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My Bill would give councils the power to refuse applications on prematurity grounds. Local plans and neighbourhood development plans can often take a long while to develop. Developers know that and exploit it. With an increasingly transient population, we should stop focusing simply on local authority areas and having artificial targets set by the local authority—in the case of Leeds, they are wrong—and look at how local authorities can work together, rather than in isolation, to address the country’s housing needs and where we should be building homes.

We need an overhaul of the plans panels process, which is frankly a fig leaf. Plans panels are presented as a quasi-judicial process, but they break every norm of any fair or just process. In Leeds, they allow a lengthy presentation by the developer and then only three minutes for two individuals to speak against. We need a proper process, with an independent chair, that gives equal time to proposers and opponents of significant developments.

We need to do more to prioritise brownfield land, and my Bill would put a specific requirement on developers, as well as local authorities, to prioritise brownfield sites through controlling or phasing the order in which allocated sites become available for development. My Bill would also ensure that councils have the power to refuse applications on greenfield sites until such sites have actually been brought forward for development. Developers are deliberately not bringing such sites forward so that they cannot be considered, and then the developers can use the loophole to get planning permission.

The Government have had the common sense to deal with betting shops, and my Bill would do the same thing to stop the nonsensical conversion of assets of community value to uses that are clearly different, including those suggested by CAMRA. The ACV scheme was a good start, but our communities deserve more than simply a right to try to raise money to make a bid that can then be ignored. My Bill would do what the Localism Act 2011 should have done and bring in a genuine community right to buy. It would also tighten the legislation and guidance so that councils do not unreasonably deny communities the right to list local assets, as has recently and disgracefully happened in Leeds.

Ministers have made considerable improvements to make the planning system simpler and more accessible to the public—and to involve local communities—but they need to go further to achieve their ambitions. We need further reform as soon as possible.

Question put and agreed to.

Ordered,

That Greg Mulholland, Rosie Cooper, Mr Jim Cunningham, Jason McCartney, Stuart Andrew, Philip Davies, Martin Horwood, Chris White, Ian Swales, Mike Thornton and Dr Julian Huppert present the Bill.

Greg Mulholland accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 6 June, and to be printed (Bill 203).

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Section 5 of the European Communities (Amendment) Act 1993

1.47 pm

The Financial Secretary to the Treasury (Nicky Morgan): I beg to move,

That this House approves, for the purposes of Section 5 of the European Communities (Amendment) Act 1993, the Government’s assessment as set out in Budget 2014 and Autumn Statement 2013, combined with the Office for Budget Responsibility’s Economic and Fiscal Outlook (2014) and Fiscal Sustainability Report (2013), which forms the basis of the United Kingdom’s Convergence Programme.

I welcome this opportunity to listen to Members’ views on the information that will be provided to the Commission this year under section 5 of the European Communities (Amendment) Act 1993. As in previous years, the Government will inform the Commission of the UK’s economic and budgetary position in line with our commitments under the European Union’s stability and growth pact. The Government plan to submit their convergence programme today, with the approval of both Houses.

The convergence programme explains the Government’s medium-term fiscal policies, as set out in the 2013 autumn statement.

Mr David Nuttall (Bury North) (Con): I am grateful to my hon. Friend for giving way so early in her speech. As she will know, today is the last day for the convergence programme to be submitted under the economic governance pact. As she said, it requires the approval of both Houses. The other place is not sitting today. Has its approval already been obtained and why have we waited until the last day?

Nicky Morgan: I know that my hon. Friend is an assiduous follower of these matters, and he is right. The other place had a short debate on the convergence programme on 9 April. He will know, and I am learning, about the vagaries of timetabling debates, which have meant that this was the earliest day that we could debate the convergence programme in the House. I am told that in previous years the convergence programme has been sent in draft to the Commission, but we were keen that we should debate and send the final document. The convergence programme document was put before both Houses in a written ministerial statement dated 3 April, and placed in the Libraries on the same date. Members have therefore had an opportunity to consider the draft document since that date, although I appreciate that the recess has intervened.

Kelvin Hopkins (Luton North) (Lab): I have raised this matter before on similar occasions. First, there is constant talk about convergence, but the European Union’s economies have always exhibited divergence, not convergence. Secondly, do we want to converge with an economy that is failing and growing more slowly than we are?

Nicky Morgan: I have read previous debates and know that the hon. Gentleman is assiduous in attending such debates and in following these matters. The language used in titles of various EU programmes is not a matter of choice for this Government. Perhaps a better word

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could be used, but it has not been selected by the Government. I take his remarks on board. I think all of us know that the eurozone has not been as strong as even those of us outside the eurozone would like it to be—it is important for our businesses and our exporters—but I will come on to show that things are looking better. The recovery taking place in the rest of the European Union is slower and it is important that we are fully aware of, and the European Commission fully monitors, the economies of other eurozone countries, even though—let me make it clear again—the Government have no intention of joining the euro.

The convergence programme explains the Government’s medium-term fiscal policies as set out in the 2013 autumn statement and in Budget 2014, and also includes Office for Budget Responsibility forecasts. As such, it is drawn entirely from previously published documents that have been presented to Parliament. With the Budget on 19 March and Easter recess timings as they were, I appreciate, as I have already mentioned, that the timetable for this debate has been particularly tight. Against this backdrop, the Treasury has made every effort to provide early copies of the convergence programme document in advance of today’s debate. The document makes clear that this year’s Budget reinforces the Government’s determination to return the UK to growth, and reiterates the Government’s No. 1 priority: tackling the deficit. As we have already heard in interventions, there are differing views on the value of submitting stability or convergence programmes, especially for the UK, given that the Government have ruled out joining, or preparing to join, the single currency.

The document forms part of the European semester process, which provides a broad framework for the co-ordination of the monitoring and surveillance of member states’ fiscal and economic policies, including necessary structural reforms across the EU. The positive value of the European semester is that it is a useful means to encourage other member states to grip the urgent growth challenge across the EU.

Budget 2014 set out the Government’s assessment of the UK’s medium-term and budgetary position. The UK economy is still recovering from the most damaging financial crisis in generations. We had the biggest bank bail-out in the world, the biggest deficit since the second world war and suffered the deepest recession in modern times. In the face of such a daunting economic challenge, it is essential to have a clear and comprehensive plan.

In 2010, the Government set out clear, credible and specific medium-term consolidation plans to return the public finances to a sustainable path. Our plan makes clear that we will fix the economy and deal with the deficit, cut tax to encourage investment, back businesses, control welfare and invest in skills. We are putting that plan in place. We have adhered to it and we are delivering results with it. The Government’s fiscal strategy has restored fiscal credibility, allowing activist monetary policy and the automatic stabilisers to support the economy and ensure that the burden is shared fairly across society.

Jacob Rees-Mogg (North East Somerset) (Con): I am extremely grateful to the Minister for outlining the excellent economic policy that Her Majesty’s Government have so successfully been following. I wonder whether

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she can give me the assurance that no part of that policy has been changed in any way to meet the requirements of European convergence.

Nicky Morgan: I am certainly not aware of any changes. In fact, I think it would be fair to say that we have led the way in Europe and the eurozone in showing exactly how important it is to return to growth and the actions that need to be taken. It is interesting to see other European countries watching what this country has done and following some of the policies that we have put in place so assiduously. It is, as I have said, very important that they return to growth for the sake of our businesses and exporters, too.

The long-term economic plan has protected the economy through a period of global uncertainty and provided the foundations for the UK’s economic recovery, which is now well established. Since last year, economic growth has exceeded forecasts and has been balanced across the main sectors of the economy. Inflation is below target and the deficit has been reduced year on year. More than 1.5 million private sector jobs have been created. Employment is at record levels and interest rates are near record lows, helping to keep costs down for families and businesses. The Government are also making significant progress in reversing the unprecedented rise in borrowing between 2007-08 and 2009-10. The deficit has been cut by a third, as a percentage of GDP, over three years, and is projected to have fallen by a half, as a percentage of GDP, by 2014-15. The OBR also forecasts public sector net borrowing to reach a small surplus in 2018-19. The independent OBR has judged that the Government remain on track to meet the fiscal mandate one year early.

The Government’s consolidation plans have been central to the reduction in the deficit, with £64 billion of the £80 billion spending reductions in spending review 2010 already implemented. The Government are continuing to take action to improve financial management and spending control. Departments remain ahead of their consolidation targets and are again forecast to underspend by £7 billion in 2013-14. The OBR judges that fiscal consolidation has not had a larger drag on the economy than it expected in June 2010, and the UK’s fiscal vulnerabilities argue strongly in favour of maintaining our commitment to deficit reduction. The OBR forecasts that the underlying structural deficit is falling, but it is falling no faster than previously forecast, despite higher growth.

The persistence of the structural challenge supports the Government’s argument that economic growth alone cannot be relied on to eliminate a structural deficit. As my right hon. Friend the Chancellor has said, the job is not yet done. More work will need to be done to tackle historic weaknesses, including low productivity, poor skills and inadequate infrastructure. The deficit is still one of the highest in the developed world and the UK needs to continue to deal with its debts. We are on the right track. The deficit has already been cut by one third. Budget 2014 is fiscally neutral, despite lower borrowing across the forecast period, with an overall reduction in tax funded by a reduction in spending. We have set out our fiscal consolidation plan and it is vital to stick to it in future years.

Budget 2014 announced that the Government are cutting income taxes and freezing fuel duty to help hard-working people to be more financially secure;

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creating more jobs by backing small business and enterprise with better infrastructure and lower job taxes; capping welfare and controlling immigration, so that the UK economy delivers for people who want to work hard and play by the rules; and delivering the best schools, skills and apprenticeships for our young people. The OBR has revised the UK’s growth forecast upwards and it is now among the highest in the EU.

As the Chancellor said, the job is not yet done and the same is true for the rest of the EU, which is the UK’s most important trading partner. Some 45% of our exports are destined for the EU, and seven of the UK’s top 10 trading partners are EU member states. Without sustainable economic growth, the EU will be unable to repay its debts, create jobs or maintain its standard of living. Much of the answers to these problems lie with national-level reforms, such as creating flexible labour markets. Clearly, the European semester has a key role to play in encouraging member states to make ambitious reform commitments. The UK has an interest in making sure those reforms happen. An ambitious EU-level reform agenda is also a key part of this equation and an essential counterpart to national-level reforms. While I can understand that some may be cautious about encouraging the UK to do more, an EU growth agenda would make a major contribution to growth across the EU as a whole and benefit the UK. Recent European Councils have underscored the strong commitment of Heads of State or Government to supporting growth and competitiveness. I know that the Prime Minister has been driving forward this agenda, along with leaders from a substantial group of like-minded member states.

Some would claim that we cannot have EU economic growth without EU spending growth. I disagree. While some areas of the EU budget, such as spending on innovation and research and development, have the potential to support growth, this in fact represents only 13% of the total EU budget. However, deploying EU-level policies in support of economic growth, such as the single market, regulatory reform and EU-level free trade agreements, can achieve maximum growth impact at the least cost.

Ian Swales (Redcar) (LD): The Minister makes a point about EU spending. Does she join me in welcoming the fact that certain parts of the country have EU transitional status, which causes EU money to flow to areas such as the Tees valley?

Nicky Morgan: My hon. Friend is absolutely right. As we are a part of the EU and contribute, as a country, to the EU budget, it is absolutely right that some of that money comes back to this country—or to particular parts of this country—and we see the benefit of that financial contribution. He mentions his area of the country, and I know that EU funding in the midlands has been particularly valuable in supporting vital work on things such skills and apprenticeships.

Jacob Rees-Mogg: I wonder whether my hon. Friend should be a bit careful about welcoming EU spending in this country because it was our money in the first place and it is not necessarily being spent in the way that Her Majesty’s Government would wish to spend it

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because it has to meet the requirements of the European Union. Therefore there is the risk of getting inefficient spending out of our own net contributions. We risk wasting money and having a bigger deficit by dong this through a third party, rather than through the actions of our own Government.

Nicky Morgan: My hon. Friend is right, and he tempts me down a particular path—to say whether membership of the EU broadly benefits this country. I am sure that we could have a whole debate on that, and I know that he could go on for hours and hours on that particular subject. [Interruption.] We will not do that, Madam Deputy Speaker; I take your guidance. Of course, this Parliament is getting less money because the previous Government gave away at least a percentage, if not half, of our rebate. Over the course of this Parliament, this country will receive about £10 billion less from the EU than we would have done had we stuck to the rebate arrangements agreed by a previous Prime Minister—probably the best part of 30 years ago.

Mr Andrew Turner (Isle of Wight) (Con): Is the Minister aware that this very morning, money was granted to the Isle of Wight and plenty of other parts of the country through the Minister of State, Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks (Michael Fallon). Yet instead of that being done here and now, the money had to go all the way over to Europe for the EU to sort out some mad scheme.

