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Session 1999-2000
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Delegated Legislation Committee Debates

Draft Scotland Act 1998 (Modification of Schedule 4) Order 2000

First Standing Committee on Delegated Legislation

Tuesday 20 June 2000

[Mr. Jimmy Hood in the Chair]

Draft Scotland Act 1998 (Modification of Schedule 4) Order 2000

4.30 pm

The Minister of State for Scotland (Mr. Brian Wilson): I beg to move,

    That the Committee has considered the draft Scotland Act 1998 (Modification of Schedule 4) Order 2000.

Like most orders under the Scotland Act 1998 that have come before Standing Committees since last summer, this one is primarily a tidying exercise.

The context of the order is that schedule 4 to the Scotland Act forms part of the definition of the legislative competence of the Scottish Parliament. It places restrictions on the extent to which certain legislation, including the Scotland Act, can be modified by the Scottish Parliament. Section 30 of the Act provides a mechanism whereby schedule 4 can be modified by an Order in Council, subject to the approval of the United Kingdom Parliament and the Scottish Parliament. That allows the boundary of legislative competence to be adjusted or clarified. The purpose of the order is to clarify the boundary in respect of two matters: pensions and the Scottish consolidated fund.

I shall deal first with pensions and, specifically, pension sharing. When the Scotland Act was drafted, the concept of pension sharing had not sufficiently developed to enable the Act to deal with it fully. The position is now settled following the passing of the Welfare Reform and Pensions Act 1999, as a consequence of which it has become necessary to amend schedule 4 to the Scotland Act to bring it into line.

General pension law and, in particular, the law dealing with the sharing of rights under pension arrangements on divorce are reserved matters. Nothing in the order changes the extent of the reservation that is set out in schedule 5 to the Scotland Act. The order is concerned with the complex rules in schedule 4, which determine the extent to which the Scottish Parliament can amend rules of Scots private law, even though they relate to reserved matters.

Paragraph 2(1) states that an Act of the Scottish Parliament cannot amend the ``law on reserved matters''. That ``law on reserved matters'' would include the aspects of pension law reserved by schedule 5. Paragraph 2(3) relaxes that restriction for rules of Scots private law. With section 29(4), that allows the Parliament to modify Scots private law as it applies to reserved matters, so long as the purpose of the provision is to make the law in question apply consistently to reserved and non-reserved matters.

Certain rules of Scots private law are protected from amendment if they are ``special to a reserved matter'' or are listed in paragraph 2(3). The order extends the list of protected provisions of Scots private law to include pension obligations introduced by the Welfare Reform and Pensions Act 1999. Following the chain of exceptions to exceptions, the inclusion of the new entries to schedule 4 ensures that no modification to these rules of Scots private law can be made by the Scottish Parliament. I hope that that is clear.

In practical terms, we would not expect the amendments made by the order to have any great effect. They do not change pension law or Scots private law at all.

Mr. Dominic Grieve (Beaconsfield): Will the Minister give way?

The Chairman: Order. The Minister is moving the motion.

Mr. Wilson: Nor is it likely that the Scottish Parliament would wish to legislate in this area, which is already pretty well the preserve of the United Kingdom Parliament. Schedule 4 was intended to cover pension sharing on divorce and the order simply ensures that its terms fit in with the Welfare Reform and Pensions Act 1999 now that the concept has firmed up. I could summarise that as a small earthquake with not many dead.

The second aspect of the order relates to the Scottish consolidated fund and I refer hon. Members to paragraph 4 of schedule 4 to the Scotland Act, which has the effect that the Scottish Parliament cannot in general amend the Scotland Act. That is hardly a great surprise. However, it was recognised that is makes sense to allow the Scottish Parliament to amend some aspects of the Scotland Act, so provision is made for that restriction to be relaxed in specified instances. One of those instances, which we are debating today, is to allow the Scottish Parliament to modify some of the references to the Scottish consolidated fund. The purpose of this part of the order is to add one further type of provision to the areas that the Scottish Parliament may legislate to amend in the 1998 Act.

At present, and subject to certain exceptions, the Scottish Parliament can legislate to amend provisions in the Act that

    charge sums on the fund

    require sums to be paid from or to the fund.

However, the Scottish Parliament cannot legislate to make amendments to provisions of the Scotland Act that provide for expenditure to be ``payable out of'' the Scottish fund.

