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House of Lords

Wednesday, 21 March 2012.

3 pm

Prayers-read by the Lord Bishop of Birmingham.

Work Capability Assessment: Cancer Treatments


3.06 pm

Asked By Baroness Morgan of Drefelin

Baroness Morgan of Drefelin: I beg leave to ask the Question standing on the Order Paper in my name, and in so doing I declare an interest as chief executive of a research cancer charity.

Lord De Mauley: My Lords, our informal consultation on accounting for the effects of cancer treatment in the work capability assessment closed on 9 March. We received almost 90 responses to the consultation. We are currently analysing these responses and will in due course publish a consultation response which will outline our proposals. Until we have done so, it would be inappropriate to comment on any changes to the work capability assessment.

Baroness Morgan of Drefelin: My Lords, can the Minister inform the House what action the Government are taking to ensure that the intended introduction next month of the contributory ESA time limit will not impact adversely on those cancer patients who are currently claiming contributory ESA?

Lord De Mauley: Before I do so, my Lords, I would like to place on record our thanks to the noble Baroness and Breast Cancer Campaign for the valuable work that they do in this field. We are committed to supporting cancer sufferers in the most appropriate way through the welfare system. As evidence of that commitment, a year ago we extended the support group to include both those awaiting and those between courses of treatment. As a result, 68 per cent of employment support allowance claimants whose primary condition is cancer are placed in the support group and will be unaffected by time-limiting. We of course recognise that some individuals will be affected. This is a highly sensitive area and we must get our proposals right. That is why, as I explained, we undertook a consultation, are analysing the responses we received and will publish a response soon. We will then fully assess the implications of those proposals, with a view to implementing such changes as are necessary as quickly as possible.

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Lord German: My Lords, the Government have had just nine or 10 days since the consultation ended to bring a response. However, does my noble friend agree that the state and the benefit system have to perform the important job of supporting people who have suffered or are suffering from cancer and ensure that not only the method of treatment but also the condition of each individual is looked at? We must treat every person as an individual and not take a tick-box approach to their problems.

Lord De Mauley: My noble friend makes an extremely good point.

Baroness Gardner of Parkes: My Lords, what is the position with people undergoing chemotherapy? In many cases, if they are on a monthly cycle, the first week will be absolutely intolerable; then they will be fine for two weeks; then it will be absolutely ordinary living in the next week; and then they will start the cycle again. Is that treated as a total continuing period for a work capability assessment, or will they be expected to do something in the one week when they are better off?

Lord De Mauley: My noble friend makes a valid point. Of course she is right: they will be treated as being under treatment.

Lord McKenzie of Luton: My Lords, can the Minister give us an update on the success rate of appeals against WCA determinations?

Lord De Mauley: Yes, my Lords. The rate of successful appeals remains at about 40 per cent. We recognise the importance of getting decisions right the first time, and we are committed to improving the decision-making process as part of the drive to ensure that the work capability assessment is as fair and effective as possible.

Health and Social Care Bill: HIV/AIDS Programmes


3.10 pm

Asked By Baroness Thornton

Baroness Northover: My Lords, HIV services are, and will continue to be, comprehensive. They include surveillance and national and local prevention, treatment and care. The NHS Commissioning Board will lead on commissioning treatment and care services. This recognises that HIV treatment is specialised and that prevalence varies. Local authorities will commission HIV prevention services in line with their wider remit regarding sexual health and health inequalities.

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Baroness Thornton: I thank the Minister for that Answer, which confirms that HIV treatment and care will be commissioned by the national Commissioning Board, that some preventive work will be conducted by local authorities and that national HIV prevention will be commissioned by Public Health England. However, it is unclear who will commission post-exposure prophylaxis following sexual exposure, PEPSE, which is vital specialist work to halt the spread of HIV. Who will commission that work, and how do the Government intend to ensure that all the services will not be diminished by being commissioned by at least three different bodies or lost when those bodies begin their work?

Baroness Northover: I assure the noble Baroness that the current high level of care and commissioning will continue. The reason the Commissioning Board is taking responsibility nationally is that this is a costly disease to treat and its prevalence is varied around the country, so it makes sense if the board has overall responsibility for that. As the noble Baroness knows, public health has moved to the local authorities, which is why it is appropriate for prevention to be placed at that level. With regard to joining up care, as she knows, the health and well-being boards locally will do a great deal to ensure that they look at the needs of the population in that locality and that care is delivered appropriately in their local area.

Lord Fowler: My Lords, in preventing the spread of HIV, does my noble friend agree that the most important step taken in the process of the health Bill was the Government's decision that free HIV treatment should be made available for everyone in this country? When I withdrew my amendment, it was on the understanding that the Government would introduce their own statutory instrument. When will that happen, and when does my noble friend expect the new system to be in operation?

Baroness Northover: I thank my noble friend Lord Fowler for all that he has done in this area, not least on this particular change, which we were very happy to announce we would be taking forward. The important thing here is the protection of our population. The House of Lords Select Committee had rightly flagged that if some overseas visitors who were not currently covered were left in that situation, there would be an increased risk to our population. I am extremely glad to say that we have extended treatment to cover that group so that we can look after our population. We are on course for the timetable that we laid out before, and this should be introduced in the autumn.

Baroness McIntosh of Hudnall: My Lords, what incentives does the Minister think there will be for local authorities, once they have public health responsibilities, to invest properly in the prevention of HIV/AIDS when the treatment costs will not fall to them? Can she confirm that currently a very much smaller proportion of funds is spent on prevention compared with the enormous cost of treatment? It would be in everyone's interests if that balance were addressed somewhat.

Baroness Northover: The local authorities will commission the prevention and testing services. They have a public health outcomes framework that they need to address to drive up the situation across the board in

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public health. There are incentives within that for them to try to improve the health of their populations. Local authorities are best placed to understand the public health pressures, which are not just in this area, on their local populations.

On prevention and treatment, the emphasis in recent years-under the previous Government, as under ours-has been on the high-risk groups, particularly gay men and people from the sub-Saharan region. Those are the groups at greatest risk. However, a sexual health policy document is being worked on at the moment. If it is felt that it is important to feed into it that there is a need for nationwide emphasis on this matter, now is the time to emphasise it.

Baroness Masham of Ilton: My Lords, will the Minister assure the House that there will not be fragmentation in regard to this very complicated condition? Will there be NICE guidelines? The drugs for HIV are very complex and there is a fear that there might be resistance.

Baroness Northover: As with every other area, this will kept under close review to make sure that things are suitably joined up and that we have high-quality prevention and treatment. As for NICE guidelines, the British HIV Association produced clinical guidelines for HIV treatment in 1999. They were taken forward and are widely accepted by clinicians and commissioners. The association is currently revising its guidelines and we will see what it suggests.

Baroness Barker: My Lords, do the Government still support the work of the UK National Screening Committee and, if so, how will its recommendations be implemented in future?

Baroness Northover: Yes, indeed, the UK National Screening Committee will remain as an independent advisory body and will continue to advise the Government and the NHS on all aspects of screening. The NHS constitution, which was drawn up by the previous Government, commits the Government to providing screening programmes as recommended by the UK National Screening Committee. The NHS Commissioning Board will commission national screening programmes on the Secretary of State's behalf.

Lord Tomlinson: Will the noble Baroness explain how what she said about frameworks in the early part of her rather lengthy answer to my noble friend Lady McIntosh differs from having targets in the National Health Service?

Baroness Northover: I have been allocated much more time for this Question than my colleague was for the previous one, so I apologise if I am taking too long to answer. The noble Lord will have to wait to see how that transpires.

Lord Walton of Detchant: My Lords, does the noble Baroness agree that one of the difficult problems in the area of prevention is the fact that it is not ethically possible to take a blood sample to test an individual

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for HIV without their informed consent? The problem that arises is that a number of people who are at risk refuse to give consent, even though they continue to have sexual contact, and that is very difficult to overcome.

Baroness Northover: The noble Lord is absolutely right. From my other area of international development, I know only too well that that is true world wide. Things have improved enormously in the United Kingdom, where people with HIV are now living normal lives and there is much less discrimination than there used to be. That helps in encouraging people to come forward for testing. However, the noble Lord is absolutely right and it is extremely important that we reduce the stigma so that they are content to do so.

Lord Roberts of Llandudno: My Lords, as health is devolved to Scotland, Northern Ireland and Wales, how does the United Kingdom national screening project include them? Is there any particular mechanism or understanding there?

Baroness Northover: Public Health England will be liaising with the different parts of the United Kingdom to ensure that what is learnt in one area is propagated to others so that the different parts of the United Kingdom can learn from each other. We look to what happens in England, Scotland and Wales. That came up frequently in the Bill and will continue to be the case.

Baroness Thornton: My Lords, perhaps I may come back to the noble Baroness as she completely failed to answer one of my questions, which was about PEPSE. Who will commission the vital work which halts the spread of HIV?

Baroness Northover: I was accused of answering at too great a length. The Commissioning Board will oversee commissioning. It is working out how that can best be delivered and whether various things should be commissioned at the local level. If the noble Baroness would like to feed into that process, that would be very welcome.

The Earl of Listowel: My Lords, this may be slightly wide of the Question, but can the noble Baroness say what progress has been made in reducing maternal transfer of HIV in this country, and how that compares with the progress made on that issue in sub-Saharan Africa? That may be very wide of the Question and she may like to write to me.

Baroness Northover: I am very happy to write to the noble Earl, but the information I have suggests to me that it has been declining.

Criminal Records Bureau


3.21 pm

Asked By Lord Vinson

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The Minister of State, Home Office (Lord Henley): My Lords, the Criminal Records Bureau has issued more than 31 million certificates since its launch in March 2002 and has received more than £868 million in fees. The bureau does not hold any information to determine what portion of this cost has been paid by applicants, employers or other bodies.

Lord Vinson: I thank the Minister for his very considered reply. Trust is the glue that holds society together. Is he aware that many organisations find that this staggering level of CRB checks is overdone, is disproportionate to the risk and is putting off good volunteers? As aggressive paedophilia is rare, and unlikely in the presence of others, will he reissue the sensible Home Office guidance on this matter and so help re-engender trust and good neighbourliness?

Lord Henley: My Lords, my noble friend is right to draw attention to the importance of trust. He is also right to draw attention to the very high number of certificates that have been issued. This is a matter that we have been addressing in the course of the Protection of Freedoms Bill. I refer my noble friend to the impact assessment of last year on that Bill, which estimated that there would be a reduction of some 50 per cent in the number of such certificates being issued, dropping from about 3.7 million a year to something like 1.7 million. I think that is a step in the right direction.

Baroness Deech: Will the Minister be good enough to give the House his opinion of the effect that the following scenario will have on the outreach work carried out by this House? I invite a small group of A-level students to visit this House, as I have done before, to sit in the Chamber, to have tea and to take a small tour, and the teacher writes asking me please to confirm that I have had a CRB check.

Lord Henley: Obviously, the noble Baroness is a most tremendous risk to the public and to children and I hope that she will consider these matters very carefully. No-that is what we want to address and it is the point of some of the changes we are making as a result of the Protection of Freedoms Bill. It is why we will keep these matters under review and it is why my right honourable friend the Home Secretary launched her initial review into these matters last year. I go back to the supplementary question of my noble friend Lord Vinson when he talked about trust being important. We think it is vital that people take a common-sense approach in these matters.

Baroness Walmsley: When and in what way will the Government be communicating to the ISA and the police the statement that my noble friend made last week during the passage of the Protection of Freedoms Bill in response to the amendment tabled by the noble Lord, Lord Bichard: that the ISA can pass on to the police the information that has led to a discretionary bar so that the police can then use their discretion to release that information to a conscientious employer who requests it?

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Lord Henley: My Lords, the Bill has not completed its passage and it will obviously have to come back to this House after consideration of Lords amendments in another place. After completion, when we have had our last chance to discuss these matters, we will issue that guidance.

Lord Harris of Haringey: Further to that question, the noble Baroness suggested that it would be discretionary for the ISA to pass such information to the police. I had understood the Minister to say that his intention was for that information to be passed to the police automatically, so that they could use their discretion. Does he agree that having two sets of discretion in this area is likely to lead to individual cases falling through the net, which could be very damaging to the children who might subsequently be abused?

Lord Henley: My Lords, I do not have the precise words that I used on that occasion, but the noble Lord is probably right to imply that we were offering discretion to the police.

The Earl of Erroll: What percentage of these certificates would reveal either a criminal record or information that would bar these people from working?

Lord Henley: My Lords, I cannot answer that question, but I can say that in the 10 years in which this system has been running some 130,000 potentially unsuitable people have been prevented from working with children and vulnerable adults. The noble Earl can use that figure against the figure of 31 million and work out his own percentage.

Lord Hunt of Kings Heath: My Lords, can the noble Lord confirm that it is the Government's view that in general the establishment of CRB checks and the system that came from it was essential to ensure that vulnerable people are protected? Having said that, and coming back to the question of the noble Baroness, Lady Deech, does he agree that part of the problem is overzealous interpretation by a number of organisations? Perhaps the Government's best efforts should be put into working with those organisations on guidance, information and education, so as their decisions on the number of people who need CRB checks might be more proportionate.

