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Lord Mackie of Benshie: My Lords, does the noble Viscount believe that the Scottish people will put up with that sort of treatment? They have a remedy because they can put out the Government if they do not like it.

Viscount Weir: My Lords, thank you very much. As noble Lords will have gathered, I dislike these proposals in principle. They raise as many questions as they answer--or more. But there is not the time today to go into even a few of the problems. To sum it all up,

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perhaps I may remark that, to my own great regret, what this paper simply does is to replace the nine of diamonds as the curse of Scotland.

5.18 p.m.

Lord Prys-Davies: My Lords, I welcome the Welsh White Paper and I shall support it in the referendum campaign. It delivers what the Labour Party promised in its manifesto. I believe that the Welsh Secretary of State, his ministerial colleagues and officials at the Welsh Office who have produced the White Paper are to be congratulated on it. The Government are to be congratulated on bringing it forward so early in the present Parliament.

It is obvious, of course, that the proposed Welsh assembly is not as powerful as the proposed Scottish parliament. Yet let nobody underestimate its significance. Setting up an elected Welsh assembly is a crucial step forward in the history of Wales. As has been pointed out by my noble friend Lord Sewel and others, it should bring significant benefits to Wales. I should like briefly to summarise four in particular.

First, a directly elected assembly will bring a new impetus to Welsh life and provide a focus for democratic action in Wales.

Secondly, it will extend democratic control over widespread responsibilities for the government of Wales and will work, in the words of the White Paper, "to promote and foster" local government in line with the European charter on local self-government. I understand that the Welsh local authorities are satisfied with the role of an assembly, as set out in the White Paper.

The third significant benefit of the assembly is that it will provide a permanent forum for the Welsh nation to determine its priorities in the devolved areas and to fashion policies suited to Welsh needs within the discretion allowed by primary legislation.

The fourth significant value of an assembly is that it has at least the potential to give Wales a stronger voice within the increasingly important European Union. Those are the benefits as I see them.

I turn now to a few areas of the White Paper upon which I would welcome more information, clarification or explanation. I refer first to the Welsh block. It seems that the assembly leader and the leader of the assembly's finance committee will not have direct access to the Treasury in negotiating the Welsh block. The Welsh assembly may not be content with such an arrangement. Moreover, it seems that the Secretary of State will deduct from the Welsh block a sum to be determined by him (not necessarily in agreement with the assembly) in respect of the running of his own department and that the remainder will be handed to the assembly. The point is very obvious: the assembly may wish to have a voice in determining the split. I hope that those points, and their implications, will be borne in mind when preparing the Bill.

Secondly, since about 46 per cent. of the block fund is accounted for by local authority expenditure and about one-third by the NHS, what body is to secure the external audit of that expenditure? It seems to me that

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that could not appropriately be undertaken by the assembly itself. It should be carried out by an external body. To my mind--the fault may well be mine--paragraph 4.37 is somewhat unclear as to the role of the Audit Commission. That leads me to another question. In the event of friction between the assembly and a sponsored body, how will that issue be resolved? Is it a matter that should be spelled out in the Bill or are the sponsored bodies to rely on judicial review?

My next question is about the important area of delegated legislation. The Welsh Office has in very recent years been making greater use of order-making powers, but it is worth making the point that we are moving into a new dimension in which a far greater range of independent work and thought is going to be needed if the assembly is to be able to pursue within the framework of primary legislation different policies from those which the central government pursues in England. Some years' experience of the Joint Committee on Statutory Instruments suggests that time must be given to pre-legislation consultation, but the timetable is often tight. It is envisaged in paragraph 3.40 of the White Paper that there will be close consultations between assembly officials and their counterparts involved in policy-making at Whitehall on the timing and content of secondary legislation. Moreover, we are told that the basis for those consultations will be set out in concordats. It is important that a draft of the concordats should be available when the Bill is published so that we may have ample opportunity to digest them.

There is a further point. If there is a dispute between the Government and the assembly on the content of a draft assembly order, how will it be resolved? It would appear that the White Paper may be offering two different routes: the speedy settlement procedure under paragraph 3.32 and the procedure under paragraph 3.43. It is important that the Bill deals clearly with the mechanism for resolving any friction. It would be helpful if the Minister could explain the details of the speedy procedure.