Nicky Morgan: To respond briefly, I entirely understand my hon. Friend’s point. I suspect he will be pleased that the money has come to the Isle of Wight. I take his broader point about the benefits of membership and the amounts of money spent, which could be the subject for a different debate at a different time. In respect of the EU budget, it is also worth remembering that the Prime Minister went to Europe last year to negotiate a smaller future budget contribution over the course of the next seven years, which had never been achieved before. His determination to work with like-minded member states to achieve that is what enabled it to happen. I would have thought that all Members, and particularly Conservative Members, would hugely welcome that.

The need comprehensively to address Europe’s growth challenge, tackling overall low productivity and the lack of economic dynamism and flexibility, is more pressing than ever before, and it is in our interest to make urgent progress. That is why the UK will continue to push this agenda at the highest levels and encourage the new Commission to take structural reform seriously.

To conclude, the Government are committed to ensuring that, in line with section 5 of the European Communities (Amendment) Act 1993, this House approves the economic and budgetary assessment that forms the basis of the convergence programme. Following what I hope will be the House’s approval of that assessment, the Government will submit the convergence programme to the European Commission, which will make its recommendations to all EU member states in early June. These recommendations will then be considered by the ECOFIN Council on 20 June and agreed by Heads of State or Government at the European Council on 26 and 27 June.

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To reiterate, the convergence programme contains no new information, but only information that has been presented previously to Parliament—information from the OBR’s economic and fiscal outlook and from the Budget, which sets out the Government’s strategy to return the UK to sustainable growth. For the reasons I have outlined, I ask the House to support the Government motion and I look forward to hearing the debate.

2.5 pm

Shabana Mahmood (Birmingham, Ladywood) (Lab): I am grateful to the new Financial Secretary to the Treasury for her introduction to the debate, and I congratulate her on her promotion to her new post. I look forward to continuing the debate with her in the Finance Bill Committee, which got off to such a strong start yesterday.

When I first looked at the motion, I was mystified about the nature of the debate, which is why I have thanked the Financial Secretary for her introduction to it. The motion, as framed, does not exactly leap off the Order Paper. When Members go to the Vote Office, as I did to find the convergence documents, they will find that the motion still does not quite leap out at us in respect of what is going on in the House this afternoon. That situation is not a state of affairs that is alien to Members, given that we often have to debate issues that can sometimes seem impenetrable to those on the outside, and often to those on the inside too.

Let us turn to what could be described as “minus page 2” of the Red Book. I thought it quite telling that underneath a note about the Crown copyright and the ISBN number, are the words:

“Printed on paper containing 75% recycled fibre”,

and

“The Budget report, combined with the Office for Budget Responsibility’s Economic and fiscal outlook, constitutes the Government’s assessment under section 5 of the European Communities (Amendment) Act 1993”.

That is relevant to today’s debate, as the Minister helpfully outlined in her introduction. This is in a very small font and is easy to miss, and it is not immediately clear what it really means.

Looking at the 1993 Act, Members will have spotted that it refers to the Maastricht treaty, article 2 of which states:

“The Community shall have as its task...a harmonious and balanced development of economic activities, sustainable and non-inflationary growth”.

Article 103 is relevant, too, as it talks about economic policies being a “matter of common concern” that should be co-ordinated within the Council. For some Members of all parties, these are the sort of words that are difficult to stomach. That article continues:

“For the purpose of this multilateral surveillance, Member States shall forward information to the Commission about important measures taken by them in the field of their economic policy”.

Once we break through the rather impenetrable language and the odd nature of this old treaty obligation, the emphasis of which has changed from when the obligation was made to the state of play within the EU today, what we get to is the fact that the House is essentially being asked to approve the Budget Red Book as a true and accurate reflection of what is happening in the UK economy. When we are finally able to frame the question

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in that way—asking whether the Red Book is in and of itself a true and accurate reflection of that—I would have to say, “Where shall I start?” It will probably not surprise Government Members to know that the Opposition do not consider it a true and accurate reflection of what is happening in the UK economy

Let me start with the top line of page 4 of the Red Book:

“The government’s long-term economic plan is underpinned by its commitment to fairness.”

I seem to remember that during the run-up to the last general election, before the Government began their life in the current Parliament, the right hon. Member for Tatton (Mr Osborne), who was to become Chancellor of the Exchequer, uttered his famous line about how they were not going to balance the books on the backs of the poor. There was also that other famous line about how we were all in it together. On the face of it, who could say that those sentiments were wrong? Certainly, if they had proved to be genuine, we should be in a very different place.

At the heart of those lines of rhetoric, however, is the implication of a deep commitment to fairness. My charge against the Government is that that commitment—and the “commitment to fairness” to which the Red Book refers—can only be seen as genuine if we accept that “fairness” can describe an economic plan that gives a huge tax cut to the wealthiest in our country. In the 2012 Budget, the Government announced a tax cut for millionaires that would be worth an average of £100,000 to each of them—a sum that is far out of the reach of millions of people in our country today. Meanwhile, the Government are presiding over what might be termed one of our more successful growth industries, which, unfortunately, happens to be the food bank industry. The number of people receiving three days of emergency food has grown from 67,000 four years ago to 913,000. How can it possibly be true that, as the Red Book states, the Government have a deep “commitment to fairness”, when the richest members of our society receive a huge tax cut while the poorest, in ever growing numbers, are being forced to use food banks?

Ian Swales: Perhaps the shadow Minister will quote another statement in the Red Book, namely the statement that net income inequality is at its lowest since 1986. The period following that year has included 13 years of her party in government.

Shabana Mahmood: Later in my speech, I shall deal directly with issues relating to household income and what is happening to the ability of families on low and middle incomes to make ends meet.

Mr Simon Burns (Chelmsford) (Con): The hon. Lady has been making a big point about fairness. Would it not be fair to point out that, since coming to power, the Government have considerably increased the personal allowance—from just under £7,000 a year to £10,000—and that that has helped the poorest who are in work and paying taxes, as well as middle-income families?

Shabana Mahmood: I shall deal with precisely what has happened to the personal allowance later in my speech, but let me make this point to the right hon. Gentleman now. It is true that the personal allowance

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has risen, and the Opposition have supported those changes, including yesterday when we debated clause 2 of the Finance Bill in Committee. However, it is also true that ordinary working people continue to be worse off despite the changes, and will still be worse off in 2015 than they were in 2010. This is a classic case of the Government’s giving with one hand and taking away much more with the other, and it goes to the heart of the “fairness” charge that I am laying at their door.

I was very struck by the suggestion made by a welfare Minister, Lord Freud, that the reason for the massive increase in the number of people who are using food banks and having to rely on food parcels from them was that

“there is an almost infinite demand for a free good.”—[Official Report, House of Lords, 2 July 2013; Vol. 746, c. 1072.]

I had to read that comment several times, because I could not quite believe that such words could emerge from anyone’s mouth during a discussion about food poverty and the fact that people are going hungry in our country. When the story about the huge increase in the number of people using food banks hit the news a couple of weeks ago, I was also struck by the main attack line from those on the Government Benches: the claim that the increase had a lot to do with advertising and the fact that many more people are now aware of food banks.

Madam Deputy Speaker (Mrs Eleanor Laing): Order. The hon. Lady will be aware that this is a very narrow motion. I am sure that she is using the matter to which she is referring as an example, which is in order, but I expect that she will be very careful not to stray too far from the very narrow terms of the motion.

Shabana Mahmood: I will, of course, be careful, Madam Deputy Speaker. However, the point that I am making relates directly to what is in the Red Book, to the nature of the motion that we are being asked to support, and to whether we are being presented with a true and accurate reflection of what is happening in the United Kingdom economy. My view, and that of other Opposition Members, is that the Red Book implies that the “commitment to fairness” is being met. I do not believe that a situation in the United Kingdom economy in which more and more people are being forced to use food banks while the Government see fit to give a tax cut to the wealthiest in our country indicates a genuine commitment to fairness, and it is for that reason that I have rejected the thrust of the motion—which asks us to approve the Red Book as such an accurate reflection—and supported the amendment.

The Red Book paints a rosy picture of the goals that have been met and the targets that have been delivered, but, although I looked very carefully, I could not find any reference to the Government’s failure to meet the terms that they had set themselves for their so-called long-term economic plan. The Minister said earlier that the Government were “on track”, which is fair enough, but the track to which she referred is not the track that the right hon. Member for Tatton said that we would be on when he became Chancellor. At the beginning of this Parliament, the Government said that the deficit would be eliminated by 2015, but we now know that that is not the track they are on. The deficit will not be

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eliminated by 2015; indeed, the current forecast is that it will not be eliminated until 2017-18, when we shall be well into the next Parliament. That is not the test that the Government set themselves for their economic plan, which has failed on its own terms.

Mr Andrew Turner: Does the hon. Lady agree that one of the problems was Europe, and the fact that its the budget burst into flames in 2011 or 2012?

Shabana Mahmood: What we are being asked to do today is approve a document on the basis that it is an accurate reflection of what is happening in the UK economy. I am afraid that the document does not accept the fact that the Government are not on track to meet the challenge that they set themselves, and promised the electorate that they would deliver on at the last election. They suggested that, if the Chancellor’s programme of fiscal consolidation was pursued—which it was—the budget deficit would be eliminated by the end of this Parliament, and the fact that that is not going to happen goes to the heart of the motion.

However, the Government are not just off track in relation to the central promise that they made to the electorate at the beginning of this Parliament about the elimination of the deficit. The national debt is rising, and the Government are set not to meet their target of ensuring that it falls as a share of GDP by 2015-16, although anyone reading the Red Book in isolation would be forgiven for thinking that everything was going exactly according to their original plan.

Jacob Rees-Mogg: I am enjoying a good deal of the hon. Lady’s speech, but she ignores the crucial point: the Office for National Statistics substantially revised downwards the economic growth in 2008 and 2009, so the origins of this problem lie with the previous socialist Government, who ruined the economy. Blaming it on the marvellous work of this Government is entirely false.

Shabana Mahmood: I am grateful to the hon. Gentleman for his intervention, but he will not be surprised to learn that I wholly reject the point he makes. Government Members often try to lay the whole cause of the global financial crisis at the door of the previous Labour Government, but it was a global financial crisis that affected countries all over the world; the Labour Government were not responsible for the fall of Lehman Brothers in the United States. That is the first point I would make in response to him. The second point is that this Government have now been in power for four years and they cannot keep trying to get off the hook about their own record. The important point is that they set a target for themselves. Previous Red Books show what was supposed to happen with this programme of fiscal consolidation, but it has not proceeded at the pace the Government set for themselves. That is not spelt out clearly in the Red Book in open language that anybody could understand.

Anyone looking at the Red Book would be forgiven for thinking that these are halcyon days and everything is exactly as it was always planned to be, but that is not a true and accurate reflection of what is happening in the economy. On page 1 of the Red Book, in a section from which the Minister quoted, we see that

“GDP growth has exceeded forecasts”.

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It also states that

“the deficit as a share of GDP is forecast to have fallen by a half by 2014-15 compared to 2009-10”.

Again, that implies, “Everything is okay. Move along. There is nothing to see here.”

Yesterday’s growth figures and the 0.8% growth we have seen in the first quarter are welcome, but they do not make up for the previous three years of flatlining in the economy. We have to remember that in quarter 2 of 2010, growth was at 1.2%, and in 2010 after coming into power the Chancellor said that the economy would have grown by 8.4% by now, whereas in fact it has grown by just 3.8%, which is less than half of what he forecast. Again, what has happened is not quite as rosy when compared with what was supposed to happen in terms of the challenge the Chancellor set himself. It is also not as rosy a picture as is painted in the Red Book.

Let me deal with the point about personal allowances raised by the right hon. Member for Chelmsford (Mr Burns). We see a similar flannelling about what is really going on in the economy when we look at the impact of tax and benefit changes on people on lower and middle incomes and, in particular, on the interplay with their living standards. The Red Book tells us that

“a typical basic rate taxpayer will pay £705 less income tax…in cash terms than they would have paid in 2010-11.”

Page 10 of the Red Book tells us that pressures on household budgets “have eased”, but that is simply not the experience of millions of people on lower and middle incomes in our country. I fail to see how that statement can be true at the same time as the OBR tells us that wages will be 5.6% down in 2015 compared with 2010.

Treasury Ministers have failed to admit that latter point; they have been asked a number of times to accept that the OBR has said that wages will be 5.6% down, but no Treasury Minister has ever answered yes or no to that question. I will happily give way to the Financial Secretary if she wants to confirm that that is the case, but she is looking at her papers and I think she is going to do what every other Treasury Minister and colleague of hers has done, which is duck the opportunity to confirm on the Floor of the House and for the benefit of the record that the OBR is right in saying that wages will be 5.6% down in 2015 on the 2010 level.

Ian Swales: I am listening to the hon. Lady’s arguments. Would she like to add that because the income tax cut is a flat-rate amount it has the biggest impact on the low-paid and that the low-paid, particularly those on the minimum wage, have had a real-terms increase in their net pay?