Lord Henley: My Lords, I accept that it was necessary to bring in the CRB and these checks, but things had become out of proportion. That is why my right honourable friend announced her review and is why we want to scale things back to allow people to take proper responsibility for these matters. That is what we are trying to do, and it was what we were trying to do in the Protection of Freedoms Bill, but we will obviously keep these matters under review. If we can further scale down the checks without putting children or vulnerable adults at risk, we will do so.

Lord Flight: My Lords, when I was at school, it was quite common for people to have school exchanges and stay with a family in France or Germany, pick up

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the language and learn a bit. These exchanges have virtually disappeared for the same reason that we have been hearing-checks have to be done on the families with whom the children will be staying. Does the Minister agree that this is yet another system that is over the top? Surely, the schools themselves can do checks on children's parents.

Lord Henley: My right honourable friend brought in the review exactly because of those concerns-damage to exchange visits, volunteering and the like. That is why she conducted her review last year and is why we made changes during the course of the Protection of Freedoms Bill.

Lord Marlesford: My Lords, will the Minister try to ensure that the Criminal Records Bureau focuses on areas of real priority? For example, does the bureau hold records of people's passports, including foreign passports? After all, if you want to stop someone on the watch list leaving or entering the country, it is quite useful to know what passports they hold, including foreign ones.

Lord Henley: My Lords, without notice, I am not sure that I can answer my noble friend's question about passports, but I shall certainly offer to write to him in due course.



3.29 pm

Asked by Lord Knight of Weymouth

The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Taylor of Holbeach): My Lords, droughts happen in the natural order of things, and the Government's reaction to the current dry spell is being planned for in detail with the Environment Agency and water companies. The Government recognised the risks early on and, since May 2011, the Secretary of State has held three drought summits to agree actions to manage the impact of drought. Water companies are working closely together to conserve public water supply, and government and key sectors are meeting regularly.

Lord Knight of Weymouth: I thank the Minister for that reply. The effects of drought are now too apparent in some parts of the country. For example, the River Kennet has in part dried up already. Does that not reinforce the urgency of taking forward the Government's proposals on water abstraction? The contents of the Queen's Speech have been even more pre-briefed than today's Budget. Why has Defra failed to land a slot for a water Bill that would mean that we could get on with urgent action on water supply?

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Lord Taylor of Holbeach: My Lords, it is not for me to anticipate the contents of the Queen's Speech, and certainly not to use the opportunity of this Question to do so. Noble Lords will know that next week we will consider a water Bill that deals with time-sensitive matters and which I hope will have the concurrence of the House. The noble Lord will have to wait to see whether the water White Paper is translated into legislation in the Queen's Speech when it occurs.

Lord Hamilton of Epsom: My Lords, will my noble friend comment on reports in the press recently about the proposal for a main line to be run alongside the high-speed link connecting to Birmingham and beyond, which would bring water down from the north-west to the drought-stricken regions of the south-east?

Lord Taylor of Holbeach: My noble friend anticipates a Question on the Order Paper about a national grid for water. Of course, all those matters have been considered by this and other Governments. It has been found that the interconnectivity of water systems is far more cost-effective than building a mainline grid. Water is extremely energy-expensive to pump around. Unfortunately, it does not naturally flow from the north of England to the south-east.

Lord West of Spithead: My Lords, on that point, has much work been done on the use of operational and non-operational canals to assist in that transfer?

Lord Taylor of Holbeach: Yes, it has, and to a limited extent they can be used in the interconnectivity projects between water companies. The companies are sharing a great deal and have invested considerable amounts. There has been a recent investment in the north-west of England to relieve a drought there by pumping water from Wales.

Lord Naseby: Is my noble friend aware that in 1976, when a severe drought affected eastern England, comprehensive work was done even on reversing the flow of rivers. Could he usefully dust down those files and look at all the work that was done in that period?

Lord Taylor of Holbeach: I can assure my noble friend that these things are constantly under review. I do not know that any particular major projects will alleviate this drought period, but it is important that we make the most of the natural links that we have and the best use of the water that is available to us.

Lord Tomlinson: Will the Minister reflect that if he is going to brush down the files from 1976, to accompany them he must remember that not only did we have a Labour Government but we had Denis Howell? What plans does he have to resurrect the spirit of Denis Howell?

Lord Taylor of Holbeach: How can noble Lords be assumed to have forgotten? I seem to remember that when Denis Howell was appointed Minister for Drought, it did not stop raining.

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Lord Stoddart of Swindon: Will the Minister ensure that water companies do not close existing storage capacity for developing housing and other things? In particular, will he get in touch with Thames Water, which is closing storage capacity in Reading?

Lord Taylor of Holbeach: I do not know the details of the particular case to which the noble Lord refers, but it is certainly useful to be advised of that. Thames Water is not in as acute a situation as some of the other water companies. Indeed, it is helping out water companies in Essex by transferring water from its area to Essex. This co-operation between water companies is a very good strategy, and one which the Government are anxious to encourage.

Lord Plumb: My Lords, may I confirm what the Minister has just said? I was a member of Denis Howell's committee, and I confirm that it rained the moment we met and did not stop for weeks. One hopes that if we can form a committee again, the same sort of thing will apply. I congratulate the Government on recognising the importance of water, its usage and its conservation. It is more crucial than people in this country perhaps realise. However, would the Minister agree that in the interest of food security, irrigation is essential? It is going to be a major problem in many areas. I realise that the Environment Agency has the responsibility for maintaining the main arterial rivers. Many of these have been neglected in recent times, which is a matter of importance that needs to be considered. However, restricting water for irrigation for certain food crops would be catastrophic and would result in crop failure.

Lord Taylor of Holbeach: It is very good to have my noble friend volunteering yet again to deal with this matter on behalf of us all. There are considerable concerns in agriculture, particularly about establishing crops. However, farmers are used to dealing with the weather. They are by nature adaptable creatures. They are changing cropping programmes in some parts of the country, and they will change them in others. It is far too early to say what impact this may have on the food supply. All I can say is that the NFU and the Environment Agency are involved in the weekly bird table meetings that are held on this subject, and that is an extremely effective mechanism for getting the flexibility that we need to deal with this problem.

London Local Authorities Bill [HL]

Commons Amendments

3.37 pm


Moved by The Chairman of Committees

The Chairman of Committees (Lord Brabazon of Tara): My Lords, I do not intend to move these amendments individually as many of them deal with rather minor

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matters. There are, however, a number of amendments to the Bill which it may be helpful to draw to the House's attention.

First, the Select Committee in another place deleted in its entirety the provision that would have required food hygiene information to be displayed in food premises. Secondly, the Select Committee also removed the provisions relating to the management of houses in multiple occupation, and provisions containing powers of entry into such houses. Thirdly, provisions relating to entertainment involving nudity were removed from the Bill at the request of the promoters following a change in national legislation. The promoters also agreed on Report to remove from the Bill a new offence of obstruction of an authorised officer.

The remainder of the amendments are either minor or consequential on the changes that I have mentioned. I hope that the House will agree to the amendments made in another place. I beg to move.

Motion agreed.

Scotland Bill

Committee (5th Day)

3.38 pm

Moved by Lord Wallace of Tankerness

The Advocate-General for Scotland (Lord Wallace of Tankerness): My Lords, in moving this Motion, it may be helpful if I indicate that my right honourable friend the Secretary of State for Scotland tabled a Written Ministerial Statement which has been made available in the Printed Paper Office since this morning. He has also written to the Shadow Secretary of State for Scotland, Mrs Margaret Curran MP, and circulated that letter to other party spokesmen in the House of Commons in which he gives an indication of the consultation. He concludes his letter by saying:

"In making this information available now, I am seeking to balance the need to ensure that tomorrow's debate in the House of Lords is as well informed as possible, with the need to provide Parliament with a full and detailed analysis of the consultation in due course".

I should perhaps have said that the Written Ministerial Statement reflected agreement reached between the United Kingdom Government and the Scottish Government on the basis of which the Scottish Government will be tabling a legislative consent Motion in the Scottish Parliament. Obviously, we shall bring forward amendments to reflect that agreement. They will certainly be subject to debate, and possibly votes, and we will commend them to the House when we meet on Report next week. I beg to move.

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Lord Forsyth of Drumlean: My Lords, I thank my noble friend Lord Wallace of Tankerness for the Written Statement and for circulating the copy of the letter from the Secretary of State. However, without being churlish, I should like to complain in the strongest possible terms about the way in which this legislation is being handled. We agreed to defer the consideration of those parts of the Bill which relate to referendum amendments until after the consultation process had been completed. Your Lordships will recall that we were considering the Bill in Committee when, out of the blue, came the consultation paper, to which responses were required by 9 March. Therefore, we agreed to consider the Bill so that we would be able to debate the issues arising from the referendum on independence with the knowledge of what had happened during the consultation process. As a result of that, the Bill, although it has been before Parliament for well over a year, is being considered right at the end of the Session, so we also agreed that the normal period between Committee stage and Report stage would be truncated.

This afternoon, we are now faced with a two-page letter from the Secretary of State, which tells us very little about the consultation paper but tells us, as my noble friend has just said, that,

that is today's debate-

When I was a Minister, "in due course" meant six months. We shall have to consider the Report stage of this Bill on Monday and Wednesday and, therefore, the only opportunity that we have to table amendments which relate to the first parts of the Bill is tomorrow. There is absolutely no time for us to take account of the consultation. I very much hope that my noble friend will impress on his colleague, the Secretary of State for Scotland, that it really is unacceptable that we should go into Report stage on Monday without a full analysis and full information relating to the consultation process and an indication of where the Government stand on this. To add a little zest to that, perhaps I may give notice that, in the absence of that undertaking, I will table a Motion for Monday to provide for that.

I turn to my second point which relates to something that is quite unacceptable. I am not being critical here of my noble friend as I know he is the messenger in this respect-I should have said my noble and learned friend; indeed, I may have played some small part in that, but that is another story-and I realise that he is taking the Bill through the House with great courtesy and skill. However, in earlier consideration of these matters, when we raised the issue of legislative consent and whether the Scottish Parliament was giving legislative consent, we were not informed of what we are now informed of: that the Government have done a deal with the Scottish Government, that the concessions made are very extensive, and that they relate to this Bill. Again, we are being told that amendments will be tabled by the Government. Presumably, these amendments will be tabled tomorrow and, therefore, there will little opportunity for us to consider them. However, I have taken the measure of placing a new amendment on the

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Marshalled List for today which will give us an opportunity to discuss at least some of the issues set out in the Written Ministerial Statement to which my noble and learned friend referred.

In short, this is a major constitutional Bill which has huge implications for people in Scotland and huge implications for people in the rest of the United Kingdom. The way in which the parliamentary process has been handled has limited our opportunity. I have to say to my noble and learned friend that his right honourable friend has treated this House with a degree of contempt. He knew that we were delaying these proceedings to deal with the consultation process, and to give us such a cursory analysis of the consultation, at the very last minute, at 11 o'clock on the day, makes it impossible for us to have a fully informed debate. Therefore, I am not going to spend any time this afternoon discussing the referendum issues. I shall leave that until Monday. Furthermore, I was told at lunchtime today that on Monday there is to be new business which will be tabled to be discussed before the Scotland Bill, so once again our time for consideration of the Bill is being curtailed.

The behaviour of Ministers towards this House is one of the most persuasive arguments I have ever seen for devolution. We are not giving the proper consideration that we should give to a major constitutional Bill with enormous implications.

3.45 pm

The Earl of Caithness: I wonder whether my noble and learned friend can help me with the parliamentary procedure. We are discussing the referendums this afternoon. When are they going to be dealt with on Report? As my noble friend Lord Forsyth has just said, they were delayed at this stage. Is it likely that we will be discussing them on Monday? If so, those of us who have to travel to the far north of Scotland tomorrow will have precious little time to table amendments. It will give us at least a day or two longer to consider matters and read the Official Report if they are to be dealt with on Wednesday. It is crucial for us in how we conduct our business to know whether the referendum issue will be taken on Report on Monday or Wednesday.

Lord Foulkes of Cumnock: I understand the noble Lord's frustration about the whole process and the way it has been dealt with. The noble Earl, Lord Caithness, makes a very good point, which others made earlier, about the time between Committee and Report. The noble Lord, Lord Forsyth, also made that point effectively.

I think we should absolve the noble and learned Lord, Lord Wallace of Tankerness, of blame in relation to this. He has been faced with great difficulties from a number of sources. I was going to include the noble Lord, Lord Forsyth as one of the people who created some difficulty for him, but I will just put that to one side for a minute. The noble Lord has had to labour with a Cabinet which has only recently begun to realise some of the implications of Scottish independence and what it might mean-to our defence policy and to a range of other things-if it were to go ahead. It has taken some time for it to realise the enormity of the

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possibility of Scotland seceding from the rest of the United Kingdom, and that is something that the noble and learned Lord, Lord Wallace, has had to deal with. He has also had to deal with a very difficult negotiating body in the Scottish Executive, and its leader in particular. Driving a bargain with it is not easy.

We should consider that earlier this week-and I hope I am not giving any secrets away-we may not have had even this letter and the Statement today if it had not been for the intervention of the noble and learned Lord, Lord Wallace of Tankerness. Admittedly, he was under pressure from the Opposition-both the Front and Back Benches-and no doubt from the noble Lord, Lord Forsyth, as well, but it is to his credit that he got us the Statement. Otherwise we would really have been dealing with it in the dark.

