Devolution: A Decade On - Justice Committee Contents

Memorandum submitted by Professor Michael Keating, Head of Department of Political and Social Science, European University Institute Florence; Professor of Scottish Politics, University of Aberdeen

  This paper is based on work done between 2000 and 2006 on devolution in the United Kingdom. Fuller details are given in:

  Michael Keating, The Government of Scotland, Edinburgh University Press, 2005.

  Michael Keating (ed.), Scottish Social Democracy (Presses interuniversitaires européennes, 2007).

  Michael Keating, "Policy Divergence and Convergence in Scotland under Devolution", Regional Studies Vol. 39.4 (2005), pp 453-463.

  Michael Keating, "Higher Education Policy in Scotland and England after Devolution", Regional and Federal Studies, 14.4 (2005), pp 423-35.

  Michael Keating and Paul Cairney, "A New Elite? Politicians and Civil Servants in Scotland after Devolution", Parliamentary Affairs, 59.1 (2006), pp 1-17.

  Michael Keating and Linda Stevenson, "Rural Policy in Scotland after Devolution", Regional Studies, 40.3 (2006), pp 397-408.

  Paul Cairney and Michael Keating, "Sewel Motions in the Scottish Parliament", Scottish Affairs, 47, Spring (2004), pp 115-34.

  Michael Keating, "From Functional to Political Regionalism. England in Comparative Perspective" in Robert Hazel (ed.), The English Question (Manchester University Press, 2006).


  2.1  There are two English questions:

    (a) the unbalancing of the constitution given devolution in the three other parts of the United Kingdom, including the West Lothian Question. The main problem here is that MPs from devolved territories can vote on English matters but neither they nor English MPs can vote on non-English matters. It is even possible that a government might depend on the votes of non-English MPs but use this majority to legislate for England;

    (b) the internal government of England. This is a matter of the best design for the supralocal level of government and administration given the social and economic needs of the parts of England. Regional government and city-regions have been proposed to address the lack of government at this level.

  These cannot share the same solution. Regional government in England, as proposed in 2004 and related proposals since, would not give the parts of England self-government equivalent to that of Scotland, Wales and Northern Ireland, notably legislative powers. It would not therefore solve the West Lothian Question. There is no demand for legislative powers for sub-national territories in England.

  The two questions must therefore be treated separately. Issue (b) is a matter of administrative and local government reform. Issue (a) is more properly constitutional.

  2.2  The constitution might be rebalanced by establishing an English Parliament and converting the United Kingdom into a federation. There is, however, little demand for an English Parliament and it would leave the UK Parliament with little to do. Westminster would not even be able to operate as a normal federal parliament since such parliaments normally share competences with the constituent units. Already under devolution, the decision has been taken to give Scotland and Northern Ireland almost exclusive control of various competences including health, education and social services. Federalism could thus represent a re-centralization.

  2.3  An alternative is an in-and-out system whereby Scottish and Northern Ireland MPs (and Welsh MPs where and when legislative powers are devolved) would not vote on matters in England which are devolved in their own territories. I do not find the arguments against this convincing. These are:

    (a) that it is impossible to define the territorial extent of a bill. This is in fact done already.

    (b) That bills mix devolved and non-devolved matters. This is an example of bad practice and makes the statute book difficult to read. Governments should separate devolved and UK clauses better.

    (c) That votes on English questions matter to Scotland because English expenditures determine the Barnett allocations to devolved governments. This objection makes a matter of principle out of a flawed and much-criticized system of financial allocation, which does not even have a statutory basis. The UK needs to move to a better system of territorial financing in any case, which would remove this objection.

    (d) That governments would not have a guaranteed majority on English matters. This I find the least convincing argument of all. It suggests that it is right that a party should govern England even when, as at the last election, it has not even gained a plurality of the vote there. This is precisely the sort of anomaly that fuelled support for devolution in Scotland between 1979 and 1997. It also assumes that it is right for governments automatically to get their way on legislation. Constitutional reformers have always found this problematic. With an in-and-out system, governments would have to find majorities among English MPs for their English measures. This would force them to broaden their base, just as parties in the other parts of the UK need to do under proportional representation.

    (e)   If the voting system for Westminster elections is reformed, then governments will need to find broader bases of support in any case.


  3.1  It is a commonplace that intergovernmental relations so far have been rather smooth because the same party has dominated at both levels. With different parties in power, it would not be possible to depend on the same informal understandings and it would be necessary to develop more formal arrangements.

  3.2  Some critics have commented that the UK system is unduly asymmetrical and fragmented. There is a complex mixture of devolved governments and Whitehall departments, many of which are de facto English departments. There is thus a "missing centre".