Shabana Mahmood: And yet people in our country are on average £1,600 a year worse off. Let us look at the combined impact of tax and benefit changes. The Institute for Fiscal Studies figures, analysed for us by the House of Commons Library, show that on average people will by next year be about £1,000 a year worse off. This comes back to the central point: the Government say in the Red Book that pressures on household budgets are easing, but people are worse off, and not by trifling amounts, such as a tenner or £20 quid—they are worse off by nearly £1,000. That is a huge sum and it has a huge impact on a family’s ability to make ends meet.

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The Government talk a lot about the personal allowance, and when the charge is made that ordinary people are suffering a deep-seated cost of living crisis, they often say, “But of course we have taken a large number of people out of tax altogether because of the increase in the personal allowance.” Although the personal allowance increases have been welcomed and supported by everybody across the House, they do not in and of themselves give a family the ability to make ends meet. We still have people who are desperately struggling, and who have their head in their hands every time a bill comes through the door. The truth remains that people on lower and middle incomes are worse off, and they will be worse off at the end of this Parliament than they were at the beginning of it. The balm offered, by the increases in the personal allowance in particular, is not enough to heal the deep wound that has been inflicted by all the other changes this Government have implemented since they have been in power. As I say, the combined impact of tax and benefit changes means that by next year people on lower and middle incomes will be about £1,000 a year worse off.

The Red Book also talks a lot about the Government’s economic policy in relation to savers. The Chancellor famously said:

“If you are a maker, a doer or a saver, this Budget is for you.”—[Official Report, 19 March 2014; Vol. 577, c. 781.]

There was not much in the Budget and the Red Book to help those who are making do—the people struggling with the cost of living crisis. But for the savers, there is much in the Red Book: about retirement choices, individual savings accounts and other savings devices. The Red Book has twice as much about savers as about supporting households. Again, however, it is not a true and accurate reflection of what is going on in the economy, because the Red Book fails to recognise that for many people saving, particularly at the moment, is a luxury that is desperately out of reach. I can imagine the welfare Minister I described earlier as being baffled about why people go to food banks being equally baffled about why people cannot save. People go to food banks because they have no money and they are going hungry. People do not save because they do not have any money left once they have met their other costs of living.

Hidden away in the documents that accompanied the Budget we found that the OBR says that the savings ratio has fallen in recent months and is projected to fall every year until 2018. I put that point to the Chancellor yesterday when I asked him to confirm that, despite his Budget for savers, the savings ratio is forecast to go down. He ducked the question and refused to accept that that is what the OBR is saying is happening to the savings ratio.

In recent weeks, we have had a number of surveys, particularly an important one carried out by the Money Advice Service, which have shown that 16 million British people are living life on the edge with no savings at all. Just 27% of people say that they can save on a monthly basis, and 37% say they have fewer savings now than they had last year. The truth, which we do not see in the Red Book, is that savers withdrew money from their accounts last year at the fastest rate for nearly four decades, according to Bank of England figures. Britons ended up taking out £23 billion from long-term savings in 2015. The ability of ordinary people on lower and middle incomes to save and to have enough money left

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over after the working week to put aside even £1 a day is fairly limited. Again, that is something that has not been spelt out in the Red Book.

Mr Philip Hollobone (Kettering) (Con): It has certainly been spelt out in the convergence document produced by Her Majesty’s Treasury. Page 12 makes it quite clear that falls in the rate of saving are to be expected in periods when confidence is increasing. It goes on to say that total household debt as a percentage of disposable income has fallen more than 30 percentage points since its pre-crisis peak under the previous Government.

Shabana Mahmood: I am afraid that that does not get the Government off the hook when it comes to the impact of their own record. The decisions that the Government have made, both in this and previous Budgets, have left ordinary people worse off. The rhetoric around savers and how much there is in the Red Book for savers in our country misses the point and does not spell it out in ordinary language for the ordinary person to understand that saving is a luxury today for millions of people struggling with a deep-seated cost of living crisis.

The Red Book gives a rosy picture of what is happening in the UK economy, but is just a good line in rhetoric that is rather removed from the reality of daily life for millions of people in our country. For that reason, I urge Members to reject the Government motion and to support our amendment, which, at the very least, introduces an element of reality into what is a surreal characterisation of today’s British economy.

2.32 pm

Jacob Rees-Mogg (North East Somerset) (Con): I welcome my hon. Friend the Member for Loughborough (Nicky Morgan) to her new post as Financial Secretary. It is an enormous pleasure to see her there and one of the great outcomes of the recent reshuffle. I also thank her for her courtesy to this House, which has not always been achieved by her predecessors, for holding this debate before the documents have been given to Brussels, which is an improvement. There was no suggestion on this occasion that the matter be debated in a Committee; it has come straight to the Floor of the House. I am grateful for that as it is important that this House has the ability to discuss such matters properly.

I apologise for the other members of the European Scrutiny Committee, who are meeting at this time. My hon. Friend the Member for Stone (Mr Cash), the Chairman of that Committee, can achieve many things, but unlike Padre Pio, that noted saint, he is unable to manage bilocation. No doubt, in a few years’ time, he will be able to achieve the ability to be in two places at once.

Mr Hollobone: Does my hon. Friend think that it is slightly cheeky or that it is just a matter of coincidence that the timetabling for this measure before the House should coincide exactly with when the European Scrutiny Committee is sitting?

Jacob Rees-Mogg: I think that it is an unfortunate concurrence of atoms. If we had not had a statement earlier, it would have been possible to fit in both, and

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that is how things go at the end of a Session. I am not so cynical as to think that this could possibly have been planned.

I want to answer immediately the point about savings made by the hon. Member for Birmingham, Ladywood (Shabana Mahmood). In all that she said on savings, she missed the reclassification of savings that the Office for National Statistics has just introduced. It has roughly doubled our savings rate, because it has reclassified the amounts that private companies put into pension funds as saving rather than as expenditure. That has transformed our savings rate, and therefore the UK economy has had a much higher savings rate than the figures have captured for many years. We should be rather pleased with the savings rate that we have and that we continue to have. Her point on savings, therefore, is, regrettably, fundamentally misfounded.

I want to come on to what underlies this whole debate. People with long memories will be aware that the Government—the British nation—had an opt-out of only stage 3 of monetary union. They did not have an opt-out from the earlier stages, and that included the convergence criteria to be ready to join the euro should that be the wish of the British people at any stage. These documents are part of the convergence criteria to show that we are making headway towards the requirements set out by the European Union under a number of agreements, the latest of which was in 2011, which basically ask for a deficit to be no more than 3% and for the national debt to be no more than 60%. It is about meeting those convergence criteria so that we could if we wished join the euro. It is important to bear that in mind. I am glad about the way the Government have approached this. Had they decided to prepare a whole new set of papers, devoting a great deal of energy and resources on the matter, as the previous Government did with their eurozone entry team, which cost millions of pounds and went on running for years, they would be buying into stages 1 and 2 of convergence for entering the euro. By simply sending the rather splendidly recycled—not just 75% but 100% of the fibre in this document has been recycled—to the European Union, it shows our deep suspicion of the whole process. In the reading of the documents, I could find only two references to performance against EU targets and convergence: on page 22, which runs to a mere three lines, and in the chapter headed “Excessive deficit procedure” on page 53.

I am pleased that the Government are taking an approach of saying, “This is what we understand is happening with the British economy. You, the European Commission, can have it, look at it and chew it over, but we are not running our economic policy in accordance with the convergence criteria.” I was reassured by the Minister’s comments that our policy is not determined by the requirements of convergence, and thank heavens for that. The convergence criteria have been at the heart of the ruination of European economies. There has been one crucial thing that the Government have been able to do since 2010, which the previous Government started, and that is to run a loose monetary policy with a tight fiscal policy. That has ensured that we have been able to get the deficit down without crunching the economy to pieces and without running the risk of a deflationary and elongated depression. That is possible only because we have not been aiming to meet the convergence criteria in the midst of a credit crunch/

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depression. We have been able to set our own policy because we have had our own currency and therefore have not been trying to maintain the exchange rate at any particular level. It is notable that, throughout this process, the exchange rate has acted as one of the crucial automatic stabilisers for the economy. In 2009, the sterling-dollar rate bottomed at $1.35 and is now above $1.65, and that has acted as an automatic stabiliser on monetary policy during the process of this downturn—all of which has been dependent on our having our own currency, and has allowed both this Government and the previous one to be tighter on the fiscal side than would otherwise have been possible. It has avoided the absolute disaster affecting the eurozone countries, of having a tight monetary policy and a tight fiscal policy at the same point, which has led, in some countries, to riots.

I am broadly reassured, but there are inevitably some concerns. As I have mentioned, this is about meeting the convergence criteria that allow us to enter the euro. The European Union has no specific enforcement powers, but there are certain commitments that we have made. We are obliged, as are other EU member states not in the euro, to submit a convergence programme focused on the national fiscal policy. From 2011, EU legislation on economic governance introduced a new obligation on member states, including the United Kingdom, to take due account of EU guidance issued to them in the development of their economic, employment and budgetary policies before taking key decisions on their national budgets for the succeeding years, and progress will be monitored by the Commission.

Ian Swales: I thank the hon. Gentleman for giving way, and he is making a characteristically interesting speech. Presumably one of the enforcement options open to the EU if we do not meet the criteria is not to allow us to join the euro. Will he enlighten us on whether, through his studies, he has come across any other enforcement procedures that might be brought into play if we do not meet the convergence criteria?

Jacob Rees-Mogg: It is always difficult to know what action can be taken until action has been taken and until the European Court of Justice has adjudicated on whether that action is legitimate. Obviously, the hon. Gentleman’s point that we could be prevented from joining the euro is brilliant and I am impressed that the Liberal Democrats are so keen to prevent us from joining the euro that they would like legal action to be brought by the European Union to prevent that.

My warning is not so much that I can see a specific threat coming down the track, as the hon. Member for Birmingham, Ladywood said. There were a lot of tracks in the hon. Lady’s speech, and I wondered whether she was confused with Monday’s debate about the Government’s production of a lot of extra track in one direction or another. There is always a problem if Governments commit themselves to things that they have no intention of doing. At some later date a body comes back and says, “Actually, you agreed in 2011 that the European Commission would have the right to challenge you on how you were developing your fiscal and employment policies. That is not being done, so we want you to put your house in order.” Then we reach the question of what action can be taken to enforce that.

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It is worth concluding on the glorious issue of convergence simply by saying that we are so lucky that we are not converging and that the Government have managed to make policy in this country so much more successfully than our continental friends. For example, the EUROSTAT figures—I shall cite a European body, not because I want to but for the sake of consistency, as similar figures are used across the areas covered—show that in 2013 the UK economy grew by 1.7% against 0.1% growth in the EU as a whole and 0.4% contraction in the eurozone. According to our own figures from the Office for National Statistics, we are now, according to the quarterly figures, growing almost as fast as China at an annualised rate, which is very encouraging. I never thought, even with my confidence in the Chancellor and his team in the Treasury, that we would manage to achieve near-Chinese rates of growth under this Government—emerging-market levels. We also have much lower unemployment than our continental cousins, and that applies not just to adult unemployment but, most importantly, to youth unemployment.

Let us hope that we do not converge but continue to diverge from the failures that the eurozone has inflicted on itself, to maintain our independent economic policy, to have an economic policy that thrives and succeeds because Her Majesty’s Government know what they are doing, unlike their predecessor, and can therefore boldly and with confidence send these statements to the European Commission and say to Señor Barroso and all the rest of them, “If only you had the sense to do what my right hon. Friend the Chancellor of the Exchequer is doing, you, too, might grow as well.”

2.43 pm

Graham Stringer (Blackley and Broughton) (Lab): It is always a pleasure to follow the hon. Member for North East Somerset (Jacob Rees-Mogg) in a debate on Europe. I tend to agree with his analysis of and almost everything he says on Europe, but, fortunately, I do not agree with his analysis of the British economy. It gives me an almost unique pleasure to be able to vote with my own party on a European resolution, which I have not done for some time, and I was surprised and pleased when the Opposition tabled the amendment.

First, it is also not unique for a Minister to come to this Chamber with almost nothing new to say, but it is unusual, to say the least, for the Minister to explain to the House that she has nothing new to say. There is a reason for that. The House is expected to report on the Budget and what we are doing financially to the European Union. In one sense one might take the rise out of that and have a little joke about it, as we are just sending the documents that we have already produced to the European Union and to Brussels, but we must remember that the European Union is a thin-end-of- the-wedge organisation. If it cannot get what it wants immediately, it will concede a little. It will say that as it cannot control our budgets, which it would like to do as it wants to create a much more centralised European Union, we should send it the details of them. Initially, that happened under the guise of looking for convergence since the euro was created just over 10 years ago. For a House that believes and should believe in its sovereignty, there is danger in that process even if nothing is being added to what is being given to the European Union.