Lord Forsyth of Drumlean: I am most grateful to the noble Lord. I have no complaint about the noble and learned Lord, Lord Wallace, but I do not know what the noble Lord thinks he has. He has a letter from the Secretary of State that states that his preferred solution, which is to use the existing Scotland Act to provide for a referendum, was supported by a large number of people and that he is hopeful that he can reach agreement with the Scottish Government. Frankly, we have known this for some time. I should like to know what the numbers were, what people said and what the Government's attitude is. What is the point of us debating these matters if we do not know the Government's policy? This has nothing to do with the Cabinet; it is about the conduct of business in Parliament, and we are being short-changed.

Lord Foulkes of Cumnock: That is a point on which I agree with the noble Lord, Lord Forsyth. Indeed, I have a Question down for next Monday asking when the result of the consultation will be published. I had expected it to be published before now, and certainly for this debate-and, if not, at least for Monday's debate. However, we also have the information contained in the Statement made today by the Secretary of State. It makes substantial progress-we will discuss this later-in its reference to transferring tax and borrowing powers, ensuring that the new borrowing regime is sustainable and securing further devolution in future.

As someone who favours devolution, I find all these moves very positive. It is very encouraging to see that agreement has been reached. It is also very helpful to have this Statement so that our debate this afternoon can be informed by the details of the agreement that has been reached. I share with the noble Lord, Lord Forsyth, some reservations about the general way in which the Bill has been dealt with, but in the past few days-in particular, thanks to the noble and learned Lord, Lord Wallace-we have been helped to make the debate better informed and more accessible.

Lord Stoddart of Swindon: My Lords, I will not interfere in Scottish matters; I would not dare. However, I have concerns about the business of the House and the way in which the House is being treated. Last Thursday the House sat until, I think, 10.38 pm.

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Last night it sat until 12.43 am. That is not good enough, particularly when Members of the House of Commons enjoy the privilege of going home very much earlier.

We in this House have repeatedly implored the Government not to bring forward so much legislation that is so badly produced that we have to spend a huge amount of time not only discussing the overload of legislation but correcting the many mistakes that have been made in the framing of that legislation. At the end of every Session, as far as I can remember, we have come up against the problem of time and important Bills have been rushed. The noble Lord, Lord Forsyth, and other noble Lords who spoke were absolutely right to express concern and to raise the matter of rushing through a very important constitutional Bill at the very end of a Session.

I intrude into the debate to express the hope that for the next Session the Government will recall what happened in this two-year Session. If they cannot get things right in a two-year Session, perhaps we may hope that they will reconsider their programme for the next Session to ensure that both Houses of Parliament can consider legislation at a proper pace and level without being kept here in the watches of the night, and that they will produce less legislation that is better prepared so that we can have a little more time to discuss Bills at leisure, at proper length and as deeply as necessary.

Lord Browne of Ladyton: The consideration of this Bill in Committee in this House has been peppered with expressions of frustration from all parts of the Committee at the way in which we have had to handle this business. I have already had my say in that regard, and I welcome the noble Lord, Lord Stoddart of Swindon, to the group of us who have had our say and have expressed how disappointed and, in some cases, angry people have been about what has happened. I do not intend to repeat what I have said in the past, which noble Lords who have heard me speak on this subject before will be pleased to hear.

However, I want to add myself to the list of those who will be shown in the record of today's proceedings as not criticising the noble and learned Lord, Lord Wallace of Tankerness, who has not been part of the problem but has been, with many of us, part of an attempt at a solution. I thank him for the fact that we have a Written Statement today, because in the normal timetable of the way in which these complicated matters have to be considered in government-and I know what they are-we would not have had a Written Statement, so he must have persuaded somebody who is fairly senior or fairly influential, which are not necessarily the same thing, to have it prepared for today. I think we are all grateful to him for doing that. I want to record how grateful we on these Benches-particularly the Front Bench but the Back Benches too-have been for the open and transparent way in which the Government and the Bill team have engaged with us on the progress of negotiations with the Scottish Government and in trying to find ways of dealing with these complex and difficult matters in a more efficient way.

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Since we last met in Committee, there have been two developments of significance. The noble Lord, Lord Forsyth, referred to both of them. As my noble friend Lord Foulkes suggested, they both raise some optimism for the future handling of the Bill, but they bring with them their challenges. The Written Statement reflects the outcome of the negotiations. I do not know about the noble Lord, Lord Forsyth, but I knew that a negotiation was going on, and I think that, on each occasion that he referred to it, the noble and learned Lord indicated that there would be some negotiated agreement that would potentially involve some change to the Bill, so I expected that.

In my darker moments, I anticipated perhaps greater changes to the Bill than there have been, but I am not entirely sure that we can appreciate the significance of the elements of the negotiation that relate to the financial provisions of the Bill without some significantly greater explanation from the Government and greater time for study of them. I was not aware that these particular negotiations were going on. They adopt into the way that Scotland's budget and the block grant will be adjusted following recommendations from the Holtham report. That report relates to the way in which the Welsh Assembly Government are funded. When I discovered that this morning, I downloaded the executive summary of the Holtham report. It is 72 pages. I do not think my printer would have enough ink in one cartridge to print the whole of the Holtham report.

I have tried to find in that executive summary exactly what this mechanism is and what its implications are. I suspect that I have not succeeded. I suggest to the noble and learned Lord that at some point soon, because we are running out of time, the Government either provide the House with a commitment that we will be given an adequate opportunity to scrutinise properly what amount to significant new details of the process of devolving tax and borrowing powers, or explain the mechanism for doing so, if it can be done in short.

4 pm

I say no more about that because I broadly welcome the other parts of the negotiation. The parts that are not to do with the financial elements of the Bill are remarkably close to proposals made by those on these Benches for amending the Bill, so we welcome and will support them. However, the bits that relate to the financial elements of the Bill are potentially very complicated. They may be very simple. If they are, they can be explained; if they are complicated, we need to find time because we all want to see this Bill pass in such a way that the legislative consent Motion that has now been agreed is of some consequence.

That element of the negotiations was not entirely in the control of the Government, and I understand that, because the enemy gets a voice, as it were, in these environments, and negotiations take as long as they have to take. They were constrained by the legislative timetable, but it was not guaranteed that they would conclude in time for us to be able to consider them properly. I have no criticism of anyone on the government side. They have reached an agreement, and I am pleased that they have. If it is a good agreement, I will support it.

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However, the other part of the understanding we have is exactly as the noble Lord, Lord Forsyth, explained it. We had a clear understanding that if we postponed, as we did, a discussion of the referendum elements of this Bill to 15 March, which was to be a week after the closure of the consultation, we would get a report on the conclusion of the consultation. This may not be parliamentary language, but because we were messed about we had to use 15 March for something else. Now it is 21 March, so the Government have had more time than they expected to formulate properly their response to the consultation.

I am delighted that the consultation appears overwhelmingly to support the Government's position. Since they consulted, in a White Paper fashion, on the proposal and got support for it, one would have thought that somewhere in the government machinery someone has some idea of what they are now going to do with that support. It would certainly be helpful if we could be told what that is as soon as possible. For example, if it involves the acceptance of the recommendation in paragraph 23 of Professor Tomkins' response to the consultation, which I think we all received copies of, to use the Bill to empower the Electoral Commission to start a consultation now about the content and drafting of the question, that is directly relevant to this Bill. However, it may include not that but other things, and there may be a process entirely outwith the Bill that will be the vehicle for taking forward the outcome of the consultation. It is going to be very difficult for us to have a meaningful discussion about these referendum amendments unless we know that.

In fact, if we knew what the Government were going to do, perhaps we could all go home early-having been here until 10.40 pm the other night, that would be a bonus-so some indication may facilitate the handling of the debate. None of us is interested-well, I may not be able to include everyone in this-in prolonging these matters any longer than necessary. I have done a lot, with the support of my Front-Bench and Back-Bench colleagues, to try to facilitate this Bill so that we can get it done in time and in good order. However, a few minutes spent now on indicating how the Government intend to take forward the outcome of the consultation, even if the noble and learned Lord is not in a position to say so in detail, might make the rest of the day much more productive and efficient for all of us. Of course, it might not.

Lord Wallace of Tankerness: My Lords, I think I might deal with the final comment made by the noble Lord, Lord Browne. I acknowledge the comments that have been made not just about this Bill but about the general timetable, but I hope that noble Lords who have taken part in our debates on many amendments to this Bill feel that we have had constructive debates. Almost without exception, the amendments that have been tabled have been pertinent and have done what this House does-properly scrutinise-and the Bill is the better for that. Although, as the noble Lord, Lord Stoddart, pointed out, we sat until 10.41 pm last Thursday, even in the final three-quarters of an hour we had some important debates. Although we had been sitting for some time, some important and thoughtful contributions were made.

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On the point about the Written Ministerial Statement paving the way to a legislative consent Motion, the noble Lord, Lord Browne, fairly described the situation as he understood it. When we debated this before moving into Committee last Thursday, I indicated to your Lordship' House, not for the first time, that work, negotiations and discussions were going on between the Scottish Government and the United Kingdom Government, and that we were hopeful that they would come to a conclusion. On that occasion, I think I said that I hoped that the House, before moving to Report, would have an outcome to these negotiations. I thought that it was important, if it was at all possible, for that Written Ministerial Statement to be available to your Lordships before we met today. I am pleased that in the event that proved to be possible.

There was an encouragingly wide response to the consultation. We received just under 3,000 responses, including many replies from members of the public living in Scotland and beyond. There were contributions from businesses, academics, political parties, trade unions and many others across civic Scotland. A number of these matters will be debated when we move into Committee, but I can confirm that the Government's key proposal in the consultation was that the referendum should be legal, fair and decisive.

In order to provide a legal referendum, we set out our view that a Section 30 order should be agreed to devolve to the Scottish Parliament the power to legislate for a referendum. Initial analysis of the responses indicates clear support for that proposal. A significant majority of those who responded to this issue agreed that powers to hold a referendum should be devolved to the Scottish Parliament. Of these, the great majority supported a Section 30 order.

However, analysis of any consultation is not just a simple matter of counting responses, so I am pleased that our preference for agreeing a Section 30 order was endorsed by a number of constitutional experts, including Matt Qvortrup, Adam Tomkins and Alan Trench, as well as knowledgeable organisations such as the Law Society of Scotland, the Royal Society of Edinburgh and the British Academy.

The fact that it is not just simply a numbers question was highlighted by the point made by the noble Lord, Lord Browne, who picked out a point in the response from Professor Tomkins on the Electoral Commission and the question. There were a number of substantially written points, although obviously not 3,000. We want to make sure that when we bring forward a report-my understanding is that because the original consultation was a command document, any report has to go through the process of becoming a Command Paper-we do proper justice to the quality of the responses that we received.

Obviously, we will be able to say more in the debates. Nevertheless, it is possible to give some clear indication as to where the balance of opinion lies in response to a number of the detailed points-for example, on whether there should be one question or two, and on the timing; clearly, considerably more people want it sooner rather than later-and to indicate some of the specific points made by a number of leading experts.

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I hear what my noble friend Lord Forsyth says about today's debate and any amendments that he might wish to table for Report. The noble Lords, Lord Foulkes and Lord Browne, have acknowledged that we have tried to structure a debate today on the referendums in a way that is to the benefit of the Committee. After the appropriate amendment has been moved, I wish to indicate the Government's position by saying something about the consultation. I shall then listen to comments from noble Lords and respond at the end of the debate.

Lord Forsyth of Drumlean: I am most grateful to my noble and learned friend. Given that Section 30 is the Government's preferred route forward, and given that the consultation process is overwhelmingly in support of that-that is what we are being told-is it the Government's intention to proceed on that basis? As that basis requires the agreement of the Scottish Parliament, is it my noble and learned friend's intention to bring forward some other Bill in the next Session of Parliament to deal with the referendum issue? It is clear that there will be no time to do this with the Scotland Bill.

Lord Wallace of Tankerness: My noble friend is right to say that a Section 30 order is the Government's preferred route and that it is our policy to negotiate an agreement to that end. However, by the very nature of a Section 30 order, it would not be done through primary legislation. Such an order requires the consent of both Houses of Parliament and the Scottish Parliament before being presented to Her Majesty as an Order in Council for approval. That position has received considerable support. I will certainly endeavour to see how many more of the numbers around that particular point can be put in the public domain so that they can be number-crunched before Monday. I will also ensure that my noble friend's comments on this are drawn to the attention of my honourable friend the Secretary of State. However, from what we have been able to digest, the clear majority of support in the consultation is for that process.

Lord Forsyth of Drumlean: I am most grateful to my noble and learned friend, but I am actually anxious to save the Committee time. If the position is that the Government are planning to proceed on the basis of a Section 30 order, having had the consultation, and if that needs to be negotiated with the Scottish Government, and if Report, which will be the last opportunity to table amendments, is taken on Monday and Wednesday of next week, then to all intents and purposes the possibility of using the Scotland Bill as a legislative vehicle to provide for an independence referendum that would be monitored and administered by the Electoral Commission with a single question has gone. The Minister appears to be saying that he will proceed on the basis of a Section 30 order, but if he is not successful in that, presumably another Bill will be required in the next Session of Parliament. Is that not right?