  3.3  Both these points have substance. This does not, however, imply stronger mechanisms for policy coordination. Nor does it imply building up the "missing centre" or imposing limits to divergence. Given the disparity in size, power and resources between Whitehall and the devolved territories, any such effort could only mean recentralization and Whitehall dominance. The "centre" would in fact be formed by English departments and policy coordination would be on their terms. Devolution is about allowing policy divergence and a healthy competition among governments to innovate and respond to challenges. Experience from other countries shows that coordination mechanisms or framework laws defining the limits of divergence are used as a mechanism for re-centralization. Devolved systems of policy making are still in their infancy and need room to develop freely. Incorporating them back into UK-wide policy systems would undermine the dynamic of devolution. Other federal and devolved systems have recently tended to reform by disentangling responsibilities and encouraging policy autonomy.

  3.4  The need, rather, is for two things. First is a system to highlight when decisions taken in one jurisdiction impinge on the responsibilities of another. Examples might be decisions on tuition fees, or the consequences for attendance allowances of the decision on free personal care for the elderly in Scotland. In this case, a forum should exist for resolving the resulting conflicts. Second is a system for diffusing ideas about innovation from one territory to another. This does not need to be constitutionalized and could operate at various levels, the political, the administrative and the academic.

  3.5  Representation of the devolved territories in the EU is currently at the discretion of the central government. This is in contrast to arrangements in Germany, Belgium, Austria and now Spain. It is true that there can only be one representation of a state in the EU Council of Ministers and that a single line must be taken. It is not necessary that the representative be the central government. More formal arrangements should be made for representing the devolved territories in EU negotiations. There should be guaranteed membership of the UK delegation when devolved matters are being discussed, and corresponding membership in working parties and preparatory meetings. It is likely that consensus can be reached on most issues. If there is a fundamental disagreement, then the UK government line might have to prevail but the devolved territories would be publicly to signal their dissent. This would provide political incentives for all sides to seek agreement.


  There is no need to retain the territorial secretaries of state. They could be replaced by one minister responsible for overall relations with devolved territories.


  The courts have not been used to resolve devolution disputes. Some regard this as healthy and a sign that the devolution settlement is working. It might be argued, on the contrary, that the failure to use the courts has prevented the development of a body of devolution case law. This means that, in the case of serious conflict, the courts would have to invent very quickly. Sewel (legislative consent) motions have been used too often in order to circumvent questions of unclear competence, rather than demarcating the boundaries of devolved and reserved competences more clearly. This, rather than any centralizing effects, is my main criticism of the legislative consent mechanism.


  6.1  The most serious outstanding issue concerns fiscal powers for the devolved bodies. In no other system that I know of is such a high degree of freedom on how money is spent combined with such an absence of power over how it is raised. The lack of responsibility for raising money is a debilitating influence on policy debate within Scotland and Wales and is responsible for much of the perception that Westminster remains the most important influence even over devolved matters. Politics is stuck in a pre-devolution mode of lobbying rather than of creative policy-making. Policy-makers have less incentive to focus on economic growth and reduction in welfare dependency when they do not gain the fiscal benefit from it. Within the devolved governments, there has not developed an adequate system of resource planning and budgeting since the main task has been to distribute funds that have, since 1999, been flowing rather generously. Some of the main decisions to be taken by governments is the balance between taxation and spending; or between taxation and charging. As the debates on free personal care and tuition fees have shown, the devolved governments have very limited scope for altering these balances. As transfers from Westminster become more constrained, this difficulty will only increase, inhibiting diversity in models of service provision.

  6.2  Some parties, notably Labour, and many academics, have insisted that there is no viable alternative to the present system because any form of devolved taxation would be unworkable or would cause economic distortions. This ignores the example of all other federal and devolved systems in the world. Devolving taxes is feasible; what is lacking is the political will.

  6.3  It is likely at some point that the Treasury and English MPs will declare themselves unwilling to take the pain of raising money while the devolved administrations get the credit for spending it. There is now a trend across Europe and North America to devolve fiscal powers to the regions, states and provinces. This has promoted policy innovation and competition.

  6.4  Fiscal devolution should be accompanied by a system of fiscal equalization. It is an illusion to pretend that such a system can be purely technical, since definitions of need and resources involve value judgements. This means that fiscal equalization is difficult, not that it is impossible. Adjustments would have to made incrementally rather than in big steps from one year to the next. Yet the Barnett formula already provides for incremental adjustment. An equalization formula could similarly be brought in and adjusted over time.

20 April 2007

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