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My second point is the obverse of the point made by the hon. Member for North East Somerset. We certainly do not want to converge with the European Union, because the euro has been the biggest machine for destroying jobs in Europe since the 1930s. It has been a complete and total disaster. It is not just a matter of our not wanting to converge with the euro and the rest of the European Union. There is still an insistence within the eurozone on convergence and trying to converge is a disaster for the countries inside the zone and for the United Kingdom, because we want to trade with a thriving economy. While the euro is there, that economy cannot thrive. It is as simple as this. In Germany, the euro is simply an undervalued Deutschmark that is helping the German economy to trade around the world. That is hugely successful and Germany is building up huge trade surpluses. The rest of the eurozone, particularly the Mediterranean regions, is dealing with an overvalued euro that is depressing its economies.

Without the ability to change exchange rates, those countries are effectively in a competitive deflationary situation and it is very unlikely that they will ever be able to pay off their deficits and get into a better economic situation. The only way they could do that is if the German surplus was taken and spent in Portugal, Spain, Italy and Greece, where they have huge unemployment rates and where there is unemployment in what industry is left. It is very difficult—almost impossible—for the eurozone to converge, and that is bad for those countries and, because we want to trade with them, for this economy.

If the eurozone had done better since the banking crisis five or six years ago, this country would not have suffered as much as we have.

Ian Swales: I am carefully following the hon. Gentleman’s argument, with which I absolutely agree. I must admit that since I first became a candidate for the Liberal Democrats, the policy on the euro was the one policy on which I disagreed with my party for exactly the reasons that he is outlining. However, to be positive, does he agree that sending these documents to the EU might, in the spirit of learning, make it reconsider the errors of its ways?

Graham Stringer: The EU is not only a thin-end-of-the-wedge organisation but absolutely not a learning organisation. It is ideologically committed to ever-greater and closer union. It will not listen to arguments, however sensible they are, and however well this economy has or has not done over the past five or 10 years, and it will not take empirical lessons because its ideology is different from that. I will not repeat my previous points about starting the process of this sovereign Parliament’s reporting to the EU.

Mr Hollobone: I am listening to the hon. Gentleman with great interest, and he has evident expertise in matters European. Does he share my concern that one of the problems with our so-called convergence with Europe is the impact on our trade deficit with Europe, which, I understand, is large and growing? That might well be partly a consequence of the tremendous economic recovery in this country and competitive devaluation in Germany, but, given that we are meant to talk about convergence today, my concern is about the growing deficit in trade with our European partners.

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Graham Stringer: Yes. The hon. Gentleman makes a pertinent point.

I had finished what I wanted to say about the EU, the eurozone and the process. I just want to make three quick points about the Minister’s statement and the points raised earlier in the debate. First, the Minister said that the Prime Minister had achieved a reduction in the European budget. If my memory is correct, the Prime Minister negotiated a reduction in an increased budget but with actually increased expenditure in European budgets. I should be grateful if the Minister checked and corrected that fault.

Secondly, to re-emphasise the points that a number of hon. Members made in their interventions on the Minister, this country would be a lot better off if we did not make our contribution to the European budget. On every project, we put twice as much money in as we get back. I might one day promote a private Member’s Bill to say that as an alternative to having the 12 EU stars on projects and saying, “What a wonderful project it is!” there should be a sign that says, “We could have had two of these projects if we had not contributed to the EU.”

Finally, I should be grateful if the Minister told the House how she intends to protect the rights of the House to decide on taxation if the European Court of Justice decides later that it wants to impose a trading tax on the City—a Tobin-type tax, 90% of which would be paid in this country and not in the rest of Europe.

2.52 pm

Mr David Nuttall (Bury North) (Con): It is a pleasure, as always, to follow my near neighbour from Greater Manchester, the hon. Member for Blackley and Broughton (Graham Stringer). As he and the House are aware, I agree with him on the issue of our membership of the European Union.

I want to bring the debate back to the motion, which states specifically:

“That this House approves, for the purposes of Section 5 of the European Communities (Amendment) Act 1993, the Government’s assessment”—

and so on. I will not read out the whole motion. It is purely for the purposes of complying with section 5 that we are being asked to approve the motion today—purely to comply with our obligations under European Union rules and regulations. I oppose the motion for that reason, as I have in previous years. I oppose it, but not because I oppose the Government’s financial policies—indeed, barely a week goes by without further evidence to prove that the policies are working. We could debate, as we have earlier this afternoon, whether things are going fast enough, and whether they are going as quickly as someone previously predicted, but I think all that is irrelevant. What is relevant is the fact that the economy, by any stretch of the imagination, is growing. Things are going in the right direction.

I welcome the fact that we have the opportunity to say that, but I regret the fact that we are having to do it in the context of submitting documents to the European Union. As has been said, this is the very last day for submission of the documents. I am not sure what would happen if—as I very much doubt would be the case—the House refused to support the Government’s motion. I will be voting against it and I would be interested to know what would happen. In last year’s debate, my

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hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) mentioned that if the EU does not agree that we are carrying out the policies to its satisfaction, it can send a surveillance mission to the country, or even an enhanced surveillance mission. If so, I am sure that we would have great delight in meeting them, because they have a lot to learn from what this country is doing.

I do not agree that we, as a sovereign nation, should have to submit our economic policies to the bureaucrats in Brussels like some naughty schoolboy having to report to the headmaster with school work. There is no reason why we should have to go through this annual charade. It is an annual occasion when we have to approve, purely for the purposes of section 5, these documents. I see no reason why we cannot tag the motion on to the end of the Budget motions, for example, if we want to comply with this ridiculous law.

Jacob Rees-Mogg: For once, I disagree with my hon. Friend. I think it is of immeasurable importance that this debate remain a specific debate on the Floor of the House, because there may come a time when the House wants to refuse to report to Brussels and we need to preserve that right.

Mr Nuttall: I entirely agree on that point with my hon. Friend. If I had my way, we would disagree with Europe quite a bit more often than we do. I oppose the motion for that reason and no other, because I do not think we should send these documents to Europe. As I have said in previous years, and will probably repeat later in my speech, if the European officials are so interested in our documents, they are all available online. There is no reason why we need to produce this document.

For all that has been said about the fact that we have not spent any time on this subject, we do have before us a new document entitled “2013-14 Convergence Programme for the United Kingdom.” It is 247 pages long—slightly larger than last year’s document. It has been produced by Her Majesty’s Treasury specifically for this purpose and no other. So somewhere along the line the requirement to produce the document is costing the British taxpayer money.

We must be clear that the sole reason why the UK is making this submission—I quote from the treaty on the functioning of the European Union—is:

“In order to ensure closer coordination of economic policies and sustained convergence of the economic performances of the Member States”.

Why does the treaty require that? Simply because it is all part of their grand plan to forge together a single country called the European Union. That is what they want to see. That is why they want to have these documents sent in to them.

We are fortunate in this country that the UK electorate—the British people—had the good sense at the last general election to elect a Conservative-led Government with a Conservative Chancellor of the Exchequer, who was prepared to take the difficult decisions necessary to put our country back on the path of economic recovery, which means living within our means.

It is instructive to compare the progress that we have made, and continue to make, with that of the European Union. As my hon. Friend the Member for North East Somerset mentioned, the European Union’s own official statistics body—interestingly named EUROSTAT—

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reported that the United Kingdom economy grew by 1.7% last year, compared with a minuscule 0.1% in the rest of the European Union. Even worse, there was a 0.4% contraction in the economies of the countries within the eurozone. And even that performance figure is flattered by the fact that it includes the figures for Germany and France, whose economies, EUROSTAT reported, grew by 0.4% and 0.1% respectively.

The situation is the same for the respective unemployment rates. EUROSTAT reports that the unemployment rate for the European Union as a whole was 10.8% last year, and the latest figures show that unemployment in the UK for the three months to February was 6.9%. That is reflected in my constituency. The latest figures show that in Bury, Ramsbottom and Tottington there are 451 fewer unemployed people than there were a year ago, which means 451 more families have the security of a regular wage coming in each week. More new businesses are being started, business confidence is growing and all the signs indicate that the plan is working and we are on the road to recovery.

The rest of Europe ought to be looking at what the UK is doing and working out how they can adopt our Government’s policies and increase their growth rates. As the hon. Member for Blackley and Broughton said, we want our European neighbours’ economies to grow, because they are important trading nations, as I never fail to accept. The fact that I want us to leave the European Union does not mean that I do not want us to trade with it; I just do not think that we should have to pay a net contribution of £9 billion to have the privilege of doing so. It is simply unnecessary, because we trade with many other countries around the world without having to pay a membership fee to enable us to do so. Therefore, I do not believe that submitting a 247-page convergence programme document is necessary.

In conclusion, let me put two simple questions to my hon. Friend the Member for Loughborough (Nicky Morgan), whom I warmly welcome to her new role as Financial Secretary to the Treasury. First, what response has the Government received from the European Union on last year’s submission? Did we receive any acknowledgement from the bureaucrats in Brussels? Did they tell us that we were doing a good job and that they would use our document as a model for economic success? Did they say that they would encourage our partners to accept some of the policies set out in our convergence programme document?

Secondly, and perhaps more importantly—in view of the Prime Minister’s declared aim of putting an end to the commitment, which we are presently signed up to, to ever-closer union with the rest of Europe—will my hon. Friend confirm that, as part of any renegotiation of the United Kingdom’s obligations to the rest of Europe, the obligation to submit this annual convergence programme document will be removed? Does she agree that not removing that obligation will be seen as clear proof that those renegotiations have failed?

3.3 pm

Nicky Morgan: I thank all hon. Members who have contributed to this extremely interesting debate. I will deal briefly with some of the points that have been raised. I hope to address all of them, but if I do not I will obviously be happy to discuss them afterwards and to try to answer any further questions.

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I thank the shadow Minister for welcoming me to my new post. She is absolutely right that we will be seeing a lot of each other over the next few weeks as we deliberate the Finance Bill upstairs in the Committee Room. What I think was most interesting about her speech was that, rather like the Leader of the Opposition’s response to the Budget statement, it did not mention the EU very much at all. She went through the Opposition’s views on the Government’s economic policy, but I must say that I did not detect any signs of their own economic policy, which appears to be missing. That was interesting, given that the hon. Member for Blackley and Broughton (Graham Stringer) did mention the EU—I will mention his speech in a moment.

It is extraordinary that the Opposition, having previously claimed that there would be no recovery, that any recovery would be choked off and that we would have 1 million more unemployed people, are now saying that the recovery is too slow. No doubt they will move on to another form of criticism in due course. However, I am pleased that the hon. Lady did at least welcome yesterday’s figures on GDP growth, which are significant. As I said in my opening remarks, they show that the economy is growing and that we have momentum, but the job is not yet done.

Mr Hollobone: My hon. Friend is being far too modest —hiding her lamp under a bushel—because her own publication clearly states:

“Since early 2010, the pace of net employment creation has been 3 times as fast as over the same period in previous recessions and recoveries”

since 1973.

Nicky Morgan: I thank my hon. Friend for reading the document assiduously and quoting from it. Yesterday’s figures are a positive step, and the employment figures are very encouraging. As we know from the note left by the last Chief Secretary to the Treasury under the previous Government, there was no money left, because they had spent it all. This Government have had quite a task to rebalance our economy and fix the deficit.

The shadow Minister mentioned the Budget’s focus on savers. Let me tell her that millions of basic rate taxpayers are savers, because she somehow dismissed them by saying that we are not talking about households. I do not know where she thinks savers live, but they form their own households. As my right hon. Friend the Chancellor said, we are on the side of savers and hard-working people of all types. She also mentioned the savings ratio. The latest OBR forecast shows that the savings ratio will be around 4% over the next two years, which is still well above the pre-recession low of 0.2%. I honestly do not know how she has the nerve to criticise the ratio when people are still saving more in this country.

Let me move on to the characteristically eloquent speech from my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg), which showed his expert understanding. I was delighted not only that he could be here for the debate, but that he supports the Government’s approach. I have taken his comments on board, but I am glad that he can support the announcements my right hon. Friend the Chancellor made on recent fiscal events and this document. That is very important.

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The hon. Member for Blackley and Broughton set out his unhappiness with the process. I understand what he was saying. He also mentioned the impact of the eurozone crisis on our economy over the past few years, which was important, and I am glad that he did so. He asked two specific questions. On the multi-annual financial framework, the Prime Minister agreed a real-terms cut in the payment ceiling to €908.4 billion, which is €80 billion lower than the Commission’s original proposal, €35 billion lower than the 2007-2013 multi-annual financial framework and €24 billion below a real-terms freeze on the last completed budget in 2012. That is why I could make my remarks about the Prime Minister’s achievements in negotiating a real-terms cut in the multi-annual financial framework.