Lord Wallace of Tankerness: I ask my noble friend to forgive me if I have misunderstood or misinterpreted what he said. A Section 30 order can take into account

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issues such as the use of the Electoral Commission. It can also take timing into account, as it can on the matter of whether there is one question or more. These are the things that we will seek to negotiate in a Section 30 order.

Lord Foulkes of Cumnock: If we go down that route and there is an agreement between the Scottish Executive and the UK Government about a Section 30 order and it is brought forward, can the Minister confirm that it could be debated in both the Houses of this Parliament?

Lord Wallace of Tankerness: Indeed, not only would it be debated but it would be voted on in both the Houses of this Parliament. If we move into Committee, we can probably have a much wider debate on these matters.

The Duke of Montrose: My Lords, we are up against a slight hoolie on this procedure. The interesting Statement given to us by the Minister shows that quite a lot of the measures that are currently in the Bill have been withdrawn, so it is simplified from that point of view. The question then is whether what we are left with is purely a framework Bill into which all sorts of other legislation will be brought. However, from the point of view of this House, it would be a great shame if the legislation on the referendum were not set out in the Bill because there is a strong restraint on this place in that we never vote down secondary legislation, which is what will come before us if we use the Privy Council route.

4.15 pm

Lord Wallace of Tankerness: These are proper issues for debate. It is not the Government's intention to bring forward any amendment with regard to a referendum, as I shall make clear when we come to debate the matter, when issues such as those raised by my noble friend the Duke of Montrose and others can be more thoroughly aired.

I hear the points made by the noble Lord, Lord Browne, on the provisions of the Holtham model, and those made by my noble friend Lord Caithness on when certain issues might be debated on Report. In the spirit in which some of us discussed matters earlier this week to facilitate these debates, I am more than willing to convene a meeting-either in person or on the phone-to see how we can best order business on Report to meet the different needs in different parts of the House, to ensure proper debate on these issues and to see if there is a way in which we can further debate Holtham. I am happy to commit to write and provide additional detail ahead of Report stage to assist noble Lords. It may be useful if we have a dialogue to see how we might facilitate a proper discussion for Lordships on the so-called Holtham model.

With these reassurances, I hope the House will now resolve itself into Committee.

Lord Sewel: Part of the difficulty with the Section 30 route, of which I am in favour, is not merely that we do not vote against orders-except very occasionally-but

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also that we cannot amend them. That is a real difficulty. If there is a Section 30 order agreement but the House is profoundly disturbed about one aspect, it is the nuclear option to vote against it. That is a very uncomfortable position to be in. It would require almost a draft Section 30 Motion so that the House can express a view on the details before being forced to come to a decision, one way or the other, on the whole order.

Lord Wallace of Tankerness:I am not sure that a draft Section 30 order exists. However, the noble Lord, Lord Sewel, from his long experience in government, makes an interesting suggestion. The most I can do at the moment is to undertake to reflect on it.

It is not only the responses from the consultation, which will inform much of the content that the United Kingdom Government would wish to see in a Section 30 order, that is of considerable importance today in a debate on the referendum, it is also important to know what issues your Lordships think ought to be included in a Section 30 order. While I do not say that this is a part of the consultation, it is an important part of the process that we have an opportunity, facilitated by amendments tabled by noble Lords, for your Lordships to express views as to what you think should be in the order. I can guarantee that the United Kingdom Government will reflect on those views. I will be very surprised if there is too much difference between our preferences, as expressed in the consultation document.

It is important that noble Lords should take the opportunity today to express their views on what the shape of such a referendum should be and I suggest that we move on to that as soon as possible.

Motion agreed.

Clause 43 : Commencement

Amendment 74B

Moved by Lord Forsyth of Drumlean

74B: Clause 43, page 32, line 27, at end insert-

"( ) Section 28 shall not come into force until 60 days after the Secretary of State has laid before both Houses of Parliament a report on the impact of the provisions of that section on the financial privileges of the House of Commons."

Lord Forsyth of Drumlean: I am sorry that my noble friend Lord Sewel is not here. I beg your Lordships' pardon. I mean my noble friend Lord Sassoon. It was a Freudian slip. The noble Lord, Lord Sewel, will be forever associated in my mind with the Scotland Bill because he, of course, was the midwife of the legislation.

I am sorry that my noble friend Lord Sassoon is not with us because this amendment relates to the extraordinary revelations that we had at some stage during our 10-hour Sitting on Thursday about how the tax-raising powers of the Scottish Parliament would operate. I see that the noble Lord, Lord Kerr, is in his place. I have always held him in the highest regard. I first came across him when he used to guide us through UKREP in the European Union negotiations on the social chapter. He is not someone who is easily lost to detail. He expressed a surprise that I and lots of people

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felt. I am of course not a supporter but, as he indicated when we discussed this before, the whole idea of giving the Scottish Parliament a tax-raising power to set the Scottish income tax means that part of the block that has hitherto been determined by the Barnett formula would have to be raised in income tax. If the Scottish Parliament wished to raise more, it would have to raise the Scottish rate of income tax.

Lord Wallace of Tankerness: I might have got this wrong but is Amendment 74B not about the privileges of the House of Commons? At the moment, is my noble friend limbering up to speak to Amendment 74C? I apologise if I have got that wrong.

Lord Forsyth of Drumlean: My noble and learned friend is absolutely right. Amendment 74B is indeed about the impact on the privileges of the House of Commons. Everything that I said can relate to that if I think very carefully on my feet. Amendment 74B relates to the previous debate that we also had with my noble friend Lord Sassoon about enabling new taxes to be created in Scotland by Order in Council. That related to new Section 80B created in Clause 28, which is the power to add new, devolved taxes. It says:

"Her Majesty may by Order in Council amend this Part so as to ... specify, as an additional devolved tax, a tax of any description".

I cannot think of an example since ship-money where it has been possible by Order in Council to create a new tax. We have very particular procedures for creating new taxes. The Finance Bill right up until, I think, 1969 had to be considered on the Floor of the House of Commons in Committee. Special rules apply to the conduct of the Finance Bill, including-still, I think-that it is not subject to guillotine. The noble Lord, Lord McAvoy, would be able to help me with that. I certainly think that it is not subject to a guillotine in Committee. The Chancellor of the Exchequer has a leeway, given to no other Minister in the Government, to have as big a Bill and as much time as required. That is because the Finance Bill is central to the whole nature of Parliament, which is about voting and raising means of supply.

The particular innovation in this Bill enables a completely new tax to be created. Mr Alex Salmond might decide he wants a window tax or a tax on landed estates or our local income to finance local government. All that is required is that an Order in Council is approved by both Houses of Parliament. As has already been pointed out, Orders in Council are not normally able to be amended and are not normally voted against in this House. I am most grateful to my noble and learned friend for telling me which amendment I am speaking to. I have tabled this amendment because I cannot understand how, given the position of this House in respect of taxation, it can be right that first, new taxes can be created by order in the other place and, secondly, this House should be involved in consideration of the imposition of new taxes by order. That seems to impact upon the privileges of the House of Commons.

In truth, however, this amendment is simply another opportunity to raise a serious constitutional innovation, which creates very unfortunate precedents. I am hoping

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that even at this late stage I can impress upon my noble and learned friend that the explanation we were given for these powers being contained in the Bill, when we considered them earlier, was that the Calman commission had recommended that there should be powers in the Bill to provide for additional, specified taxes. This Bill does not provide for additional, specified taxes; it gives a completely open-ended power.

We have just received, as was referred to earlier, an indication of the agreement that has been made in order to get Alex Salmond's permission for this House to continue with the Bill. This is the deal that the Government have entered into. It provides for the inclusion of some new taxes-some of which we have already debated, such as the aggregates levy. Why can my noble and learned friend not amend the Bill on Report and make provision for those specified taxes to be included? I do not like the order-making power. He could put that provision into the Bill and it could be approved, then it would go back to the House of Commons and would be approved there. Why can we not have a list of specified taxes which are to be included rather than this open-ended and highly undesirable procedure, which I believe challenges the very basis of this House? I beg to move.

Lord Browne of Ladyton: My Lords, the amendment moved by the noble Lord, Lord Forsyth, seeks by very specific provision to restrict the operation of Section 28 of the Act. We on these Benches are broadly content with the Act, but the noble and learned Lord who speaks for the Government on these matters will, I hope, remember that we moved an amendment seeking to put into the Bill at least a mechanism, which would lead further into secondary legislation, to have some reflection of the criteria that need to be satisfied before either a new or an existing tax could be considered appropriate to be devolved. In response to that amendment, the Government's position was that those criteria were already set out in a White Paper predating the publication of the Bill.

Our position on these Benches is still similar to that of the noble Lord, Lord Forsyth. It would be better if there were some restriction in the operation of Section 28-or, at least, some shape to how it would operate-by reflecting through primary legislation into secondary legislation the criteria that need to be satisfied, since it appears that the Government have a clear and advanced view of what those criteria will be. This is an issue that we intended to return to on Report, having looked at the drafting of an appropriate amendment. I gave notice at the conclusion of the debate in Committee on Clause 28 that that is what we intended to do. To that extent, we are in agreement with the noble Lord, Lord Forsyth, and I think also with the mood of the House when we debated this provision.

Reflecting on the specific terms of the agreement with the Scottish Government, it appears that the Government's position on the aggregates levy is now that it will be devolved, as I understand it, not if but when the issues which are preventing its devolution are resolved. Up until now, I had thought that the conditionality in relation to the devolution of the aggregates levy was in the control of the European

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court. It now appears, though, that the Government's confidence that these issues can be resolved is such that they were able to agree with the Scottish Government that the aggregates levy will be devolved when that resolution takes place and these issues are resolved.

If that is the case then I agree, with regard to that tax, that it would be more appropriate to have in the Bill a provision that could be activated and brought into force at that point, and that this House and the other place would have an opportunity to consider the implications otherwise for the devolution of the aggregates levy in detail. When we debated that issue, if I remember correctly, the noble Lord, Lord Forsyth, proposed a detailed amendment covering the aggregates levy, and the noble Lord, Lord Sassoon, told him that technically it was broadly correct. I may be misquoting his exact words, but he said that the noble Lord had made a good job of it and that it was fit for purpose. If that is right, at least the Government are in a position where most of the work has been done. That may need to be tweaked, and I dare say that the Government would not want to accept someone else's amendment wholesale and may want to change it slightly, but we could be in a position on Report to have a debate that would do two things: satisfy this House's desire to have a debate about the detail of that tax and its devolutionary implications, and immediately show good faith to the Scottish Government because this would put a provision in the Bill that could be activated to devolve the tax.

I turn to the amendment. One of the coincidences of this amendment coming forward, or it may be not entirely a coincidence, is that this House has been exercised by the issue of financial privilege in some detail in committees, briefings, debates and discussion since the House of Commons recently claimed financial privilege in respect of Lords amendments to the Welfare Reform Bill. When I saw the amendment of the noble Lord, Lord Forsyth, I was not clear exactly what he was getting at, but there was no shortage of briefing available to me about financial privilege.

Lord Forsyth of Drumlean: I was simply trying to find a way of raising the subject again. There was no deeper meaning behind it.

Lord Browne of Ladyton: I do not know whether I am grateful to the noble Lord for that, because I had a very clever ending to this part of my contribution and he has prevented me moving towards it as quickly as I wanted to.

I have never been able to do this before in a debate: I intend to quote the Clerk of the Parliaments. There is a Library note on the issue of financial privilege; it goes into this issue in some detail, and only our Parliament could produce something like this that was so interesting and esoteric. Paragraph 18 of this report says:

"In conclusion, it may be worth making two points ... First, until the Commons asserts its privilege, the Lords is fully entitled to debate and agree to amendments with privilege implications".

It seems, and I am grateful for this, that this is the complete answer to the noble Lord's amendment. It would be ill advised of this House, given that it has that power, to seek for the first time to try to control it

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with legislation at its own hand. I cannot, as I am sure the noble Lord will be devastated to hear, support his amendment in these circumstances.

Lord Steel of Aikwood: My Lords, my noble friend Lord Forsyth has a technical point about taxation through Orders in Council, but I want to come back to this basic point regarding the Bill: Section 28 talks in bold type about the power to add new devolved taxes. That is something to which my noble friend is opposed; he does not want the Scottish Parliament to have the power to create more taxes, but I do. I think I am right in saying that the Calman commission also wanted to give the Scottish Parliament the power to add more taxes. Going back even to the referendum that we had, I know that my noble friend keeps saying that there is a difference between varying taxes and adding new ones, but that is too subtle a distinction.

Lord Forsyth of Drumlean: There are three members of the Calman commission here. I am sure that my noble friend Lord Selkirk of Douglas will be able to confirm this. I think the Calman commission said that the Scottish Parliament should have the power to add specified taxes. I am not against the Bill allowing for specified taxes; I am against it being open-ended and subject to that procedure.

Lord Steel of Aikwood: That is where we differ. I am not against the Scottish Parliament having such powers. I want the Bill to be stronger than it is. We are on a constant road on devolution. I still believe that we want to get to the point where the Scottish Parliament has responsibility for raising the money that it spends on devolved matters. The Bill does not go that far but at least it moves in that direction.

