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Mr. Wallace: The hon. Gentleman has raised an important point because although the sovereignty of Parliament is quite clearly a concept of English constitutional law, if he reads the dicta of Lord President Cooper in McCormick v. the Lord Advocate, he will discover that that concept was never part of Scottish constitutional law. The Scottish Parliament did not have the same sovereignty as the English Parliament claimed, so there is no reason why the United Kingdom Parliament should have adopted exclusively English constitutional practice.
Mr. Jenkin: That was the case in a previous period of Scottish history, but the referendum result confirms that the sovereignty of the Scottish people is vested in this Parliament. That is what the White Paper said and what is expressed in the Bill. Sadly, it is no surprise that this is a matter of dispute among pro-devolution parties. The hon. Member for Gordon has said that the days of parliamentary sovereignty are at an end. I sought to intervene on the hon. Member for Dundee, East (Mr. McAllion) to ask him whether he would support
explicitly clause 27(7), but I doubt whether that is the case. The Minister of State did nothing to resolve that ambiguity. The consensus in Scotland Forward was a false consensus.
Mr. Salmond: I do not know whether the hon. Gentleman fully picked up on the point made by the hon. and learned Member for Orkney and Shetland (Mr. Wallace), so I shall give him another opportunity. The quotation from Lord Cooper is:
Mr. Jenkin: The reality of the British constitution is that to be part of the United Kingdom is to accept that the sovereignty of the people is vested in Parliament. It does not surprise me that the nationalists should take an opposite view, but it does surprise me that Members from other, supposedly Unionist, parties should do so.
The fundamental question is whether the new Parliament will respect the limits set on it by the Bill. That ultimately depends on how the Parliament behaves and how it is perceived, rather than on how its powers are defined in law. Will it be no more than a parish council, to which the Prime Minister once rather unwisely compared it; or, if it chafes against policies such as welfare reform or student fees, will it claim a mandate at least equal to that of Westminster to assert the sovereign will of the Scottish people? That is clearly the expectation of the hon. Member for Falkirk, West (Mr. Canavan).
For that reason, it is vital that the sovereignty of this Parliament should be reaffirmed. We shall table an amendment that should offend none but those who have an implicitly nationalist agenda. Although such an amendment is, of course, superfluous from a legal point of view, its purpose is not legal, but political--it is designed to reinforce the bonds that hold the Union together, at a time when they are likely to be tested. The Secretary of State will have a chance to show that he is not the Dr. Faustus of Scottish politics, who has sold his Unionist soul to the nationalist devil for the temporal glory of holding office.
Mr. Canavan:
To portray my right hon. Friend the Secretary of State as some threat to the Union is patently ridiculous. The biggest threat to the Union over the past 20 years was Lady Thatcher's stubborn refusal to respond to the legitimate aspirations of the people of Scotland to have a Scottish Parliament.
Mr. Jenkin:
I seem to remember that the trade unions in Dundee, East cost the people of Dundee an electronics plant. That is what Mrs. Thatcher fought in Scotland, and the people of Scotland should be grateful that she succeeded.
There are bound to be serious disagreements between the two Governments. The White Paper assumes that the new Scottish Executive--effectively the Government of Scotland--will work harmoniously and in mutual co-operation with Whitehall. Any observer of relations
between Whitehall and local government, or between national Governments in the European Union, will testify to the likely difficulties ahead.
This afternoon, the Minister made much of the German, Italian and Spanish models of devolved government. If we were independent states drawing under a single Government within the framework of a carefully balanced constitution, the German experience would be instructive, but that is clearly not the case in the United Kingdom. In Italy, regional government has made public finances all but impossible to control; and Spain should be a cautionary tale to reckless British regionalisers. The lesson of Spain is perfectly clear: a rolling programme of devolution generates a process of inter-regional competition, leading to precisely the sort of instability that we should all fear. Spain's politics have become bogged down, and its economy is sclerotic with unemployment rampant. It is hardly an advertisement for the success of such a devolution policy.