The hon. Gentleman also mentioned the financial transaction tax, and we have heard the news today from the European Court of Justice. Let me set out that the UK will not be joining the enhanced co-operation financial transaction tax. Today’s judgment confirmed that the UK can challenge the final proposal for a financial transaction tax if it is not in our national interest and undermines the integrity of the single market. Today’s announcement also confirms that the UK can challenge the eventual implementation if necessary without running the risk of the challenge being too late. We needed to make an early challenge in order to set out our stall for later negotiations for a financial transaction tax should they prove to be disadvantageous to the UK.

My hon. Friend the Member for Bury North (Mr Nuttall) set out in his characteristically forthright style that he fundamentally disagrees with the whole process, which I fully respect. I am, however, sorry that he will not be joining us in the Lobby this afternoon. He will understand that we are currently part of a treaty that requires us to submit this convergence programme, and I explained to him following his earlier intervention why we wanted to submit a final document, rather than the draft that has been submitted in previous years.

My hon. Friend also asked about last year’s response from the EU. There was a response and I sent the European Scrutiny Committee an explanatory memorandum about that. He also asked about renegotiation, and I take note of what he said. We clearly will not be setting out a negotiating stance at present, but I draw his attention to the recent article written by my right hon. Friend the Prime Minister in The Sunday Telegraph—I do not have the exact date, but it was certainly within the past month or so—in which he set out some key areas for renegotiation. He talked about:

“Powers flowing away from Brussels, not always to it”,

and about

“National parliaments able to work together to block unwanted European legislation.”

I hope that all of that is music to the ears of my hon. Friend the Member for Bury North. As he would expect, further announcements will be made in due course.

Following this debate and Parliament’s approval, the Government will inform the European Commission of their assessment of the UK’s medium-term economic and budgetary position. The convergence programme will be submitted later today, which is a legal requirement under the EU’s stability and growth pact. The Government of course take legal requirements seriously. At the same

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time, however, I reiterate to hon. Members that, as in previous years, the document is based entirely on previously published documents that have already been presented to Parliament. The submission of convergence programmes by euro-outs and stability programmes by euro area member states provides a framework for co-ordinating fiscal policies. As I said, a degree of fiscal policy co-ordination across countries can be beneficial to ensure a stable global economy, which is in the UK’s national interest. It is important that we continue to use the European semester process to encourage member states to take national decisions on structural reform and growth that will help to support the European economy.

Budget 2014 set out the next steps in the Government’s long-term economic plan to secure the recovery and build a resilient economy, which requires tough decisions to put the public finances on a sustainable path. Budget 2014 supports businesses to invest, to export and to create jobs and cuts taxes for hard-working people. There is much still to do, however, and the Government are not complacent.

Ultimately, sustainable growth is the only way for both the UK and other EU member states to pay down their debts and to exit the current difficult economic times. The UK Government are leading the EU growth agenda and making the case for ambitious EU reform. On that basis, I am pleased to commend the motion to the House.

Question put.

The House divided:

Ayes 288, Noes 235.

Division No. 257]

[

3.13 pm

AYES

Adams, Nigel

Afriyie, Adam

Aldous, Peter

Amess, Mr David

Andrew, Stuart

Arbuthnot, rh Mr James

Bacon, Mr Richard

Baker, Steve

Baldry, rh Sir Tony

Baldwin, Harriett

Barclay, Stephen

Barker, rh Gregory

Barwell, Gavin

Bebb, Guto

Beith, rh Sir Alan

Bellingham, Mr Henry

Beresford, Sir Paul

Berry, Jake

Bingham, Andrew

Binley, Mr Brian

Blackman, Bob

Blackwood, Nicola

Blunt, Crispin

Boles, Nick

Bradley, Karen

Brady, Mr Graham

Brake, rh Tom

Bray, Angie

Bridgen, Andrew

Brine, Steve

Brokenshire, James

Bruce, Fiona

Bruce, rh Sir Malcolm

Buckland, Mr Robert

Burns, Conor

Burns, rh Mr Simon

Burrowes, Mr David

Burstow, rh Paul

Burt, rh Alistair

Burt, Lorely

Byles, Dan

Cable, rh Vince

Campbell, rh Sir Menzies

Carmichael, Neil

Cash, Mr William

Chishti, Rehman

Chope, Mr Christopher

Clappison, Mr James

Clark, rh Greg

Clarke, rh Mr Kenneth

Clifton-Brown, Geoffrey

Coffey, Dr Thérèse

Collins, Damian

Colvile, Oliver

Cox, Mr Geoffrey

Crabb, Stephen

Crockart, Mike

Crouch, Tracey

Davies, David T. C.

(Monmouth)

Davies, Glyn

Davis, rh Mr David

de Bois, Nick

Dinenage, Caroline

Djanogly, Mr Jonathan

Dorrell, rh Mr Stephen

Dorries, Nadine

Doyle-Price, Jackie

Drax, Richard

Duncan Smith, rh Mr Iain

Dunne, Mr Philip

Ellis, Michael

Ellwood, Mr Tobias

Elphicke, Charlie

Evans, Graham

Evans, Jonathan

Evans, Mr Nigel

Evennett, Mr David

Fabricant, Michael

Fallon, rh Michael

Farron, Tim

Featherstone, Lynne

Field, Mark

Foster, rh Mr Don

Fox, rh Dr Liam

Freeman, George

Freer, Mike

Fullbrook, Lorraine

Fuller, Richard

Gale, Sir Roger

Garnier, Sir Edward

Garnier, Mark

George, Andrew

Gibb, Mr Nick

Gilbert, Stephen

Gillan, rh Mrs Cheryl

Glen, John

Goldsmith, Zac

Goodwill, Mr Robert

Gove, rh Michael

Graham, Richard

Gray, Mr James

Grayling, rh Chris

Green, rh Damian

Halfon, Robert

Hames, Duncan

Hammond, rh Mr Philip

Hammond, Stephen

Hancock, Matthew

Hands, rh Greg

Harper, Mr Mark

Harris, Rebecca

Hart, Simon

Harvey, Sir Nick

Hayes, rh Mr John

Heald, Oliver

Heath, Mr David

Heaton-Harris, Chris

Hemming, John

Hendry, Charles

Hinds, Damian

Hoban, Mr Mark

Holloway, Mr Adam

Hopkins, Kris

Horwood, Martin

Howarth, Sir Gerald

Howell, John

Hughes, rh Simon

Hunt, rh Mr Jeremy

Huppert, Dr Julian

Hurd, Mr Nick

Jackson, Mr Stewart

James, Margot

Javid, Sajid

Jenkin, Mr Bernard

Johnson, Gareth

Johnson, Joseph

Jones, Andrew

Jones, rh Mr David

Jones, Mr Marcus

Kelly, Chris

Kennedy, rh Mr Charles

Kirby, Simon

Knight, rh Sir Greg

Lancaster, Mark

Lansley, rh Mr Andrew

Latham, Pauline

Laws, rh Mr David

Leadsom, Andrea

Lee, Dr Phillip

Lefroy, Jeremy

Leigh, Sir Edward

Leslie, Charlotte

Letwin, rh Mr Oliver

Lewis, Brandon

Liddell-Grainger, Mr Ian

Lloyd, Stephen

Lopresti, Jack

Loughton, Tim

Luff, Sir Peter

Lumley, Karen

Macleod, Mary

Main, Mrs Anne

Maude, rh Mr Francis

May, rh Mrs Theresa

Maynard, Paul

McCartney, Jason

McCartney, Karl

McIntosh, Miss Anne

McPartland, Stephen

McVey, rh Esther

Menzies, Mark

Metcalfe, Stephen

Miller, rh Maria

Mills, Nigel

Milton, Anne

Mitchell, rh Mr Andrew

Moore, rh Michael

Mordaunt, Penny

Morgan, Nicky

Morris, David

Morris, James

Mosley, Stephen

Mowat, David

Mulholland, Greg

Murray, Sheryll

Murrison, Dr Andrew

Neill, Robert

Newton, Sarah

Nokes, Caroline

Norman, Jesse

O'Brien, rh Mr Stephen

Offord, Dr Matthew

Ollerenshaw, Eric

Opperman, Guy

Osborne, rh Mr George

Ottaway, rh Sir Richard

Parish, Neil

Patel, Priti

Pawsey, Mark

Penrose, John

Percy, Andrew

Perry, Claire

Phillips, Stephen

Pickles, rh Mr Eric

Pincher, Christopher

Prisk, Mr Mark

Pritchard, Mark

Pugh, John

Raab, Mr Dominic

Randall, rh Sir John

Redwood, rh Mr John

Rees-Mogg, Jacob

Robathan, rh Mr Andrew

Robertson, rh Hugh

Robertson, Mr Laurence

Rogerson, Dan

Rosindell, Andrew

Rudd, Amber

Ruffley, Mr David

Rutley, David

Sandys, Laura

Scott, Mr Lee

Selous, Andrew

Shapps, rh Grant

Sharma, Alok

Shelbrooke, Alec

Simpson, Mr Keith

Skidmore, Chris

Smith, Chloe

Smith, Henry

Smith, Julian

Soames, rh Nicholas

Spelman, rh Mrs Caroline

Spencer, Mr Mark

Stanley, rh Sir John

Stevenson, John

Stewart, Bob

Stewart, Iain

Stewart, Rory

Streeter, Mr Gary

Stride, Mel

Stuart, Mr Graham

Stunell, rh Sir Andrew

Sturdy, Julian

Swales, Ian

Swayne, rh Mr Desmond

Swire, rh Mr Hugo

Syms, Mr Robert

Tapsell, rh Sir Peter

Teather, Sarah

Thornton, Mike

Thurso, John

Timpson, Mr Edward

Tomlinson, Justin

Truss, Elizabeth

Turner, Mr Andrew

Tyrie, Mr Andrew

Uppal, Paul

Vara, Mr Shailesh

Vickers, Martin

Villiers, rh Mrs Theresa

Walker, Mr Charles

Walker, Mr Robin

Wallace, Mr Ben

Walter, Mr Robert

Ward, Mr David

Watkinson, Dame Angela

Weatherley, Mike

Webb, Steve

Wharton, James

Wheeler, Heather

White, Chris

Whittaker, Craig

Whittingdale, Mr John

Wiggin, Bill

Willetts, rh Mr David

Williams, Mr Mark

Williams, Roger

Williams, Stephen

Williamson, Gavin

Willott, Jenny

Wilson, Mr Rob

Wollaston, Dr Sarah

Wright, Jeremy

Wright, Simon

Yeo, Mr Tim

Young, rh Sir George

Zahawi, Nadhim

Tellers for the Ayes:

Mr Sam Gyimah

and

Mark Hunter

NOES

Abbott, Ms Diane

Abrahams, Debbie

Ainsworth, rh Mr Bob

Alexander, rh Mr Douglas

Alexander, Heidi

Ali, Rushanara

Allen, Mr Graham

Ashworth, Jonathan

Austin, Ian

Bailey, Mr Adrian

Bain, Mr William

Balls, rh Ed

Banks, Gordon

Barron, rh Kevin

Begg, Dame Anne

Benn, rh Hilary

Benton, Mr Joe

Berger, Luciana

Betts, Mr Clive

Blears, rh Hazel

Blomfield, Paul

Blunkett, rh Mr David

Bradshaw, rh Mr Ben

Brennan, Kevin

Brown, Lyn

Brown, rh Mr Nicholas

Brown, Mr Russell

Bryant, Chris

Buck, Ms Karen

Burden, Richard

Byrne, rh Mr Liam

Campbell, rh Mr Alan

Campbell, Mr Gregory

Campbell, Mr Ronnie

Caton, Martin

Champion, Sarah

Chapman, Jenny

Clark, Katy

Clarke, rh Mr Tom

Coaker, Vernon

Coffey, Ann

Connarty, Michael

Cooper, Rosie

Cooper, rh Yvette

Corbyn, Jeremy

Creagh, Mary

Creasy, Stella

Cryer, John

Cunningham, Alex

Cunningham, Mr Jim

Cunningham, Sir Tony

Danczuk, Simon

Davidson, Mr Ian

Davies, Geraint

Davies, Philip

De Piero, Gloria

Dobbin, Jim

Docherty, Thomas

Dodds, rh Mr Nigel

Donaldson, rh Mr Jeffrey M.

Doran, Mr Frank

Doughty, Stephen

Dowd, Jim

Doyle, Gemma

Dugher, Michael

Durkan, Mark

Eagle, Ms Angela

Edwards, Jonathan

Efford, Clive

Elliott, Julie

Ellman, Mrs Louise

Engel, Natascha

Esterson, Bill

Evans, Chris

Farrelly, Paul

Field, rh Mr Frank

Flello, Robert

Flint, rh Caroline

Flynn, Paul

Fovargue, Yvonne

Francis, Dr Hywel

Gardiner, Barry

Gilmore, Sheila

Glass, Pat

Glindon, Mrs Mary

Goodman, Helen

Greatrex, Tom

Green, Kate

Greenwood, Lilian

Griffith, Nia

Hain, rh Mr Peter

Hamilton, Mr David

Hamilton, Fabian

Hanson, rh Mr David

Harman, rh Ms Harriet

Harris, Mr Tom

Havard, Mr Dai

Healey, rh John

Hendrick, Mark

Hepburn, Mr Stephen

Hermon, Lady

Heyes, David

Hillier, Meg

Hilling, Julie

Hodge, rh Margaret

Hodgson, Mrs Sharon

Hoey, Kate

Hollobone, Mr Philip

Hood, Mr Jim

Hopkins, Kelvin

Howarth, rh Mr George

Hunt, Tristram

Irranca-Davies, Huw

Jackson, Glenda

James, Mrs Siân C.