I give the Committee a specific example. My noble friend keeps talking about a window tax. Nobody in their right mind is contemplating introducing a window tax in Scotland; not even Mr Salmond has suggested that. However, we used to have a dog licence fee in this country. It was abolished some years ago because it reduced to 37.5p. It was collected by local authorities and it cost so much to collect that it was not worth having.

Lord Forsyth of Drumlean: That was not a tax.

Lord Steel of Aikwood: My noble friend mutters that it was not a tax. However, I am saying that it could be a tax. There is no reason why the Scottish Parliament should not decide, as a matter of good policy, that ownership of dogs, which can be a confounded nuisance in cities and the countryside, should be subject to tax. That is a perfectly sensible proposition and there is no reason why the Scottish Parliament should not decide that it is one way of adding to its tax take and finances. I am totally opposed to the amendment that my noble friend is pursuing. He is making a good case by trying to undermine the basic purpose of the Bill, while I want the Bill to go further than it does.

Lord Lyell: My noble friend made a powerful speech; indeed, I am half way to agreeing with him. However, our noble friend the Commercial Secretary to the Treasury referred 36 times to this extraordinary Scottish dance, the close connection; perhaps my noble and

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learned friend on the Front Bench can tell us whether it is a Canadian barn dance, a military two-step or a three-step. That close connection refers particularly to individual payers of income tax. In describing this close connection, my noble friend admitted more than 30 times that the individual payers who are classified as Scottish taxpayers would be nothing to do with this Bill. They could easily be English or other UK taxpayers. I hope my noble friend will take that on board. You can look at new taxes but, for goodness' sake, take care over who will be responsible. If they are not Scottish taxpayers or Scottish voters, we will be in ever deeper water.

Lord Wallace of Tankerness: My Lords, my noble friend Lord Forsyth indicated that this amendment was a hook on which to hang a wider debate. I listened to the debate on Clause 28, to which my noble friend Lord Sassoon responded and in which the noble Lord, Lord Forsyth, made a number of points. He raised the responsibilities and privileges of the respective Houses of Parliament. The noble Lord, Lord Browne, has given a very clear answer on that. It is also important to point out that our role is in relation to a constitutional question: should the Scottish Parliament have responsibility for a particular tax, or should it remain reserved? It is not about how a tax should be structured, who should have to pay it and exemptions to it. That would all have to be set out in primary legislation by the Scottish Parliament, should a tax be devolved.

I am sure it is accepted on all sides of the House that the question of what should be devolved to the Scottish Parliament is an important constitutional issue. I rather think that if it had been suggested that the House of Lords should not express a view on a power such as that contained in Clause 28, I might be in greater difficulty in trying to respond to an amendment suggesting that it should. However, I hear what my noble friend says about the tax in relation to Clause 28. I do not want to engage in a rerun of the debate that we had when my noble friend Lord Sassoon was responding, or indeed anticipate a debate which the noble Lord, Lord Browne, has indicated he intends to run when we come to Report. I am sure that there will be ample opportunity to do so.

I say to my noble friend Lord Forsyth that I think there is a genuine misunderstanding between us with regard to what the Calman commission meant when it referred to a specific tax. I think there are three other members of the Calman commission in the Chamber at the moment and I am sure that, if I have this wrong, they will jump up. The Calman commission identified some specific taxes such as an aggregates levy, which has been referred to, air passenger duty, landfill tax and stamp duty land tax. These were specified and specific recommendations were made in respect of them. Paragraphs 3.170 and 3.171 of the Calman commission report give a general background as to why we thought there should be a power to devolve other specific taxes in the future. By that, it was not intended that we should nominate in the commission's report, or indeed in a Bill, what these specific taxes might be; rather, it concerned the concept of a specific tax as opposed to devolving a general power of taxation to the Scottish

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Parliament. I think there is perhaps a genuine misunderstanding on what the recommendation intended. I may have a better understanding of what that intention was, having been party to it.

Lord Forsyth of Drumlean: Can my noble and learned friend give us two examples of taxes that might be added using this general power which he could not put on the face of the Bill?

Lord Wallace of Tankerness: My Lords, the point of not putting that on the face of the Bill is to make sure that there is provision for something that might happen in the future. However, one possible tax could be a dog licence tax, which my noble friend Lord Steel mentioned. I wish to make it very clear that it is not the policy of Her Majesty's Government to have a dog licence tax, nor indeed, the last time I checked, was it the policy of the Scottish Liberal Democrats. I hope I will not embarrass my noble friend Lord Steel by what I am about to say but I remember that, in an election when I was leader of the Scottish Liberal Democrats-it must have been the 1999 Scottish election-and my noble friend was a candidate in Lothian, he announced somewhere along the line that he wanted a caravan tax. I had to spend a whole day making it very clear that this was his personal view and not the view of the party. My noble friend seems to be a rich source of potential taxes.

However, one of the taxes that the Calman commission considered was a plastic bag tax, which had arisen in the Scottish Parliament where all sorts of ways had been found to try to see whether it could be brought within competence. That is the context. I hope that before we come back to this matter on Report, my noble friend will look at paragraphs 3.170 and 3.171 and will understand the context in which the recommendation was made.

I may be anticipating the debate we will have next week, but putting criteria on the face of the Bill would undoubtedly give the courts the ability to decide whether they have been met. The question of the extent to which these criteria have been met is, I believe, a political one, and one which Government and Parliament would be best placed to determine when a particular issue presents itself. However, it is clear that we will have an opportunity to return to this so I will not detain your Lordships further. I invite my noble friend to withdraw the amendment.

Lord Forsyth of Drumlean: I have to say to my noble and learned friend that that was a disappointing response. I thought that if I gave him the chance to discuss this important constitutional position again, having thought about the arguments, he would perhaps say that he would narrow the rather wide focus of the Bill. I wonder how the House would react if my right honourable friend's Budget was implemented with a Finance Bill which said that it would be possible to introduce new taxes by Order in Council, approved by both Houses of Parliament. I think there would be an absolute stampede, yet that is what we are proposing should happen to people in Scotland. Having praised

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my noble and learned friend, I think that he is just a little bit flippant about this. The reason I brought this issue back was not to waste the time of the House but to underline that something very important is being done here which, as I have said, breaches a principle established in this country after ship money.

4.45 pm

I hope that my noble friend Lord Steel is right, because I can think of nothing that would sweep Alex Salmond from power more quickly than announcing that he was going to put a tax on dogs-

Lord Steel of Aikwood: And caravans.

Lord Forsyth of Drumlean: And caravans. I do not want to detain the House, but I know that my noble friend Lord Steel got into some difficulty with dogs when he gave the former President Ceausescu a puppy dog following a state visit in 1974. My noble friend gave one of his puppies to Ceausescu. When they had gone shooting, the birds were recovered by children, so my noble friend sent one of his fine Labradors to Ceausescu. Many years later, when the regime collapsed and the press arrived, my noble friend received a call from an outraged journalist who asked, "Did you give this dreadful dictator a dog?". My noble friend explained that he had done so as a result of a state visit and that it had been a courteous thing to do. The journalist said, "Did you realise that this dog had its own coach, its own servants and a whole palace to live in?". I say to my noble friend that dogs, politics and tax are best not mixed.

My noble friend suggested a tax on plastic bags. The mind boggles as to how large firms such as Tesco and others would operate if there were different taxes on plastic bags north and south of the border.

Lord Wigley: Is the noble Lord aware that there is a plastic bag tax in Wales?

Lord Forsyth of Drumlean: I rest my case. I was not aware that there was a tax on plastic bags there, but if it is thought to be appropriate to have a power to introduce such a tax, it should be specified in the Bill-not as part of a general power. However, I can see that I am making no progress on this and I therefore beg leave to withdraw the amendment.

Amendment 74B withdrawn.

Amendment 74C

Moved by Lord Forsyth of Drumlean

74C: Clause 43, page 32, line 27, at end insert-

"(1A) Notwithstanding any other provision of this section, no provision of section 30 shall come into force until the provisions of that section have been approved in a referendum held in England."

Lord Forsyth of Drumlean: My Lords, this is the amendment that I was speaking to previously. It is a device that provides for a referendum in England on Scottish income tax powers. I tabled the amendment

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in order to discuss the letter that my noble friend Lord Sassoon circulated, following our debate on the Bill on 15 March.

I suggest that the English should have a say on this because of the extraordinary revelation in Committee on the position of the Scottish Parliament if a change in taxation policy were to be introduced by the Chancellor of the Exchequer-as has happened today, for example, when he raised to just over £9,000 the allowance before people pay income tax. The no-detriment principle is not in the Bill but has, as I understand it, been agreed between the Government and the Scottish Government, or has been proposed as part of the arrangements. I see that in the Written Statement today concerning the negotiations on legislative consent-which we can debate at a later stage-those arrangements go even further.

The idea is that Scotland would benefit from the reduction in income tax that people paid as a result of the increase in allowances, but that England would send a cheque to compensate for the reduction in the tax revenues in addition. The argument for having the 10p tax is that it will affect only a small proportion-by the way, Ministers keep saying that it is 30 per cent; I think we were told today the precise figure by the Office for Budget Responsibility. Hitherto, the assumption has been that about £4.5 billion would be raised by the 10p rate of income tax and that if the Scottish Parliament wanted to spend more it could put that income tax up. The proposition that, because the 10p rate does not raise £4.5 billion any more because people in Scotland are paying less tax, people in England should have to pay more tax to send an addition to the Barnett formula-determined part of the block seems to me to drive a coach and horses through the whole argument of accountability.

If my amendment were accepted and the proposition was put to people in England by a referendum that the Scottish tax powers should operate in that way, I think that there would be an overwhelming rejection, because it is completely unfair and unworkable and will create great difficulty.

In his letter to me, which has been circulated to Members of the Committee, the noble Lord, Lord Sassoon, goes on to deal with another issue, which is benefits. If, as has happened today, the Chancellor raises the thresholds at which people pay tax, that means that there will be a change in their entitlement to benefit. There is a requirement here for changes in people's eligibility for benefit and the effect that that has in Scotland to be compensated for by taxpayers in England. In his letter, my noble friend says that I should not be too worried about that because the costs are likely to be low. I hope that this letter will be put in the Library or in a form which people outside the House can access.

In the annexe to the letter, my noble friend sets out a little flowchart, which starts with the Scottish budget being £28 billion and Scottish income tax receipts being £4.8 billion. Then, the Scottish block is adjusted downwards by £4.8 billion to create headroom for the Scottish rate of income tax, which means that the Scottish budget is £28 billion, and the block grant is £23 billion because the Scottish income tax receipts

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would be £4.8 billion. The UK Government raise the personal allowance UK-wide, estimated by the OBR at £3.5 billion. The OBR forecast of the impact on Scottish income tax receipts is a reduction of £100 million. Therefore, receipts from the Scottish income tax are expected to be reduced to £4.7 billion. Therefore, the Treasury adds £100 million to the Scottish budget to offset the impact of what is called UK policy change and the outcome is that the Scottish Government's budget remains the same.

This is "Heads you win, tails you win" economics. It is completely unfair. It is just reinstating the block grant. I am no advocate of this policy, but if the Government want to go down this track the sensible thing to do would be to give the Scottish Parliament control over the allowances and the rates. This is nonsense. It also applies to changes in the benefit position, because people's entitlement to benefit will be altered by their net income. If the Scottish Parliament were to put up tax, which it will certainly have to do, and Scotland becomes the highest-taxed part of the United Kingdom, as it certainly will, that means that people's entitlement to benefit will increase. The cost of that will fall on the English taxpayer. I raise this because, if my noble friend accepts my amendment, which is to give the people in England a referendum on this scheme, I do not think these proposals will stand the test of time. If, as I suspect, he will not accept my amendment, then I urge him to abandon this ridiculous no-detriment principle. The no-detriment principle is a no-accountability principle. It drives a coach and horses through the whole philosophy and thinking of the Bill. I have no idea where it came from. If he is going to maintain this no-detriment principle, then it ought to be written on the face of the Bill. It should not be the product of a quiet deal that no one knows anything about, which flies in the face of what was said in the manifestos of those parties that committed themselves to introducing the Calman proposals. I beg to move.

Lord Kerr of Kinlochard: My Lords, it is déjà vu all over again. I supported the noble Lord, Lord Forsyth, the last time he raised the matter. Although I do not agree with this amendment, I am very glad he has moved it, because it enables us to discuss it again. I had not understood the no-detriment principle. It was painstakingly explained to me by the Minister and the noble Lord, Lord Sassoon. I have not been favoured with the letter of the noble Lord, Lord Sassoon, so forgive me if I am behind with the debate. As it was explained, it is indeed exactly as the noble Lord, Lord Forsyth, says. However, look at it the other way round. It would be paradoxical if the basic tranche of income tax, before the Scottish tax is added in on top, was reduced. The Scots would receive a cheque from the United Kingdom Exchequer. That seems to be very odd. However it is politically even odder, and possibly unsustainable, if it is the other way around. Supposing Chancellor Balls had decided that we needed a higher level of spending, and therefore a higher level of taxation. The Scots would have to send a cheque and they would have paid the higher level of taxation, so would have had less to devote to the higher spending which the proceeds of the tax would have brought in. I do not understand this no-detriment principle.