My last question relates to the European dimension. I recognise that relations with the EU will remain the responsibility of the UK Government. Even so, I cannot help wondering whether enough has been proposed to give Wales a clearer and stronger voice within the EU. I shall read carefully what my noble friend Lord Sewel said when opening the debate; nevertheless, I should be heartened if the Government would consider during the summer months whether the proposals could be added to in the light of the paper Wales in Europe which has been published by the Institute of Welsh Affairs.

I end where I began by welcoming the White Paper. The Welsh White Paper is a middle solution between the status quo and the Scottish parliament. I believe that it will satisfy majority opinion in Wales. If Wales wants to face the future with confidence, it must build its future around the assembly. I hope and believe that the Welsh electorate will give Parliament the authority to implement the provisions of the White Paper.

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5.26 p.m.

Baroness Carnegy of Lour: My Lords, I shall concentrate, if I may, on the Scottish White Paper. Given the Labour Party's manifesto commitment and the Government's inheritance of what came out of the Scottish Constitutional Convention, the White Paper seems to me to be a competent document, describing clearly and concisely (admittedly with a few omissions and awkwardnesses) the arrangements that the Government have in mind.

I should like to make one main point and to illustrate it a little. The issue for the referendum voters in Scotland is whether the attractiveness, potential advantage and satisfaction for them of electing and maintaining a complete additional parliament is worth the cost--the cost in terms of the disadvantage which it is likely to bring to Scotland and any damage that it might do to the current system of co-operation which makes all parts of the United Kingdom good places in which to live.

The anticipated advantages of the price to be paid are much clearer now that the White Paper has been published. It is very important at this juncture that the Scots should understand and weigh the issue properly in the balance and that they do not simply close their eyes and agree to back the proposed scheme just because it has been long promised and is assumed to be inevitable.

North of the Border, the attractions of the White Paper are not hard to see. People would undoubtedly get a lot of satisfaction from taking part in elections to the new parliament, knowing for the first time that it was they, and only they, who were deciding who would be in charge of the Scottish Office. They would enjoy the focus that the parliament would provide and being able to follow on television and in the press what the people they had elected were up to, their debates and their decisions. People in Scotland would follow that a lot more easily than is possible for them with the Westminster Parliament, where what is UK business, what is England and Wales business and what is Scottish business is often a lot less clear than it should be.

Another plus is that such great change will create comparatively limited departmental upheaval. I do not believe that noble Lords south of the Border realise that in the main the areas of government to be devolved to the Scots parliament are almost precisely those already devolved to the Scottish Office. It is also attractive that within the constraints of its budget the Scots parliament will have very wide freedom to choose its spending priorities. People need to know of those advantages. I believe that most appreciate them but not all. There are other advantage which need to be made plain to them.

They must also understand the down-side. I refer not simply to the added cost of the parliament building, its staff, its elected members and other activities, but to the likely effect in many areas of Scottish life on incomes, businesses, jobs, good relations within the United Kingdom, Scots influence at Westminster and the workability and quality of Scots legislation.

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For example, almost every day the Scottish media give three cheers to the Secretary of State for gaining Cabinet approval to the continuation of the present Scottish Office block grant and formula system as the main way of funding the Scots parliament. Chapter 7 and Annex B of the White Paper reveal, as noble Lords who have been in government already know--certainly I did not know--that the all-important block grant is calculated mainly not on the needs of Scotland but on a negotiated figure of the needs per head of population of England and Wales. That figure is then added to by a percentage to allow for the additional needs in Scotland. Somewhat ominously for Scotland, paragraph 7.7 on page 22 makes plain that the extra Scottish percentage is liable to revision at any time. Scots need to understand that, especially as the new transparency of funding mechanisms will make the English MPs a little more observant than they were before.