Jamieson, Cathy

Jarvis, Dan

Johnson, Diana

Jones, Graham

Jones, Helen

Jones, Mr Kevan

Jones, Susan Elan

Jowell, rh Dame Tessa

Kane, Mike

Kaufman, rh Sir Gerald

Keeley, Barbara

Kendall, Liz

Khan, rh Sadiq

Lammy, rh Mr David

Lavery, Ian

Lazarowicz, Mark

Leslie, Chris

Lewell-Buck, Mrs Emma

Lewis, Dr Julian

Llwyd, rh Mr Elfyn

Love, Mr Andrew

Lucas, Caroline

Lucas, Ian

MacNeil, Mr Angus Brendan

Mactaggart, Fiona

Mahmood, Mr Khalid

Mahmood, Shabana

Malhotra, Seema

Mann, John

Marsden, Mr Gordon

McCann, Mr Michael

McCarthy, Kerry

McClymont, Gregg

McCrea, Dr William

McDonagh, Siobhain

McDonald, Andy

McDonnell, John

McFadden, rh Mr Pat

McGovern, Alison

McGovern, Jim

McGuire, rh Mrs Anne

McKechin, Ann

McKenzie, Mr Iain

McKinnell, Catherine

Meale, Sir Alan

Mearns, Ian

Miller, Andrew

Mitchell, Austin

Moon, Mrs Madeleine

Morden, Jessica

Morrice, Graeme

(Livingston)

Morris, Grahame M.

(Easington)

Munn, Meg

Murphy, rh Paul

Nandy, Lisa

Nash, Pamela

Nuttall, Mr David

O'Donnell, Fiona

Onwurah, Chi

Osborne, Sandra

Owen, Albert

Paisley, Ian

Pearce, Teresa

Perkins, Toby

Qureshi, Yasmin

Raynsford, rh Mr Nick

Reed, Mr Jamie

Reed, Mr Steve

Reeves, Rachel

Reynolds, Jonathan

Robertson, Angus

Robertson, John

Robinson, Mr Geoffrey

Roy, Mr Frank

Roy, Lindsay

Ruane, Chris

Ruddock, rh Dame Joan

Sarwar, Anas

Sawford, Andy

Seabeck, Alison

Shannon, Jim

Sharma, Mr Virendra

Sheerman, Mr Barry

Sheridan, Jim

Shuker, Gavin

Simpson, David

Skinner, Mr Dennis

Slaughter, Mr Andy

Smith, rh Mr Andrew

Smith, Angela

Smith, Nick

Smith, Owen

Spellar, rh Mr John

Straw, rh Mr Jack

Stringer, Graham

Stuart, Ms Gisela

Sutcliffe, Mr Gerry

Tami, Mark

Thomas, Mr Gareth

Timms, rh Stephen

Trickett, Jon

Turner, Karl

Umunna, Mr Chuka

Vaz, rh Keith

Vaz, Valerie

Walley, Joan

Watson, Mr Tom

Watts, Mr Dave

Whiteford, Dr Eilidh

Whitehead, Dr Alan

Williams, Hywel

Williamson, Chris

Wilson, Phil

Winnick, Mr David

Winterton, rh Ms Rosie

Wishart, Pete

Wood, Mike

Woodward, rh Mr Shaun

Wright, David

Wright, Mr Iain

Tellers for the Noes:

Bridget Phillipson

and

Nic Dakin

Question accordingly agreed to.

30 Apr 2014 : Column 872

30 Apr 2014 : Column 873

30 Apr 2014 : Column 874

30 Apr 2014 : Column 875

Resolved,

That this House approves, for the purposes of Section 5 of the European Communities (Amendment) Act 1993, the Government’s assessment as set out in Budget 2014 and Autumn Statement 2013, combined with the Office for Budget Responsibility’s Economic and Fiscal Outlook (2014) and Fiscal Sustainability Report (2013), which forms the basis of the United Kingdom’s Convergence Programme.

Wales Bill (Programme) (No. 2)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the Order of 31 March 2014 (Wales Bill (Programme)) be varied as follows:

In the Table in paragraph (4) of the Order, in the column headed ‘Time for conclusion of proceedings’, for ‘The moment of interruption on the first day’ substitute ‘Ninety minutes after the moment of interruption on the first day’.—(Stephen Crabb.)

Question agreed to.

30 Apr 2014 : Column 876

Wales Bill

Considered in Committee

[1st Allocated Day]

[Dawn Primarolo) in the Chair]

Clause 1

Frequency of Assembly ordinary general elections

3.28 pm

Owen Smith (Pontypridd) (Lab): I beg to move amendment 9, page 1, line 5, leave out subsection (1) and insert—

‘(1) GOWA 2006 is amended as follows.

(2) Leave out subsection 3(1) and insert in substitution—

“( ) The poll at an election to the National Assembly for Wales is to be held on a Thursday on a date to be determined by a Resolution of the National Assembly for Wales.”.

( ) Subsection 3(2) is amended by—

(a) leaving out “If the poll is to be held on the first Thursday in May”; and

(b) in paragraph 2(a) by leaving out “that day” and inserting “polling day”.

( ) Leave out sections 4 and 5.

( ) Section 13 is amended by inserting after subsection (1)(c)—

“(1A) The order may not include provision about the date of an election to the Assembly.”.’.

The Second Deputy Chairman of Ways and Means (Dawn Primarolo): With this it will be convenient to discuss the following:

Amendment 30, page 1, line 6, at end insert ‘and after the words “order under”, insert ‘section 1A or’.

Amendment 10, page 1, line 8, at end add—

‘(3) A Resolution of the National Assembly for Wales under subsection (1) may not determine a date for the poll at an election to the Assembly that is the same as the date known or reasonably expected for a parliamentary general election as derived from the provisions of the Fixed-term Parliaments Act 2011.’.

Amendment 31, page 1, line 8, at end add—

‘(3) After section 3(1) of the GOWA 2006 insert—

(1A) A poll for an ordinary general election to the National Assembly for Wales may not be held within six months of the date of a general election to the United Kingdom Parliament.”.’.

Clause stand part.

Owen Smith: It is a pleasure to serve under your Bristolian and neighbourly chairmanship, Ms Primarolo.

Clause 1 relates to the timing of elections to the National Assembly for Wales. It is a response to the five-year term that has now been established for elections to this House. Our amendments 9 and 10 are probing amendments that seek to explore the Government’s willingness to concede the principle that the Assembly needs to have greater control and command over elections to it. That is what we are testing with our amendments.

Mr Mark Harper (Forest of Dean) (Con): I am pleased the hon. Gentleman said that these were probing amendments, but I notice that he has not troubled

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the Committee with an explanatory note, which is disappointing. My reading of the amendment is that it removes any necessity for an election to be held to the National Assembly. It allows the National Assembly for Wales to have no more elections ever. It appears to be the “Labour doesn’t want to have an election ever again in Wales” amendment.

Owen Smith: I hoped that we would have a serious debate today and serious interventions from colleagues across the Chamber. Obviously it is not the intention or the effect of the amendment to get rid of elections to the National Assembly for Wales, not least because we want those elections not to coincide with the changes made in the House by the hon. Gentleman when he was pushing through the gerrymandering legislation relating to elections to the House and the five-year term that we now endure. “Endure” is the right word, given how little business is being brought forward by the Government and how little work we have to do in the House. Today we have an important and serious Bill before us and I hope the hon. Gentleman will engage with it in a serious manner.

Mr Harper: Will the hon. Gentleman give way?

Owen Smith: No. We all want to get on with the serious business before the Committee, not nonsensical point-scoring.

These are probing amendments. They explore the extent to which the Government agree with us that, in principle, it should be with the consent of the National Assembly that changes are made to elections that affect it.

Mr Mark Williams (Ceredigion) (LD): I, too, am glad that these are probing amendments. I very much agree with the principle that the hon. Gentleman is establishing that these responsibilities should be devolved to the National Assembly, but what safeguards does he envisage operating there to ensure that gerrymandering, of which he has, sadly, accused the Government, could not occur in the National Assembly?

Owen Smith: The clear principle to which we are responding with these amendments was outlined by the Welsh Government in their response to the Green Paper produced two years ago. For the information of the Committee, that stated that

“no change to the Assembly’s current electoral arrangements should be made without the Assembly’s consent. This is the fundamental constitutional principle in issue. It is a necessary consequence of a constitution based upon the principle of devolution.”

That is a clear expression from the Welsh Government on the centrality of their view in any changes to legislation which affect the elections to their Chamber—to the Assembly in Wales. That is something we wish to explore today with the Government.

Clearly, the Bill arises from the shift to a five-year fixed-term Parliament for this place. Three separate pieces of legislation needed to be amended as a consequence—the Scotland Act 1998, the Northern Ireland (Miscellaneous Provisions) Act 2014, and now the Government of Wales Act 1998. Labour is not opposed to fixed-term Parliaments, as the hon. Member for Forest of Dean (Mr Harper) will recall. In previous manifestos, including the last manifesto, Labour has

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consistently pledged to shift to fixed-term Parliaments, but we have consistently said that a five-year fixed term for any institution was too long.

Jonathan Evans (Cardiff North) (Con): I am grateful to the hon. Gentleman for the tone with which he started his speech. Will he explain the rationale for his sticking with a Thursday? Since he is aiming to give responsibility to the National Assembly and to let it decide the issue entirely, why does he say that the poll should be held on a Thursday? He will be aware of a growing body of opinion among those who undertake electoral research, who look to examples on the continent, where elections are held at weekends—traditionally on Sundays—or opportunities when people may be able to participate more in the electoral process. Perhaps he can help us to understand why, since he is putting the proposition that it is entirely a matter for the National Assembly, he has restricted polling day to a Thursday.

Owen Smith: It is a great pleasure to serve under your chairmanship, Dr McCrea. I had not spotted that you had arrived, for which I apologise.

The simple answer to the hon. Gentleman’s question is that this is, of course, the custom, practice and protocol in British elections for all institutions. I hear what he says about the interesting debate about whether, in an era of great cynicism towards and disinterest in and disengagement from politics, we ought to expand people’s opportunities to vote. Labour Members are looking seriously at that and have already suggested that it ought to be looked at, but for the purposes of this Bill and the principle under discussion, as opposed to the issue raised by the hon. Gentleman, it seemed simpler to stick to the customary practice of a Thursday. That is why we did not suggest a change.

Huw Irranca-Davies (Ogmore) (Lab): Perhaps the hon. Member for Cardiff North (Jonathan Evans) will have an opportunity to table a probing amendment on that issue. Why does the Bill refer to five years? I understand that that is how this Parliament currently operates, but is there now an accepted body of wisdom that says that five years should be the default position of any democratic Assembly or Parliament?

Owen Smith: The reality is that the accepted, orthodox wisdom of electoral experts around the world, certainly in Britain, is that five years is probably too long and that four years would be more appropriate. Certainly in the history of this place, four years has been not the norm, but the exception. Ordinarily, over the long term, elections to this place have taken place rather more frequently than that. Our primary concern—this reflects the view of all parties in the National Assembly for Wales, particularly the Welsh Labour Government—was to ensure that the elections for this House and those for the National Assembly did not coincide on the same day, which would have been the case without the changes introduced by this Bill. Nevertheless, it struck us as important to probe the Government’s view of the degree of consent they ought to seek from the National Assembly and the respect they ought to show to devolution when making changes to an election that is not ours. I think that the view of most people—it is certainly the view of most experts—is that five years is too long.

30 Apr 2014 : Column 879

Mr Harper: On Second Reading, the hon. Gentleman responded to a question asked by, I think, the hon. Member for Rhondda (Chris Bryant) by kind of giving the impression that Labour’s policy, if it were returned to power, would be to revert to a four-year term for this House and amend the Fixed-term Parliament Act 2011. Will the hon. Member for Pontypridd (Owen Smith), for the convenience of the Committee, confirm that?

Owen Smith: The hon. Gentleman claims that I implied that, but I do not think I have been explicit on the matter, either then or now. When we last debated the issue, we were clear that the majority opinion is that four years is better than five. Another orthodox opinion in Britain and elsewhere is that too many changes to constitutional matters are bad for the electorate and that constantly chopping and changing for partisan reasons—as the hon. Gentleman did when introducing the 2011 Act—is bad for democracy in Britain. In the light of that, and in a period in which people are disengaged from politics, we may choose not to be partisan and not to pursue that sort of strategy when we win the next election.