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I draw from that unsatisfactory example exactly the opposite conclusion from the one the noble Lord, Lord Forsyth, draws. I go with the noble Lord, Lord Steel of Aikwood. It seems that we need more but I apologise to the noble Lord, Lord Forsyth, as he was saying much the same today. The trouble with this Bill is that it is a Sir Clive Bossom Bill. Sir Clive Bossom calls on the leader of his party, then the leader of the Opposition, when he joins the House of Commons. The only sentence he gets out of Mr Churchill is, "Bossom, eh? Neither one thing nor the other". That is what is wrong with this Bill. It is not actually devolving real accountable taxing authority to the Scots. It is still the block grant system with a little add-on which is presentational rather than substantive. I would much rather see a genuine devolution of taxing power. I would start with indirect taxes. Then you will not have any of the problems of defining who the taxpayer is, residence and so on. I would start at that end. I would concede from this Parliament to the Parliament in Edinburgh much greater power in order to deal with the real deficit, which is the accountability deficit. I accept that as a consequence of that, one would have to have a rather strict control on the macroeconomic effect of a degree of fiscal autonomy, so that we did not see a repetition of what we see in continental Europe right now. I accept that that follows.

However, it would be better to get into that area than to pretend to do devolution of taxation and end up with this rather miserable little measure. I understand its logic; I used to work in the Treasury. It is the logic of the Treasury office of accounts. It is the logic of the public expenditure side of the Treasury. It is a book-keeping logic. However, if you think of its economic effect-if you think of it in economic terms-it is absurd.

5 pm

The Earl of Caithness: My Lords, I support what has been said so far. The present situation, as is increasingly becoming clear, is untenable. It goes against the principle that I have been arguing all the way along. I am in agreement with the noble Lords, Lord Foulkes of Cumnock and Lord Steel of Aikwood. I believe that the only sensible way for the Scottish MSPs to be accountable is for them to be able to raise revenue as well as spend it. We are prohibiting that accountability and to me that is a very serious mistake which needs to be corrected at a later stage of the Bill. I think it is untenable for the future and unless we nip this in the bud now, it will be of increasing concern and will lead to a distortion of some of the benefits of devolution. It will become a real Achilles' heel for people. Every time there is a change of allowances in one country that is different from another, we will have these consequences. Now that we know exactly what will happen, we have a real problem ahead of us.

Lord Lyell: Perhaps I may put a gloss on what my noble friend has said about these taxes. He refers to accountability. I make the point that in Clause 30 of the Bill, let alone anywhere else, there is no accountability to English, non-Scottish voters, who will be classified by the Bill as Scottish taxpayers. Where is the accountability? It is not there.

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Lord Browne of Ladyton: My Lords, I do not support the noble Lord's amendment. In case anyone should be in any doubt about this, I do not support a referendum on any aspect of this Bill because I do not think that it is appropriate for us to make any of the provisions of the Bill conditional on a referendum, either by the Scots, the whole of the UK or indeed the English. I shall perhaps have an opportunity to explain later that referendums are for extraordinary circumstances and this is not one of those sets of circumstances.

Secondly, in this context, I would never support a referendum by the people of England in any event because, in my view, that would be a fundamental misunderstanding of the concept of devolution. Devolution depends on the relationship between the United Kingdom and Scotland and not between England and Scotland. I am not being pedantic; I could go on to say why England, and not Wales and Northern Ireland. The noble Lord nods so I am sure that he gets the point. This is a vehicle for him to have a wider and broader debate and I understand that. It is important that we do not repeatedly categorise these issues as issues between England and Scotland. This is about devolving power to a part of the United Kingdom and holding that part of the United Kingdom in the United Kingdom. We have done it to Northern Ireland and to Wales and we have done it substantially to London in many aspects of public policy.

It is challenging and difficult for this Parliament and for people to understand because it is utterly asymmetric across the country, but, in my view, it is a celebration of the diversity of the United Kingdom. I know that there are those among us-the noble Lord, Lord Steel, is one of them-who would like to see a more federal structure where there was less of an asymmetry and much greater clarity. However, the reality is that many parts of the United Kingdom are not ready for that, as they have made clear to us, and it should not be imposed upon them. Ironically, in the history of devolution in Spain, that sort of structure was imposed on the Spaniards and those who were least interested in it made the most out of it. I say that in passing. So I do not support a referendum. I would certainly not support a referendum by only English voters.

I turn to the no-detriment principle. I thank the noble Lord for raising this issue again. In the absence of my noble and learned friend Lord Davidson of Glen Clova, who is part of our Treasury team and is also a Scottish affairs spokesman, I have to deal with it. I was reluctant to engage myself in the debate the last time it came up, but got slightly frustrated with the misrepresentation of what I thought was the no-detriment principle. I stuck my nose into it, suggesting, indeed, that this letter be written, but it appears that the letter has just given those who wish to misrepresent the no-detriment principle even more ammunition to do it.

The no-detriment principle in this context was first raised, as I understand it, in the Command Paper that accompanied the Bill. My understanding of the no-detriment principle is probably best expressed, interestingly enough, in a paragraph of the Holtham report. This may be entirely the wrong part of the

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Holtham report for the purpose of the agreement that has now incorporated this into mechanisms for the future between the Scottish Government and the UK Government, but it does what I want it to do. It is paragraph 5.2 of the substantial executive summary of the Holtham report. The executive summary is 72 pages long. I shudder to think what the whole report is like, and I certainly do not intend to spend a weekend between now and the Report stage reading it.

If I have understood the Written Statement from the Secretary of State for Scotland, the principle of no-detriment is now to be qualified by reference to the Holtham report and the mechanism in it about budgets and block grants. If I have misunderstood that entirely then, at the risk of encouraging the same sort of pantomime that we saw earlier in another place, perhaps someone on the Front Benches could either nod or shake their head, but if I am right this encapsulates the no-detriment principle:

"Risks consequent on the actions of the Assembly Government should be borne by its budget and risks consequent on the action of the UK Government should be borne by UK budgets. Risks outside government control and arising from elsewhere should be pooled across the union".

It goes on to refer to how difficult that is to do. I accept that it is very difficult, but as I understand it, that is what lay behind the no-detriment principle. If Holtham is now to be incorporated into that agreement, then that may make it easier.

If that is right, with all due respect to the noble Lords who have supported this interpretation, adjusting the block grant for Scotland in response to policy decisions made by the UK Government in no way undermines the accountability of the Scottish Parliament or the Scottish Government. They are accountable for what they do. The point about the no-detriment principle is that they should not be accountable to their electorate for what the UK Government do. We can call it what we like, but that is essentially what this is trying to achieve.

I see the noble Lord moving in his seat. This is what I fear, of course, when I start to get into this area of complexity. Before I allow the noble Lord to intervene, perhaps I may remind the Committee that when we were discussing the developments before we started on the fifth day of Committee I said at the outset that it would be extremely helpful if, between now and the conclusion of the debates on the Bill, the Government set themselves the task of explaining where we are now in relation to this principle and how it works. It may be that the noble Lord, Lord Forsyth, will never be satisfied that accountability should be encapsulated only in the actions of the Scottish Parliament. He has a very distinctive view about the Bill and about the Parliament's relationship with the rest of the United Kingdom, which few of us share. However, some of us could be satisfied that there might be a way of expressing this with greater clarity than it has been, and perhaps also of incorporating it into part of the Bill before it is beyond amendment so that it becomes clearer than it is at present.

It now appears that we have not only to read a Command Paper but be sufficiently familiar with the details of the negotiations between the Scottish and

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UK Governments and no doubt adept at finding our way around the full version of the Holtham report to understand how the no-detriment principle will work. I prefer the simple statement in paragraph 5.2. If that is what the Government are about, I support them. If they could find a way of making that clear in a way that we could refer to in future to ensure that that is what will happen when people adjust grants, I would support them even more. I look to the noble and learned Lord, who has not until now dealt with these financial provisions-neither have I-to reassure the House that in the near future there is a mechanism that will allow us to do that.

Lord Wallace of Tankerness: My Lords, I am in a position similar to that of the noble Lord, Lord Browne, in having to deal with matters that hitherto were dealt with by my noble friend in the Treasury. I fully accept that my noble friend's amendment is a hook. I share the view expressed by the noble Lord, Lord Browne-

Lord Foulkes of Cumnock: Perhaps I may take the opportunity of sending good wishes to the noble Lord, Lord Sassoon, for a speedy recovery.

Lord Wallace of Tankerness: I hope that I did not imply that he was ill. I am not aware that he is.

Lord Foulkes of Cumnock: I assumed that he had retired hurt.

Lord Wallace of Tankerness: I am sure that, after all the good will that has been expressed, he will relish coming back to the fray next week. I do not for a moment think that he is ill; perhaps I may quash that rumour.

As the noble Lord, Lord Browne, indicated-and perhaps my noble friend Lord Forsyth would accept-to include only the people of England and to exclude the people of Wales, Northern Ireland and Scotland would not be appropriate. We should bear in mind that the proposals in the Bill were in the manifestos of the Conservative, Labour and Liberal Democrat parties, which applied throughout Great Britain at the last election. My noble friend indicated that he wished to return to the issue of the no-detriment principle, which he pursued on Thursday of last week. It prompted my noble friend Lord Sassoon to write a letter. My noble friend asked if it could be put in the Library. I will make sure that that is done, because it has the benefit of a flow chart that I could not begin to describe from the Dispatch Box.

I will try to explain-I accept that I will not necessarily succeed-what the no-detriment principle is about and why we believe that it is fair and does not detract from accountability. I agree with the noble Lord, Lord Kerr of Kinlochard, and with my noble friend Lord Caithness that more accountability is crucial and that the Scottish Parliament should be accountable not simply for spending money but for raising it. My starting point is that it is wrong to suggest that the no-detriment principle is about allowing the Scottish Government to have their cake and eat it.

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The first flaw in the argument is to suggest that if there is a tax benefit-for example, through the measure in today's Budget to raise the personal allowance, which I very much welcome-it will accrue to the Scottish Government. It will accrue to Scottish taxpayers, along with those of England, Wales and Northern Ireland. As I will seek to explain, it has an effect on the revenue that would then be generated for the Scottish Government.

5.15 pm

Lord Forsyth of Drumlean: Yes, it does. The effect is that the amount of tax that people pay in Scotland will go down. Therefore, if the Scottish Parliament wished to be compensated for the loss, it would put up the tax so that it remained in the same position.

Lord Wallace of Tankerness: This is where there is a misunderstanding. This is about making a shared tax base work in a way that is fair and revenue neutral to both jurisdictions. My noble friend Lord Caithness said that if the Scottish Parliament chose to change the allowances, it should bear the responsibility. The whole point of these proposals is that it cannot change the allowances. The personal allowance is determined by the United Kingdom Government. That is the nature of a shared tax base. The argument is that if that tax base is changed, there ought not to be detriment to the Scottish Parliament.

Lord Kerr of Kinlochard: Let us look at this the other way around and think about the ease and the political acceptability in Scotland of making the case that if the Chancellor decides to put taxes up, not down, the Scots, in addition to paying the taxes, should send a cheque to London. It is the reverse of the case that the noble and learned Lord has just been discussing.

Lord Wallace of Tankerness: It is very unlikely to happen, but let us say that the personal allowance had gone down rather than up. It would have been a windfall to the Scottish Government. The argument therefore is that on a no-detriment principle, it should operate both ways. I shall come on to explain that.

I shall try to make this as simple as possible, but it is not readily simple. From April 2016, the income tax base in the United Kingdom will be shared between the United Kingdom and Scotland. With 10p from all rates in Scotland expected to yield between £4.3 billion and £5.6 billion over the OBR's forecast period, the Scottish Government will receive around 3 per cent of UK income tax receipts. The Scottish Government will be responsible for setting their rate of income tax and the United Kingdom Government will be responsible for everything else, including, for example, personal allowances. In such a system, the UK Government must be accountable for decisions that they take on the structure of the tax. Conversely, the Scottish Government must be accountable for the decisions that they take in respect of the rate.

I shall give an example-the example seen in the letter from my noble friend Lord Sassoon, but seen the other way. Last year the United Kingdom Government

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decided to raise personal allowances from £6,475 to £7,475. This decision cost the United Kingdom Government approximately £3.5 billion across the United Kingdom. Since the proposal in the Bill is to devolve around 3 per cent of income tax, the cost to the UK Exchequer from raising personal allowances would reduce to 97 per cent per cent or around £3.4 billion. The remaining £100 million would fall on the Scottish budget. It would be a cost as a result of a decision for which the Scottish Government were not accountable.

If the Scottish Government had set a budget and a rate of tax and had planned their public expenditure on that basis, and then, some four or five months later, as the result of a decision for which they had no responsibility or accountability, they suddenly found that their budget was £100 million short, the no-detriment principle is intended to make up that difference because it is a decision for which the Scottish Parliament will not have had responsibility. That is why I believe that it is important for accountability, because not to do so means that suddenly a Scottish Government perhaps have to carry the can for particular expenditure to which they were committed but could not longer afford, not through any decision that they had made, but through a decision made by the United Kingdom. The obverse is true; for example, if the Scottish Government get a windfall because the tax base has changed, it is only right that that windfall is recovered by the United Kingdom Government.