We also need to understand in Scotland the likely combined effect on business and jobs of the freedom of the Scots parliament to increase income tax and to control or not control non-domestic rates. These matters were discussed very eloquently by my noble friend Lord Weir. Those freedoms, added to the minimum wage, will be a treble whammy for Scottish jobs if the Scots parliament does not realise the implications of disregarding them. Scots who do not want the break-up of the United Kingdom--more than four out of five do not--need to realise that, although the White Paper limits the areas in which the Scots parliament can legislate, it allows it to discuss anything and apparently to promote a referendum on anything. No wonder the nationalists rejoice. The scope for stirring up trouble within the United Kingdom seems to be endless, which is very worrying. It may be that when we come to legislate we need to consider that point. Scots must also realise the implications of their reduced influence at Westminster, where the most important decisions will still be made.

The Boundary Commission review of constituencies will reduce the number of Scots MPs. In addition, it is unlikely that English MPs at Westminster, given the new arrangements, will stand for Scots MPs occupying the influential positions that they occupy at present. At the moment, the Chancellor of the Exchequer, the Chief Secretary, the Economic Secretary, the Foreign and Defence Secretaries and the Minister of Transport all represent Scots constituencies. With the Secretary of State for Scotland, that means that there are six Members representing Scots constituencies in the Cabinet. I suggest that such influence in the United Kingdom is unlikely to apply to the Scots parliament. I believe that Scots should understand that.

The Dearing report has only just been published. It is too soon to say what will be the effect of the Scots parliament on the universities. The White Paper is good news in that it recognises the need to keep the funding of university research via research councils at Westminster. That is wise, and that is what the universities' and lecturers' unions want. I am sure that they are already grateful to the Government for that.

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I should like to ask the Minister--I gave the Scottish Office Minister notice of my question--about student support. Arrangements for that matter in Scotland will be devolved. It is possible, say, that at a future date the Scots parliament will decide that Scots students must contribute only £500 to their tuition fees, whereas England and Wales students must contribute £1,000. Should that happen, who would make up the missing £500 to universities in England and Wales to which Scots students might go? How would Scots university funding be affected?

Before they vote in the referendum Scots must be able to weigh the balance of advantage and disadvantage of this White Paper. I hope that the Government will make that balance plain. If they do not there may be much dissatisfaction not just in Scotland but across the United Kingdom in years to come, and everyone will know whose fault it is.

5.37 p.m.

Lord Elis-Thomas: My Lords, we are all in danger of repeating ourselves on this issue. At the risk of doing so, I repeat that these White Papers are not about the end of the United Kingdom either now or in the years to come. That argument has been rehearsed again today. I hope that once the referendums have been held and there is a "Yes" vote that particular argument will come to an end.

Sometimes I feel that I have been repeating myself for the past 18 years. If I have been doing that so has the noble Lord, Lord Crickhowell. Today not only did he repeat himself but he repeated all of the tired arguments of very old Labour in another place. I did not believe that I would live to see the day when the noble Lord, Lord Crickhowell, would embellish his speeches with the collective thoughts of Mr. Alan Williams, Mr. Denzil Davies and Mr. Ted Rowlands.

My noble friend Lord Prys-Davies never repeats himself. He has yet again posed sharp questions for Ministers on the detailed content of the White Paper. He is able to do so because this is a sharp and intelligent White Paper. I pay tribute to the Welsh Office Ministers. I never thought that I would live to see the conversion of the Ron Davies that I knew and loved 25 years ago into the St. Ron whom I now worship and follow everywhere. To progress from boyo politician to national leader is a tremendous achievement, and I salute him in all seriousness. One makes light of these matters, but when there is a "Yes" vote his achievement will go down in the history of Wales.

My text for today is paragraph 3.3 of the White Paper, which refers to the national assembly for Wales--as I shall now describe it following yesterday's debate--in the following terms:

    "[It] will complete the chain of democratic accountability running all the way from the community council through unitary local authorities and Westminster on to the European Union".
That is a point which I understand noble Lords opposite who are believers in a sovereign unitary state have difficulty in following. In my view that is not an adequate description of how the UK functions. Their

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ideal model of a state is replicated nowhere in the world, as far as I can see. Indeed, all members of the EU have a regional structure. The leading exception, of course, is the Grand Duchy of Luxembourg.

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