Hywel Williams (Arfon) (PC): I want to refer to the point made by the hon. Member for Cardiff North (Jonathan Evans). There is a great deal of virtue in considering holding elections on days other than a Thursday. That is the practice in other countries. Perhaps the hon. Member for Pontypridd (Owen Smith) can help the Committee with his historical knowledge: have elections in the UK always been held on Thursdays? I seem to remember that at some point in our history they were not.

Owen Smith: I believe that the hon. Gentleman is right. Elections have not always been held on a Thursday. However, in recent memory and certainly in the last century, elections have mainly been held on a Thursday, which is why we are sticking to it in amendment 9. That is not the substantive point that we are trying to make; it is an interesting debating point, but not one that we need to bother the Committee with any longer.

With that, I conclude my remarks on our amendments to clause 1. We do not intend to put them to the vote, but we want to hear the Government’s views on the need for them to engage properly with, seek proper consent from and pay proper respect to the devolved Administration in Cardiff.

Mr Harper: It is a great pleasure to serve under your chairmanship, Dr McCrea.

I want to pick up the hon. Member for Pontypridd (Owen Smith) on his response to my intervention. I was deadly serious. If he wants to intervene, I will happily take his intervention, but I am afraid that his amendment would do exactly what I said it would do. It would amend section 3(1) of the Government of Wales Act 2006, which states that a poll

“at an ordinary general election is to be held on the first Thursday in May in the fourth calendar year following”

the previous one. In other words, the provision insists that there has to be an election every four years. His and his hon. Friends’ amendment would remove section 3(1) of Government of Wales Act and simply provide that the poll

30 Apr 2014 : Column 880

“at an election to the National Assembly for Wales is to be held on a Thursday on a date to be determined by a Resolution of the National Assembly for Wales.”

That does not leave in the legislation any requirement for a periodic election. If the amendment were put into law and the National Assembly for Wales did not set a date for an election, there would never be such an election. An accurate characterisation of his amendment is that it is a “Labour party governs Wales for ever” amendment. Under his provision, if any party with a majority in the National Assembly for Wales simply does not set a date, there will be no election, and no back-stop in legislation would insist on an election. I absolutely accept that that may not have been the hon. Gentleman’s intention, but that is the effect of his amendment.

Owen Smith: As I have said, that effect was not our intention. I will not repeat myself, but I will say that were it our intention to stop more elections to the National Assembly for Wales, that would be a pretty peculiar thing for us to do because although we currently govern as a minority Government in Wales, we of course anticipate governing as a majority Government in Wales in the near future. I look forward to more elections in Wales, especially given the polls showing that both the hon. Gentleman’s party and the Liberal Democrats are failing badly.

Mr Harper: I am grateful to the hon. Gentleman for confirming that that effect was not the intention of his amendment. However, as I have said, that would be its effect, and the Committee obviously has to consider the amendment on the amendment paper—the one he drafted and tabled—not one that he probably now wishes he had drafted. As I have said, it is not sensible to give the National Assembly for Wales the power to do exactly what the amendment suggests, which is to have no back-stop at all.

I am now even more confused about the Labour party’s policy on term limits. The hon. Gentleman is quite right that, during the passage of the Fixed-term Parliaments Bill, his party did not disagree with the concept of fixed terms. It was very clear that it did not support five-year terms, but preferred four-year terms. On Second Reading just a few weeks ago, he made it clear in response to the hon. Member for Rhondda (Chris Bryant) that he wanted to move to four-year terms. I suggested that the hon. Member for Pontypridd ought perhaps to have a word with his party leader, and it sounds from his slightly more nuanced response that he has had such a conversation and been told that under no circumstances is he to pledge moving back to four-year terms. That probably also provides an answer to the hon. Member for Ogmore (Huw Irranca-Davies).

I will not say any more about the amendments of the hon. Member for Pontypridd, which he has confirmed are probing amendments, but I want to comment on Plaid Cymru’s amendments 30 and 31, specifically amendment 31. They highlight an important issue, which is one for the Committee to debate, about the coincidence of elections. We discussed that when we debated the Fixed-term Parliaments Bill, and it was one reason why I, as the then responsible Minister, decided to move the date of the National Assembly for Wales election.

30 Apr 2014 : Column 881

3.45 pm

There are two schools of thought on this matter. The first is that elections should be separated so that the debate on the issues that face the United Kingdom can take place and the British people can make a decision that is separate from the decisions that face the Welsh electorate. There is a perfectly sensible argument for that. The second view is that we should adopt the US model and have all the elections that we can possibly have on the same day. That means accepting that the public are perfectly able to distinguish between the elections.

Although I accept the latter point, we arrived at the conclusion that we did because of the point about media coverage and the ability for issues to be explored properly. I think that the public are perfectly capable of making decisions in different elections on the same day. The danger is that not all of the appropriate issues will be explored in the coverage, the debates in the media and the debates between party leaders.

Hywel Williams: This is a genuine inquiry. Does the hon. Gentleman recall the election day in Scotland when there were elections for various public offices using different electoral systems? I seem to remember that it was disastrous.

Mr Harper: The hon. Gentleman makes a good point. If we have elections on the same day, we certainly need to ensure that there is clarity about the electoral systems and in the design and printing of the ballot papers, so that it is clear for people not just which parties they might want to vote for, which is a decision for them, but the mechanism by which they can do so. A lot of lessons were learned from that process. We had that in mind when we held the referendum on the parliamentary voting system and we tried to ensure that there was not the level of confusion that there had been in the past.

Amendments 30 and 31 are hopeful amendments. Having considered all the evidence, I think that it makes sense to separate the big elections. I am not sure whether six months is long enough. We decided to shift the elections by an entire year to separate the media coverage and the debates so that people could focus on the important issues. The amendments raise some sensible issues. It makes sense to keep the elections to the primary legislative assemblies in the UK—the Scottish Parliament, the Welsh Assembly, the Northern Ireland Assembly and this Parliament—apart. That was the provision that we made in the Fixed-term Parliaments Act 2011.

I am therefore pleased that the Bill presented by my right hon. Friend the Secretary of State permanently makes the terms of the Assembly the same length as those of this House, but offset by a year to keep the elections separate. That will enable a proper debate to take place before elections to this place and will enable Welsh voters to have a proper debate about the issues that the Welsh Assembly and Welsh Assembly Government will focus on.

Finally, if people’s decisions in Welsh elections are indeed made on issues for which the Welsh Assembly and the Welsh Assembly Government are responsible, my reading of the situation, based on how the Welsh Assembly Government are handling the national health service in Wales, which I will not talk about today, but

30 Apr 2014 : Column 882

which we will return to on the second day of Committee, is that the Welsh public might reach a different conclusion from that put forward by the hon. Member for Pontypridd. I look forward to their having the opportunity to do so and to the result, because I think that it might shock the hon. Gentleman. He should not be so complacent.

Jonathan Edwards (Carmarthen East and Dinefwr) (PC): It is a pleasure to serve under your chairmanship, Dr McCrea, and to speak to amendments 30 and 31, which appear in my name and those of my hon. Friend the Member for Arfon (Hywel Williams) and my right hon. Friend the Member for Dwyfor Meirionnydd (Mr Llwyd). They are both probing amendments and follow the spirit of the contributions by the hon. Members for Pontypridd (Owen Smith) and for Forest of Dean (Mr Harper).

We welcome the fact that we are discussing a piece of Wales-specific legislation. It is only three years since the remarkable referendum in 2011, when the people of Wales voted overwhelmingly in favour of full political sovereignty over the political fields that were devolved to the National Assembly. I have no hesitation in saying that that was one of the proudest days of my political career. The desktop on the computer in my Westminster office has a picture of the referendum count in Carmarthenshire, with the yes votes piled up proudly on the yes table, and a few bundles of no votes on the no table.

Chris Ruane (Vale of Clwyd) (Lab): Get a life!

Jonathan Edwards: Well, apart from the Swans staying up this year—another great achievement, which I know the hon. Member for Pontypridd (Owen Smith) shares with me.

Most striking about the referendum result was that it was matched across every county in Wales—apart from Monmouthshire, which only just voted no. When the history of Wales is written, that result will be recorded very strongly when compared with the referendums of ’79 and ’97. It was an earthquake moment, and I remember the shell-shocked faces of many Unionists down in Westminster the week after that historic occasion.

The nature of the game has therefore changed, and subsequent opinion polling clearly indicates that the people of Wales want greater control over their lives. I think they are far ahead of the political class at the moment, and I even include Plaid Cymru in that context. Today we are discussing in historical terms a further milestone on the path towards Welsh self-government, with, for the first time, a national legislature being empowered to have an element of fiscal powers. Needless to say, the Bill does not go anywhere near as far as my party would want in terms of powers for Wales, but as an historian in a previous life I can safely say that when the history of Wales is written, this period will be seen as one of rapid political development for our nation.

As we celebrate the 20th anniversary of the great indie band from Manchester, Oasis, and its first studio album in ’94, I am reminded of one of its best songs, “Little by Little”. I hope sincerely that when we conclude our Committee deliberations we will not be “looking back in anger”—a reference to another of its great songs. Today is therefore another landmark in the political development of our country.

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The context of the Bill is interesting in itself, and I get the impression that the Secretary of State would rather walk through fire than deal with the Bill today. I am sure he sees it as a hospital pass from his predecessor. The Bill results, of course, from the UK Government-sponsored Silk commission, in particular part I, and I pay tribute to Sir Paul and his fellow commissioners for their work on both stages of the report. As I said, as a party our evidence to both parts of the commission called for far greater progress than was finally agreed, but we were prepared to compromise to seek agreement and make progress. It is therefore disappointing that we find ourselves presenting amendments in Committee, and endeavouring to preserve the integrity of the Silk commission.

Unfortunately, the Wales Bill has torpedoed the recommendations of the Silk commission, particularly in relation to the lockstep on the income tax powers, which we will discuss later. Even more regrettably, it seems that Labour’s amendments to the Bill, rather than strengthening it as we seek to do, aim to place further roadblocks and move us even further from what the Silk commission proposed.

Glyn Davies (Montgomeryshire) (Con): The hon. Gentleman is running through the parts of the Bill that he disagrees with, and it is entirely possible that people on both sides of the Committee may disagree because it is a wide-ranging Bill. Does he accept, however, that the Bill makes dramatic progress in that it provides the foundation stones for financial accountability to be vested in the National Assembly for Wales? That is a key step forward that makes the Bill hugely important for the interests of Wales.

Jonathan Edwards: As I said, I think the Bill will be viewed as an important milestone in the constitutional development of our country, but it will not surprise the hon. Gentleman to hear that my ambition for Wales is greater than what is set out in the Bill.

Owen Smith: A moment ago the hon. Gentleman said that Labour was in some way seeking to undermine the Bill, and I am aware from media reports that that is the line Plaid Cymru is taking in the media. I wish to place on record that that is the opposite of what we are seeking to do. We are probing the Bill today but we will support it. We are looking to strengthen the powers held by the Welsh Assembly in many regards, and we are seeking greater symmetry on tax powers with Scotland. Crucially, we will be tabling amendments to secure fair funding in advance of any of those changes, and looking to ensure that we move to a reserved powers model—all of which I am sure the hon. Gentleman would support.

Jonathan Edwards: If that is indeed the hon. Gentleman’s position, I am sure he will join us in the Lobby when we vote on the new clauses later.

The second major context in which this debate takes place is the seismic events happening in Scotland. As I said yesterday in the Welsh Affairs Committee, the second part of the Silk commission’s work will be superseded by the result of the independence referendum, one way or the other. Even the Bill could be superseded by events in Scotland, as its proceedings in the Lords are likely to happen after the people in Scotland have cast their vote in the independence referendum.

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Jonathan Evans: Does that really hold good as an argument? The hon. Gentleman will have seen current opinion polls that show that support for independence—as opposed to support for devolution—in Wales is at an all-time low. He has rightly talked about the seminal change in Wales in which the Conservative party has joined other parties to support devolution, but the result of the Scottish debate so far is that support for Welsh independence is lower than ever before.

Jonathan Edwards: I do not want to get into a debate about independence, but the most detailed polling ever undertaken on devolutionary attitudes was by the Silk commission in the second part of its work. It suggested that 20% of people in Wales wanted devolved defence and foreign affairs, and those would be the two last powers that would ever be devolved.

Regardless of the result in Scotland, the constitutional landscape of the UK will change considerably. If Scotland votes yes, that will be the end of the British state as we know it. If it votes no, the likelihood is that it will get significantly more powers, with 90% approval ratings for a devolution-max settlement that would devolve everything apart from defence and foreign affairs. Is the hon. Gentleman seriously saying that the people of Wales would accept the settlement in the Bill if Scotland were to get significantly more powers, even in the event of a no vote?