Under the no-detriment principle, the UK Government would compensate the Scottish budget for any cost that led to a reduction in the tax, but at the end of the day the cost to the United Kingdom is exactly the same as it would be if this Bill were not implemented-that is, the £3.4 billion that it loses in revenue because of the increase in the personal allowance and the £100 million that it then gives to the Scottish Government.

Lord Forsyth of Drumlean: I am sorry to persist in this; perhaps I am just being thick. To take the example given by the Minister, which is the same example that I tried to give from the flow chart, if the Scottish Government find that their block grant is short of £100 million as a result of the increase in the allowances, that means that the amount that people are paying in tax in Scotland has gone down. Why can the Scottish Government not just use their tax-raising power to get the £100 million back from the people who have benefited? That is how the model is supposed to work.

If the Minister is not happy with that, why does he not go further and give the Scottish Parliament the ability to change the allowances as well as the rates? In those circumstances, if the Chancellor wishes to raise the allowances and the Scottish Government do not, they do not raise the allowances. I am making the case here for more devolution, not less-not on the grounds that I am committed to more devolution but on the grounds that this is a complete dog's breakfast.

Lord Wallace of Tankerness: My Lords, I cannot accept that last comment, but I can now see where my noble friend is coming from. I welcome anyone who wishes to express the case for going further. Of course, he is well aware that what has been presented to Parliament here is something that was worked on over

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a long period of time during which a consensus was achieved. There was never likely to be a consensus in favour of devolution of the whole tax base, as opposed to the tax rate.

My noble friend is basically saying that it should never be the case that a change in the tax base-for example, the increase in personal allowances-should benefit taxpayers in Scotland. He is saying that if the UK Government, who are still responsible for a substantial level of services in Scotland, take tax from the Scottish people, the Scottish people should never be allowed to take the kind of benefit that I believe they should-and I think that he once wrote a pamphlet on the benefit of raising the personal threshold-and the Scottish Parliament should raise its rate of tax to account for that. That is not accountability; that is a decision taken by the UK Government to bring benefits right throughout the United Kingdom.

It would seriously undermine the United Kingdom if Scottish taxpayers were not allowed to receive the benefit of a change to the UK tax base. It could mean that the tax change would reduce the amount of money available to the Scottish Government, so that budgetary considerations and calculations that had been put forward and might well have been voted through by Parliament would no longer be sustainable because of a decision taken by a body other than the Scottish Parliament. That is the essence of the no-detriment rule, and something that lies at the heart of the statement of funding policy.

I will read out the statement of funding policy, because the noble Lord, Lord Browne, might find that it echoes the passage from the Holtham commission that he read out. It says:

"Where decisions taken by any of the devolved administrations ... have financial implications for departments or agencies of the United Kingdom Government or, alternatively, decisions of United Kingdom departments or agencies lead to additional costs for any of the devolved administrations ... the body whose decision leads to the additional cost will meet that cost".

That is where accountability properly lies.

This is not something new that has suddenly been dreamt up. There are probably people in the House who were involved at the beginning of devolution and this principle has been in the statement of funding policy since then. I believe that it is fair that Governments -be it a UK Government or a Scottish Government-should be accountable for the decisions that they make, but they should not be able to export some of the implications of their decisions on to another Government, who should not be held accountable for the decision of another Government.

Lord Kerr of Kinlochard: I understand the Minister's logic, which seems to depend on the control total being the block grant. The block grant is what matters. All this stuff about tax is for perception and presentation at the edges. The block grant has to be maintained. Apparently the example in the Sassoon letter, which I have not seen, concerns a case where the Scottish economy would have benefited from the additional buoyancy and spending power of a reduction in the level of taxation paid by Scotland. However, because we are seeing everything through the prism that the block grant is the control, it needs to be maintained in

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Scotland, so the Scots need to be compensated for the additional buoyancy in the Scottish economy. That is quite difficult politically. The reverse case, which the Minister prefers not to talk about, is almost impossible to present politically in Scotland.

The trouble is that these tax revisions are neither fish nor fowl; they are only a good red herring. We are not addressing the real issue on taxation. I entirely agree with the noble Lord, Lord Browne of Ladyton, that accountability is accountability for spending and for raising the money which you spend. Until we get that and get away from having the block grant as the control, we will have a continuing unsatisfactory situation.

Lord Wallace of Tankerness: My Lords, I certainly agree with the final point that accountability is as much about what you raise as what you spend. The point at the heart of the statement on funding and the no-detriment principle is that one should not be accountable for consequences which you as a Government would have to see through but which are the result of a decision that you have not made. Having to say why a certain project does not take place-following not a decision that you have made but a decision made by another Government-is not accountability. That is what one is seeking to address, and it links in with what has been said about the Holtham principle. Again, there is an intention there that, if the Scottish Government's tax proposals promote buoyancy in the Scottish economy, that should be to the benefit. Likewise, if they have tax proposals which have an opposite effect-they drive away enterprise and reduce revenues-there should be a negative consequence. A letter is not necessarily the best way to go through this issue but I am certainly open to ways in which we can go through it in more detail. This point links to the Holtham point made earlier by the noble Lord, Lord Browne.

The principal point is that this is not an issue of the Scottish Government getting two bites of the cake. It is to ensure that where a tax decision is made regarding the UK tax base by the UK Government, all taxpayers throughout the United Kingdom are treated in the same way as a result of that decision. It means, too, that if that decision has consequences-either inflating the money coming into the Scottish Government or reducing it-a rectifying amount is paid back or perhaps withheld from the block grant or, alternatively, is paid in addition. I regret that it is not the easiest thing to explain and there may be another way of discussing it other than across a Chamber. However, I emphasise that it is not a question of having your cake and eating it; ultimately, it is a question of ensuring accountability and making sure that the Scottish Government do not become accountable for a decision that is not their own. I cannot put it more simply than that. Although we may well return to this issue, on that basis I ask my noble friend to withdraw his amendment.

5.30 pm

Lord Forsyth of Drumlean: My Lords, I have to say that I think this is a complete dog's breakfast and I agree entirely with the noble Lord, Lord Kerr of Kinlochard. My noble and learned friend has struggled valiantly to try to explain why the Scottish Parliament

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should not be accountable for a decision made by the Chancellor to change the tax base by altering the allowances. However, he has not dealt with the point made by the noble Lord, Lord Kerr of Kinlochard, about the politics of Scotland having to send a cheque to England, but I thought I would keep off that in case-

Lord Wallace of Tankerness: I hope that I made it clear in my response but I shall repeat the point. This is reciprocal because it goes two ways. If a change to the tax base led to an increase or windfall for the Scottish Parliament, that would be recoverable-not by England but by the United Kingdom Parliament.

Lord Forsyth of Drumlean: Indeed, and I understand that, but I am talking about the politics of it in the context of there perhaps being a higher rate of tax in Scotland. I would not like to be the Minister who had to explain why it was necessary. For example-thank goodness the Chancellor did not do it-let us suppose he had abolished tax relief on higher-income pension contributions. That would create exactly the kind of situation under this odd regime in which the Scottish Government would have to send a cheque to England. My noble and learned friend looks quizzical and perhaps I am wrong, but if the tax relief were removed there would be a windfall benefit for the Scottish Government. The product of a 10p income tax would be less, or are we saying that this would apply only to direct changes to allowances in respect of income tax? If that is the case, surely it would be sensible to allow the Scottish Government to make changes to tax allowances rather than compensate them for the effect of changes. There is an idea that they would be caught midway through a Budget by a sudden change-perhaps the £100 million example given by my noble friend-but, as we have seen today in the reduction in the top rate of tax or the increases in allowances, these are normally planned well in advance. Provision is also made in the Bill for the Scottish Parliament to borrow money and to have access to funds where there are changes.

My noble and learned friend has not dealt with the argument. The simple way to deal with this is as follows. If a change is made to the allowances, the revenue consequences will be that the product of the 10p tax instead of being £4.2 billion or £4.5 billion will be £4.2 billion or £4.4 billion. That £100 million shortfall could easily be recovered by increasing the rate of tax. The Scottish Parliament would not be disadvantaged by that because it would simply have to increase the rate of tax. There might be a problem of timing, but there is a provision for borrowing to deal with it, and that would give direct accountability. I agree that it is messy, but for the life of me I do not understand why we are going on with this exercise where my noble and learned friend will not concede that, rather than have a very complicated provision for tax, it would be better to provide that the Scottish Government are able to change the allowances as well as the rate if the UK Government see this as a great administrative difficulty for them.

My noble and learned friend did not deal in his response with the problems that arise from welfare. As I understand it and as his letter points out, eligibility

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for benefits will depend on net income. That means that if Scotland, as I suspect it will, becomes the highest taxed part of the United Kingdom, net incomes will be lower and therefore it will be necessary for benefits to be increased. Perhaps my noble and learned friend will help me with this. If, for example, the Scottish rate of income tax was higher and the effect was to reduce net incomes and therefore more would need to be paid in benefits, would the Scottish Government have to send a cheque to the UK Exchequer to deal with the consequences of the fact that in Scotland more people were dependent on benefits? Politically, I think that that, too, would be extremely difficult.

As the noble Lord, Lord Kerr of Kinlochard, has pointed out, the no-detriment principle is basically just trying to replicate the block grant and dress it up as income tax. The consequences will be that everyone in Scotland will end up paying higher income tax than people in England in order to finance a vehicle which does not do what it says on the tin.

Lord Wallace of Tankerness: There is a point that my noble friend is not addressing: no amendment has ever been brought forward to devolve allowances. It would be a major change to make at this stage of the Bill and he has not advanced the idea before but, that apart, it did not commend itself to the Calman commission or to the Government. Is he saying that the United Kingdom Government cannot make changes to a tax allowance which will benefit all taxpayers in the United Kingdom and that, if they do, they will be giving with one hand and the Scottish Parliament will be taking away with the other? That is an untenable position for a unionist to take.

Lord Forsyth of Drumlean: It is not my idea. It is the noble and learned Lord's idea to introduce a Scottish income tax. We have never had a Scottish income tax. If my noble and learned friend is saying that it is not a good unionist position to have a Scottish income tax along with a UK income tax, I could not agree more. That is what is wrong with the Bill and why I am against it. If you want to go down that road and you have set out the arguments for accountability on that basis, then do it properly and introduce a system that is workable.

Let us leave the issue of allowances. When we have Scottish income tax it will be possible for the Scottish Parliament to set the rate at whatever level it chooses-and not only the basic rate but the intermediate rate and the top rate. Mr Alex Salmond can have a top rate of 60 per cent and a basic rate of 30 per cent if he wants, and you can have a Government in England and the rest of the United Kingdom cutting taxes. Therefore, it is absolutely central to the proposal that there is the possibility-I would say the probability-that people in Scotland will not benefit from wise tax policies such as those pursued by my right honourable friend the Chancellor of the Exchequer today.

When my noble and learned friend says that if you do not have the no-detriment principle people in Scotland will not benefit from increases in the allowances for tax purposes, that is nonsense. It would be up to the Scottish Government. The Scottish Government would find that their block grant was reduced by a set amount,

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but they could get that set amount by taking the money from the taxpayers in Scotland, who would have benefited from the reduction in the allowances. That is the whole principle. My noble and learned friend shakes his head. The principle is that the Scottish Government are accountable for their spending and they have to raise that money through tax. The change in the allowances means that the tax available to them is less and therefore, if they want to continue the same level of spending, they will have to raise the tax. My noble and learned friend is running away from this because of the administrative difficulties that would be involved in dealing with the allowances.

On the point about there being no amendments on allowing the Scottish Parliament to set the allowances, I shall happily oblige: I shall table one for Monday and we can discuss this again. I shall be interested to hear how someone who is committed to the policy of making the Scottish Parliament accountable can possibly argue against it being able to set the allowances as well as the rates. You would have to have a Scottish allowance, of course, just as you have a Scottish tax, and it would operate in exactly the same way. However, by attacking this principle, my noble and learned friend is attacking the basis of the Bill-and I do so agree with him on that. I beg leave to withdraw the amendment.

Amendment 74C withdrawn.

Amendments 75 and 76 not moved.

Amendment 76A had been withdrawn from the Marshalled List.

Amendments 76B to 84 not moved.

Amendment 85

Moved by Lord Forsyth of Drumlean

85: Clause 43, page 32, line 40, at end insert-

"(4A) The following provisions shall not come into force until the Scottish Parliament has passed a legislative consent motion signifying its consent to those provisions-

(a) sections 12 to 14,

(b) section 27, and

(c) Part 3.

(4B) If the Scottish Parliament fails to pass a legislative consent motion under subsection (4A) within two months of the passing of this Act, then the provisions listed in subsection (4A) shall lapse."

Lord Forsyth of Drumlean: My Lords, I will speak briefly to this amendment, which relates to the Scottish Parliament passing a legislative consent Motion and certain parts of the Bill not being implemented. This has been slightly overtaken by events given the very helpful Statement made by my noble and learned friend. I am concerned about the substance of what has been agreed in return for the legislative consent Motion. This amendment gives us a good opportunity to discuss some of the issues arising from the legislative consent agreement. We are told that the Scottish Parliament will pass the necessary legislative consent today or this week. Perhaps my noble and learned friend can help us on that.