There are two provisions in the 1998 Act which provide for sums to be ``payable out of'' the Scottish consolidated fund and which, therefore, the Scottish Parliament cannot amend. The first is section 21(6), which provides that any expenses of the Scottish Parliament corporate body shall be payable out of the fund. The second is section 51(5), which in effect provides that the salaries and allowances of the Scottish Administration civil servants are payable out of the fund.

Hon. Members may wonder, as I did, what is the distinction between sums ``payable out of'' and sums that are

    Charged on the Scottish Consolidated Fund

The answer is that ``charged on'' means that money has to be paid out of the fund without any further approval, whereas ``payable out of'' means that money can be paid out of the fund only if the Scottish Parliament specifically agrees to the expenditure—normally by its inclusion in a Budget Act—[Interruption.]

The Chairman: Order.

Mr. Wilson: The upshot is that, under the legislation as it stands, the Scottish Parliament cannot legislate to put in place alternative arrangements, such as having some part of the Administration staff or the affairs of SPBC, funded directly from the proceeds of trading.

It was never intended that those parts of the Scotland Act should be put beyond the reach of the Scottish Parliament. The amendment made by the order will, with the agreement of the Committee allow the Scottish Parliament to amend them if it wishes. It is a purely tidying exercise. We have no plans to use the new power, but the order will allow the Scottish Parliament greater flexibility.

As I said at the outset, the order is thus concerned more with good housekeeping than with constitutional policy. It is with complete confidence, Mr. Hood, that I can assure you and the Committee that the order contains no matters of substance. I shall be pleased to respond to the Committee's questions; if I cannot give a full reply today, I shall do so in writing.

4.37 pm

Mr. Dominic Grieve (Beaconsfield): It is a pleasure to hear the brief words of the Minister. Both the measures that he proposes appear to be wholly innocuous.

I have one query about the pension sharing arrangements. The Minister explained that Scots private law in respect of pension sharing is protected from alteration save with the consent of the House—it is a reserved matter. That is obviously sensible because of the need to maintain a unified law on pensions in the United Kingdom. I assume that the proposed changes are wholly discrete to that one issue and would not provide a wider scope for making alterations to Scots private law on pensions to the Scottish Parliament without further reference to Westminster. I assume that that is the position; I would be grateful if the Minister could confirm it. On that basis, I can see no possible objections to the order.

4.38 pm

Sir Robert Smith (West Aberdeenshire and Kincardine): I rise to urge the Minister, as I warned him I would do when we last discussed amending constitutional law, to consider the difference in how Members of the House of Commons are treated compared with Members of the Scottish Parliament with regard to the flow of information that comes with such orders. The order before the Committee has three small paragraphs, and it is up to the members of the Committee to decide what other information they want. Members of the Scottish Parliament are provided with a page and a half of explanatory notes, which go further into the order, plus the relevant parts of the Scotland Act; the whole package is available for scrutiny. Without much duplication, it should be possible for the House to have the benefit of that. Perhaps the Minister would consider how that could best be done.

The Scotland Office should learn a lesson from the Scottish Parliament and pass such information on to us. That extra information would probably have answered more questions than the Minister provided. The Scottish Parliament seems to have a procedure whereby a whole load of questions on statutory instruments can be put to the Executive and replied to by written answer before orders are approved.

The issue of pensions has been dealt with, although it would helpful if the Minister answered the question that has just been put to him.

On trading, I am slightly intrigued about why the Minister says that the order merely tidies up the situation. Why is it not possible to take account of the trading aspects of the consolidated fund in the operation of the Scottish Parliament? The Minister says that there are no plans to use the order, but it seems strange that the order should be put before the Committee if there are no plans to use it.

4.40 pm

Mr. Peter Atkinson (Hexham): Following what the hon. Member for West Aberdeenshire and Kincardine (Sir R. Smith) said, I always think it is suspicious when people introduce orders and then say that they are not important because they will not be used. We know from the past that there is always some ulterior motive other than tidying up. I might not have understood the Minister, because I do not have the benefit of the full brief, but will he confirm that he said that the Scottish Parliament only has the flexibility to vary payments in relation to the relevant Scottish Parliament commission and in relation to salaries for the Scottish Administration? Is there any scope for the Scottish Parliament to make payments other than outside those two headings?

4.41 pm


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