Chris Ruane: If the vote in Scotland is close but ultimately a victory for no, does the hon. Gentleman anticipate that the SNP will come back for another vote, and another after that, and that it will not be so much a referendum as a neverendum?

Jonathan Edwards: As long the people of Scotland have those aspirations and vote for an SNP Government, I imagine that they would want to ask the question on subsequent occasions, but that is a debate for another time. Considering the way in which the opinion polls are moving, it seems that the question might be settled this time.

Mr Elfyn Llwyd (Dwyfor Meirionnydd) (PC): I remind the House that the Prime Minister said a few months ago to the people of Scotland that, whatever happens, devo-max is on offer to them. My hon. Friend is right to say that that means that the constitutional set-up of the UK will have to change, come what may.

Jonathan Edwards: As ever, I am very grateful to my right hon. Friend for his valid and expert intervention. Whatever happens in Scotland, it will completely change the political landscape and supersede Silk and even perhaps what we are discussing today.

With the Scottish question in mind, I believe that the UK Government have missed an opportunity to bring forward a settlement that would have helped them to develop a narrative in Scotland in which the Westminster elite recognised the national aspirations of the people of the nations of the state, and were happy to reform the relations between the nations of these isles to preserve the future of the state. One obvious measure would have been to devolve income tax powers to Wales in the Bill without the Scottish lockstep model. We will debate that issue in greater detail, but suffice it to say at this

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point that the unambitious nature of the Bill leaves the people of Scotland in little doubt that the referendum is a straight choice between more powers with yes and the status quo with no.

Amendments 30 and 31 would ensure that the poll for an ordinary general election to the National Assembly could not be held within six months of a general election for the UK Parliament. I am reassured by the discussion I had with the Minister before the debate. That, and the comments by the former constitutional Minister, the hon. Member for Forest of Dean, is why I am probing rather than pressing the amendments to a vote. When he took the Fixed-term Parliaments Bill through the House, he did a lot of work to ensure that there would be no coterminosity between the Assembly and the general election. That would have presented a great danger to our democracy in Wales.

4 pm

This is important because we have to mitigate the damaging effect that media distortion can have on democratic debates in Wales. Plaid Cymru was excluded from the 2010 election TV debates, in which no mention was made of the fact that much of the discussion surrounding health, education and other devolved areas would not affect the people of Wales. Wales has a number of daily newspapers, notably the Western Mail and the Daily Post, but their readership is extremely small. Many fantastic local papers are under pressure, not least the Carmarthen Journal, South Wales Guardian, the Tivyside Advertiser and the South Wales Evening Post.

Chris Ruane: The Ryhl Journal.

Jonathan Edwards: And the Rhyl Journal, although I am not an avid reader, I must admit.

Most people get their political news from London papers. If we have a Westminster election and an Assembly election in close proximity, there is a great danger that the issues for which the national Assembly is responsible will be dropped completely. The Minister has indicated that there is no intention to bring the elections closer and that there are protections in the Bill to ensure that there will be a gap of at least a year between them, so I am happy not to press my two amendments.

On the Labour amendments, the Electoral Reform Society has lobbied extensively against amendment 9, arguing that

“good governance and greater stability is achieved through fixed terms and this should not be a power that is given to the Executive to decide.”

It points out that, as the electoral system for the Assembly makes coalitions more likely, fixed terms also provide stability and security for parties of government. Two of the four terms in the Assembly have seen coalition Governments, so I agree with that point.

Amendment 10 appears to have been drafted with the aim of ensuring that Assembly and Westminster elections are not held on the same day. I would have been happy to support that if it had been pressed to a vote.

The Parliamentary Under-Secretary of State for Wales (Stephen Crabb): I, too, would like to start by welcoming you to the Chair, Dr McCrea. It is a pleasure to serve

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under your chairmanship. I thank hon. Members on both sides of the Committee for their contributions to this early part of the first day of our deliberations.

Amendment 9 would give the Assembly the power to decide, by resolution, when Assembly elections are held, and would remove the Secretary of State’s powers in relation to varying the date of Assembly elections and proposing a date for extraordinary Assembly elections. Amendment 10 would prevent the Assembly from setting a date for an election on a day on which it knows, or reasonably expects, a parliamentary general election to be held. The amendments would permit the Assembly to determine the date of Assembly elections and consequently the length of its own terms. That reflects a recommendation made by the Welsh Affairs Committee arising from its pre-legislative scrutiny of the draft Wales Bill.

It is worth pointing out that the Silk commission considered the matter of legislative competence for Assembly elections to be outside its terms of reference and made no recommendations in this regard in its second report. Nevertheless, the Government believe that the devolution of further powers to the Assembly should not be undertaken in a piecemeal fashion, and that the issue would best be considered in the wider context of possible changes to the Welsh devolution settlement arising from the recommendations made by the commission in its second report. The Government made clear, on publication of the report, that recommendations requiring primary legislative change should be a matter for the next Parliament and the next Government, and consequently that they should be for political parties to consider in preparing their election manifestos. We believe the same principle should apply when considering whether legislative competence for Assembly elections should be devolved to the Assembly. It is important that electors are clear on how long they are electing Assembly Members for when they vote in the 2016 Assembly election, and that five-year Assembly terms are in place by then to ensure that Westminster and Assembly elections do not coincide in 2020.

The Fixed-term Parliaments Act 2011 moved this House to a fixed five-year cycle and consequentially provided that the next ordinary general election to the National Assembly for Wales would be moved on a one-off basis by one year from 7 May 2015 to 5 May 2016. This responded to concerns raised by the Assembly that holding general elections to this House and to the Assembly on the same day could lead to the Assembly elections being overshadowed. I am encouraged that Members of all parties seem to be in agreement on the position that we do not want the two elections coinciding. I particularly welcome the Labour party’s support in seeking to minimise the risk of that, which is evident in amendment 10.

Similarly, amendments 30 and 31, tabled by right hon. and hon. Members from Plaid Cymru, are intended to ensure that an ordinary Assembly general election does not take place within six months of a UK general election. I am encouraged that the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) has been reassured by the debate so far and by our previous discussions, and that he is not going to press his amendments on that basis.

There is cross-party support for the principle that, as far as possible, we should seek to ensure that ordinary general elections to the Assembly and to this House

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should not coincide. With the next Assembly election scheduled for 2016, if the Assembly remains on a four-year cycle, the two sets of elections would coincide every 20 years, starting in 2020—something that all parties are clearly keen to avoid. Clause 1 makes it far less likely that Assembly elections and parliamentary elections will coincide in future. I therefore ask Opposition Members to support the clause, to consider the further devolution of powers to the Assembly in the context of preparing their own parties’ manifestos and consequently to withdraw or not press the amendments.

Owen Smith: I am grateful to the Minister for acknowledging that our amendments reflect the views of the Welsh Affairs Committee and, indeed, as I said earlier, those of the Welsh Government, and that they were tabled in good faith. I am equally pleased to hear that when it comes to looking at the Silk commission part I report or any legislation that might arise from it or be reflected in the manifestos before the next election, the Government will be open to considering whether the Assembly should be responsible for—or at least have the ability to consent to—when the elections should take place. In the light of the Minister’s remarks, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 1 ordered to stand part of the Bill.

Clause 2

Removal of restriction on standing for election for both constituency and electoral region

Mr Harper: I beg to move amendment 15, page 2, line 33, at end add—

‘(5) The Secretary of State shall make arrangements for an independent review of the—

(a) likely and possible impacts on the effectiveness of the Assembly of the removal of the restriction on standing for both constituency and electoral region. In particular, the review shall examine the implications for the desirable total number of Assembly members and the proportions elected by each route; and

(b) advantages and disadvantages of amalgamating the five Assembly electoral regions into one for the whole of Wales.

The Secretary of State shall lay a copy of the report of the review before each House of Parliament within nine months of this Act receiving Royal Assent.’.

The Temporary Chair (Dr McCrea): With this it will be convenient to discuss the following:

Clause stand part.

New clause 4—National Assembly to set number of AMs—

‘Her Majesty may by Order in Council provide for the transfer of responsibility for setting the number of Assembly Members to the National Assembly for Wales.’.

New clause 6—Transfer of responsibility for determining electoral system—

‘Her Majesty may by Order in Council provide for the transfer of responsibility for determining the system of election of members of the National Assembly for Wales to the Welsh Government.’.

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Mr Harper: The Committee will be pleased to know, I hope, that I view this as a probing amendment—unless I am provoked. I thought it would be helpful to draw out some of the implications resulting from taking a wider look at the issues about clause 2 that were raised on Second Reading. I shall say a few words of support for clause 2 and its principles and also speak about new clauses 4 and 6.

Amendment 15 is designed to achieve a number of things. Members will remember that the Parliamentary Voting System and Constituencies Act 2011 effectively decoupled the linkage between the geographic constituencies of the Welsh Assembly and the Westminster ones. Although, after the amendment to the Electoral Registration and Administration Act 2013, this has not yet taken effect for the 2015 general election—sadly, in my view—it will of course kick in for the 2020 election unless the primary legislation is changed. It thus seems sensible to look separately at the number of geographic constituencies that we need for electing Members to the Welsh Assembly, to look at the number of regions to determine whether we should have a number of regions or a single region, and to look at the relative balance between constituency seats in the Welsh Assembly and those elected on a list system which obviously affect the proportional nature of the system.

The system that we have now is the one that was set up at the beginning of the process. I think that, following the experience of a number of sets of elections and a number of different Administrations, as well as a change in the powers and responsibilities of the National Assembly, it would be sensible for the total number of Assembly Members and the relative balance between the different election routes to be considered. The setting up of an independent review by the Secretary of State is one possible way of going about that, although obviously there are other possibilities.

Albert Owen (Ynys Môn) (Lab): The hon. Gentleman wants a review because of the additional powers given to the Assembly, and because elections have produced either minority or coalition Governments in Cardiff Bay. Is it his personal opinion that there should be more Members of the National Assembly because of those additional powers? I fear that, rather than ending up with regional Members on the list system, we shall end up with parties choosing from the party list, and that, as a result, Members will come disproportionately from one area of Wales, and will not be representative. The additional Members have constituency work to do, and if the hon. Gentleman’s amendment were passed, that would be diminished.

Mr Harper: If the hon. Gentleman reads my amendment, he will see that it is very balanced. It simply calls for an independent review, the report of which would go to the Secretary of State, who would lay it before each House of Parliament so that it could be considered. [Interruption.] The hon. Gentleman says that I have an opinion, and I do, but let me explain what the amendment will do—because Members will want to think about what is on the amendment paper—before explaining my view and what I consider to be the appropriate direction of travel.

The amendment simply suggests that the review should

“examine the implications for the desirable total number of Assembly members”

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of the changes that we are making in clause 2—and I think it very sensible to revert to the original position, which the Labour party altered—and also examine the

“advantages and disadvantages of amalgamating the five Assembly…regions into one for the whole of Wales.”

That is because if the number of constituency seats is changed, depending on the number of those seats, it can be difficult to come up with equally sized regions. Alternatively, the regions have to be changed every time the number of constituencies changes.

Jonathan Evans: I am seeking to reflect the tone of my hon. Friend’s remarks. I accept that he is only asking for a review. However, before he gives his own view to the Committee, perhaps I can ask him to comment on his experience of the change that took place when the European Parliament moved from a system of individual constituencies to a system of vast regions. I myself have experience of representing the whole of Wales under that system. It has been pretty universally regarded as very difficult for any Member to represent an area of that size, and my hon. Friend must have had the same experience in his own part of the world. Do we really need to review this matter? Perhaps, when he outlines his own view, he will reflect on what I have said.

Mr Harper: My hon. Friend has made a very sensible point. The south-west of England is certainly a large region. I think I am right in saying that my hon. Friend the Member for Tewkesbury (Mr Robertson) has put it on record that the distance between one end of the south-west region and the other is greater than the distance between his constituency and the Scottish border. Moreover, the south-west region now includes Gibraltar. It is a very significant region, and a difficult region to represent. I suspect that very few electors in that region could, hand on heart, name any of their MEPs, let alone all of them.

If we are to consider changing the number of Members of the Assembly in the geographic constituencies, we must then ask how the regions are to be grouped, and whether they should end up being equal in size. At present, there are five regions with four seats in each region. That works very well mathematically if there are 20 Assembly Members and half the Members are constituency Members, but if the number of constituencies is changed—and I shall explain in a moment why I think that that should happen—some choices will have to be made about regions.

We may end up with regions that are different in size. If the regions then become too small, with too few seats, the problem is that we do not get the proportionality in those regions that the list system is designed for. We may not want to consider using the whole of Wales and instead consider having just fewer, larger regions, but I accept that pushing against that is exactly the point my hon. Friend makes about the remoteness of elected Members from voters. Two things are pushing in different directions and we have to keep them in balance, which is why we need a review to examine both aspects so that a future Parliament can make a decision.