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Lord Wallace of Tankerness: As I understand it, the Scottish Parliament has sent its response to its Scotland Bill Committee. In that, it indicated in similar terms to our Written Ministerial Statement what the agreement is. It has tabled or will table a legislative consent Motion on the basis of following on from that agreement. That Motion should certainly be dealt with before our Third Reading but obviously I am not responsible for the timing of debates in the Scottish Parliament.

Lord Forsyth of Drumlean: You have to admire the way that the Scottish Parliament is run. Its committee made 25 major recommendations for changes to this Bill which effectively involve devo-max. They were full fiscal autonomy and a range of other things. Those sat on the table from before Christmas until now. Due to the brilliance of my noble and learned friend, he and his colleagues had a meeting with the First Minister and suddenly everything that the committee said vanished like snow off a dike. We are told that a procedure will be followed that will result in the Scottish Parliament giving agreement. That really is the accountability that we all came to expect from devolution. We have here one man-the First Minister-deciding what happens and everybody else falling into line. Otherwise, it would not be possible to deliver this.

Fortunately, it does not quite work like that in this House. I have a few points to raise on this issue of legislative consent. The first thing we need on the record is the Government's position on legislative consent. I pressed my noble and learned friend on this before and I hope he will tell us now that he has finished his negotiations. Is the Government's view that legislative consent is desirable but in the absence of it they will proceed anyway; is there a new constitutional principle that we do not do things without legislative consent; or is the constitutional principle that we try to get legislative consent if it is practical? That is very important because it will impinge on the debates that we are about to have on the referendum, where the Government say that they will proceed by Section 30 but Section 30 requires legislative consent. I want to be absolutely clear where the Government are on the issue of legislative consent. In the absence of legislative consent, would the Government still proceed? That is not a perfect example because of course the referendum issue has nothing to do with the Scottish Parliament as it is a reserved power. In respect of non-reserved powers for the Scottish Parliament, where are we on legislative consent?

I want to pick up one thing from the Statement that my noble and learned friend made today on what has been agreed. That is the first section, which says:

"The Government will ensure that changes in the Scottish Government's budget are closely linked to the performance of its economy by adjusting Scotland's budget to reflect new tax powers using the model recommended to the Welsh Assembly in the Holtham Report".

The noble Lord, Lord Browne, who is a man of considerable ability-as we have discovered in the course of consideration of this Bill, as well as from his previous work-has read the Holtham summary, and I expect that he is as unsure of the meaning of that sentence as I am. What does it mean? Does it mean what we have just been discussing and, if so, why does it say,

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as opposed to changes in the Scottish Government's income? The Scottish Government's budget is what Alex Salmond dreams up one day and promises the Scottish people, but it has no relation whatever to the Scottish Government's income, as people are about to discover.

5.45 pm

The second paragraph says:

"The Government will work together with the Scottish Government over coming months and years to give operational effect to the powers including the block grant adjustment, in a fair and sustainable way and should reach agreement on all implementation issues".

Is this a commitment not to reform Barnett, or to reform Barnett? It is very important that we should be told what the Government have committed themselves to in order to get a legislative consent Motion, which they did not need to get to bring this Bill to the statute book. I congratulate the Government because I had tabled an amendment, which I withdrew earlier, indicating that the Scottish Government should have to pay for the cost of administration of the new income tax system. I am delighted to see here that they have agreed to that. However, it seems very important that we should have clarity from the Government as to what has been agreed on this legislative consent Motion-and I accept that we have moved on since my amendment was tabled.

The last question I have for my noble and learned friend in respect of the legislative consent Motion is: what exactly does this sentence-

"The Government is open to considering what further powers might be devolved after a referendum on independence"-

mean? Would that, for example, include giving them powers to decide the thresholds for income tax purposes? Making an open-ended commitment of this kind without specifying it is bizarre, especially in the context of a Bill which delivers extraordinary additional powers that no one seems to know about. Why have the Government agreed to talk about giving further powers, when many of those further powers are already contained in the Bill? When we were discussing these matters earlier in Committee, I was quite firmly and rightly told by the noble Lord, Lord Browne, and by my own Front Bench that we have to concentrate on the key issue, which is whether Scotland wishes to remain part of the United Kingdom. Opening up this question of further powers without saying what they are is a hostage to fortune. I beg to move.

Lord Foulkes of Cumnock: My Lords, I welcome the fact that a legislative consent Motion has been agreed. I also welcome its terms; I mentioned that earlier, and we may have the opportunity to discuss it later on. However, I want to refer briefly to the very important point made by the noble Lord, Lord Forsyth, almost as an aside in his introduction. It was about the speed by which this legislative consent Motion was agreed within the Scottish Executive.

At the end of this week, I am going to one of the most newly independent countries to talk about its request for accession to the European Union. The EU has made it clear to that country that it will not get membership-I am sure that the noble Lord, Lord Williamson, knows exactly what I am taking about-until it can show that there is a clear separation of powers

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between the legislature, the Executive and the judiciary. It is right that the EU should impose that condition upon the application, and we are going to discuss it and what needs to be done to change the arrangements in the country's constitution.

It occurs to me now that the situation in Scotland, which has come about because of a series of events, is presided over by someone chosen by the First Minister, and that there are committees-my noble friend Lord McConnell knows more about this than any of us, and I know that the noble Lord, Lord Steel, has looked at it carefully-which were supposed to be the checks on legislation as it went through and to challenge and question what the Executive were doing, as indeed they did until the most recent election in Scotland. These committees have SNP majorities. With committees here, where there is a government majority in the House of Commons among committee members, we get a degree of independence and challenge to the Executive. There is none of that in Scotland now.

Even here in the Cabinet-if the situation is still the same, and I understand that it is-before agreement is finally reached, a letter or memorandum is sent around the various departments concerned, agreement has to be reached by the department and there is some consensus. That takes time and some thought. In Scotland now, all it needs is for one man to make a decision that something will happen and it is automatically agreed by his Cabinet and Executive, which are beholden to him, and by his legislature, which is also beholden to him. That is not good for democracy. It would not be acceptable if an independent Scotland applied for membership of the European Union, which is another reason that could rule it out. That situation is very worrying and something that we have not really addressed in this Committee but should have done at some point.

Apropos this concern, I said jokingly in a tweet yesterday-the noble Lord, Lord Forsyth, laughs, but this is a modern form of communication and even people of my age have to get used to it-that Scotland might need a second Chamber, and I referred to it mischievously, as I have done before, as a "House of Lairds", which is just a name for it. I was not suggesting that the hereditary Peers from Scotland should be recalled for that purpose-certainly not the noble Earl, Lord Erroll, for example, but that is another story. Interestingly, from a number of people on Twitter who do not normally agree with me I had a lot of agreement; they are genuinely worried that there is no check and balance on what is decided by the Scottish Executive. This issue is worrying, and it is time that those of us from Scotland who are concerned about Scottish democracy paid some attention to it.

The Duke of Montrose: My Lords, I would like to probe a little further the question that my noble friend Lord Forsyth has raised about where we stand on legislative consent Motions. I do not know if what I have will throw any more light on the topic but, as noble Lords will know, we have spent quite a long time considering when a legislative consent Motion might appear. I draw to your Lordships' attention that there is enough evidence from what Ministers have told us that primary legislation does not require legislative consent.

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I am sorry to see that the noble Lord, Lord Sewel, is not in his place because much of what I have to talk about refers to what he told us in this House in 1998. He and others in the House will recall that in the Committee stage of the Bill the question of an application of an Order in Council as being the route by which amendments to Schedule 5 could be achieved was discussed. It is just possible that some people's recollections might, like mine, be a little hazy since most of this discussion took place at around 11 pm-something that we were beginning to get used to the other day. There was a serious probing amendment, which said that the power to use the Order in Council mechanism should be removed in regard to Part I of Schedule 5. The mechanism was insisted on by the Minister because it was the Government's intention to make it a condition of procedure that the Scottish Government had to agree to alterations to Schedule 5. Great emphasis was placed on this, which was considered the unequivocal virtue of the Privy Council process. However, the Minister's view was clearly that primary legislation did not require the agreement of the Scottish Parliament; this can be found in Hansard at col. 849 on 21 July. Therefore, the Scottish Parliament would officially have no say in any primary legislation.

Here, today, we will be only too aware that on previous days the Committee has endeavoured to add amendments to the Bill that would bring in more detailed recommendations by the Calman commission and others. So far, all these efforts have been rejected and many of the amendments at this stage appear to aim to introduce them using the Privy Council route at a later stage. From the approach taken by the Labour Government before us, it seems that any or each of these Orders in Council will properly be subject to a legislative consent Motion from the Scottish Parliament, which is different from the one that we are talking about today. As we have proceeded with this legislation, a great deal has been made of the idea that we are looking for the completion of the Motion before we get on to the Bill.

It is important that the procedures that are required should be absolutely clear. Since this is primary legislation, it would appear-from applying the explanations that were offered to us-that the legislative consent Motion is not strictly necessary for the Bill but would be for the statutory instruments to implement it. Could the Minister tell the Committee whether this argument for seeking some sort of agreement with the Scottish Parliament is just part of a concordat or is being introduced for politeness, or whether some legislative measure has recently been introduced that requires its fulfilment? If not, is it not true that in hard legislative terms the consent of the Scottish Parliament is not required?

Lord O'Neill of Clackmannan: My Lords, at some stage I think we were concerned that this might be a complete waste of time if we were not going to get a legislative consent Motion. Whether it was necessary was not the issue. It was a question of whether there was a nod of approval or acceptance from the Scottish Parliament.

In our lengthy debate last Thursday, some of us raised our concerns about what we considered to be the inadequacies of the committee system in Scotland.

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It would appear that this concern over those inadequacies is shared by the First Minister in so far as he pays attention to them. We are continually assailed in the Scottish press by the question of which country Scotland should be compared with. Should it be Norway or Iceland? It is not Iceland any more and it certainly is not Ireland. Perhaps Belarus would be an appropriate example of a northern European country that operates on the whim of its leader. However, that will be regarded as an insult to Mr Salmond. Such is his sensitivity and the thinness of his skin that if I were to make such a suggestion, I do not know whether I would get off a plane at Edinburgh Airport tomorrow night, although I would be happy to have a go.

We are also indebted to our new communicator-the new electronic man behind me, my noble friend Lord Foulkes. I have heard it said that he has been called a Twit. I do not think that is an unparliamentary word; it may well be appropriate in this case. I have never known the noble Lord, Lord Foulkes, to express himself in anything like as few words as 140. I am sorry; I meant to say 140 characters. I do not know whether there is a sequential tweet here, but perhaps the relevant material could be placed in the Library so that we could see the Foulkes Twitter sequence.

Coming back to the point, it would be helpful if the Minister could give us some indication of the conversations that he had with the First Minister and how this concordat has been arrived at. If we can reach agreement on that matter so quickly, perhaps other problems can be dealt with in a similarly efficient, if not particularly democratic, way.

6 pm

Lord Browne of Ladyton: My Lords, I support the general tenor of this debate in so much as it encourages the noble and learned Lord to explain the Written Ministerial Statement more fully and how we will take forward-if we are to do so-the agreement that has now emerged between the Scottish Government and the coalition Government. It would appear that that agreement has encouraged the Scottish Government to do no more, according to the Statement as I read it, than to,

That sentence has been somewhat extravagantly interpreted, perhaps for other purposes, by some of my noble friends and other noble Lords.

It is incumbent on us to pay appropriate respect to the Scottish Parliament, which will have to debate a Motion. No doubt some members of that Parliament may disagree with the agreement that their Government have reached. How they vote will be a reflection of the way in which that Parliament operates, which seems to copy our voting discipline substantially, from what I can see: that is, people often conform to the position adopted by their party. I was amused by the idea that a country that did not have a genuine separation between its Executive and its legislature would no longer qualify for membership of the European Union. Given that our Executive seems to be part of our legislature, if we were not already members of the European Union, we might struggle to get membership of it on that criterion.

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I approach this issue in this way because I have been on record repeatedly in this Committee as being confident that the Scottish Parliament would pass a legislative consent Motion. I am confident because it has already done it and because many significant Members of the Scottish Parliament have already voted for a legislative consent Motion on most of what is before us in this Bill. To the extent that the Bill has been amended, it has been amended at their request. It therefore did not seem consistent or politically likely that that Parliament would not pass a legislative consent Motion at some stage. I have said this before and I am not saying it now in the knowledge that an agreement has been reached. I have been confident that that would happen. However, I have also said before, and I repeat, that as far as I am concerned that has never been a condition precedent for us getting on and dealing with this Bill. I have been prepared to entertain debate with noble Lords about what we need to do if there is no legislative consent Motion, although I have been confident that there would be one, and it seems that my confidence was not misplaced.

However, from my perspective of the politics of Scotland and where we are at this challenging time, it is important that we keep our word to the Scottish people and pass this Bill, which has its genesis in Calman and prior to that in the Scottish Parliament and all the devolution parties in Scotland. We should proceed to offer these additional powers to the Scottish people through their Parliament. It would then be a matter for the Scottish Parliament to decide whether to accept them, and it would not be our responsibility, and certainly not the responsibility of an unelected Chamber of this Parliament, if it did not offer them.

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