I am a personal friend of my hon. Friend, but I must ask him in all sincerity whether he has any conception of how arrogant is that argument. He is saying that only this Parliament can possibly get it right when it comes to business taxes in Scotland; that any other Parliament elected by the Scottish people would, by definition, be inferior to this Parliament; that it could not come to the right decision about how the business rate should be applied in Scotland or about whether the council tax or a local income tax was the way in which to finance local government services. He is saying that we in Westminster are so superior that other Parliaments could not possibly get it right when we always get it right.
Any hon. Member who has been here for the past 10 or 20 years knows how many local government Bills have been forced through the House, almost every one of them destroying one aspect or another of local government; almost every one of them getting it wrong in one way or another.
I, as a Scot, would be delighted if control over local government finance were transferred back to Scotland and decided on by elected representatives of the Scottish people who live in Scotland all the time, who are much closer to Scottish businesses and who understand the Scottish dimension much more than people in this Chamber ever can.
My hon. Friend should start to realise that Scotland is a nation with national rights, which is every bit as good as any other part of the United Kingdom and can come to decisions that are in the interests of the Scottish people. [Interruption.] If the right hon. Member for Devizes had changed his views and joined us on the Labour Benches, he would still represent a English constituency rather than one in Scotland. His views will not be tolerated in Scotland. That is why he had to go to Devizes. The Edinburgh people threw him out a long time ago and they were right to do so.
The reality is that all the changes proposed by the Labour Government, both in terms of varying the rate of income tax and giving control over the finance of local
government to Scotland, are well known to the Scottish people. The Scottish Constitutional Convention has been debating those issues for six years. It has widely publicised its views. There has been a huge debate in Scotland. Everyone in Scotland knows what the powers of a Scottish Parliament will be. They are in the White Paper that was published only last week. There will be a debate between now and the referendum, but everyone knows the kind of powers that will be given to the Scottish Parliament. It is hokum and bogus for the Opposition to--
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