Here, there will be the same delay and confusion as disputes are resolved--delay and confusion that could threaten inward investment and hurt business confidence. At worst, such conflict will be deliberately used to fan the flames of nationalism, both Scottish and English, in the way described by my hon. Friend the Member for Rochford and Southend, East. An Edinburgh Parliament, dominated by the nationalists and the left--who have spent the past 20 years denigrating the constitutional settlement under which Scottish culture and enterprise have flourished--will inevitably demand more powers for itself and greater independence for Scotland. That is why we have always said that the Government's plan could destroy the United Kingdom. Unionists must join forces to ensure that that does not happen.
Scotland's profile is not the same as Scotland's influence. The danger is that Scotland and its interests are being removed from the real spheres of influence upon which jobs and prosperity depend.
My hon. Friend the Member for Woodspring (Dr. Fox) talked of Scotland's potential isolation in Europe. Scottish Ministers will no longer participate in collective decision making at Westminster to help to construct the UK's negotiating position, except with the permission of the Westminster Government. All that the Executive will have is the right to be consulted. Instead of having a genuine involvement as equals, Scottish Ministers would have to take it or leave it.
What would happen if Edinburgh campaigned openly against a UK position at a crucial point in negotiations on an issue such as fish or agricultural prices, or some competition issue? What would happen if Edinburgh refused to implement a European Community decision to cut fish quotas? What sort of influence would Scotland have then, except to be subject to a concordat?
Scotland is reducing its voice in Whitehall just when it most needs it. With the reduction in the number of Scottish Members of Parliament at Westminster and the office of Secretary of State stripped of all its powers, Scotland will lose its influence in Whitehall and Westminster, where the crucial decisions affecting Scotland will continue to be made. The prospect is that Scotland will have its existing share of public spending eroded. Maintaining that share is the greatest challenge facing the new Parliament.
Money is likely to be at the heart of most of the conflict between Westminster and Edinburgh. The present system has served Scotland remarkably well. The most recent figures show that public spending per head of population was 24 per cent. higher than in England.
The Government's White Paper says that the Scottish Parliament's budget will be broadly comparable to the present budget of the Scottish Office and also includes a commitment to the Barnett formula. But those promises are not enshrined in the Bill--quite the opposite. Clause 61(2) simply says:
Under the present system, the Secretary of State is able to fight for Scotland's interests within the Cabinet, which has direct responsibility for government north of the border and hence every interest in securing a good deal for Scotland. That will no longer be the case after devolution, when the Secretary of State will have little clout in Whitehall. Suggestions that he could combine the job with that of First Minister are improbable in view of the responsibilities given to each party in the Bill as drafted.
I repeat that the Conservatives stand by the spending settlement that we gave Scotland in the previous Parliament. It reflects Scotland's needs, but it will take some explaining in future as the figures fall under scrutiny in the new political climate surrounding devolution, and Scotland starts to deploy its own tax-raising powers.
Devolution has led to widespread questioning of the Barnett formula, with many complaints about it from the Government's own Benches, including complaints from Lord Barnett himself. The insidious and insistent questioning of the existing public expenditure settlement between Scotland and England is likely to be a permanent feature of the new post-devolution politics. Its effects are bound to be felt by Scottish public services and taxpayers in the years ahead. There may never be a dramatic reckoning, but Scotland should prepare for the likelihood that billions of pounds will be whittled away from the Scottish block grant in the next few years unless the Scottish Parliament can play as canny a game with Westminster as successive Secretaries of State for Scotland have played in Cabinet.
What an irony it would be if the very devolution of which Scottish socialists have dreamed for so long and which was so dreaded by the Conservatives should result in exactly the same sort of paring down of the public sector in Scotland that all Scotland's political parties dread. Nothing would return Scotland's politics so rapidly to reality than the unravelling of the generous public spending settlement that Labour inherited from the Conservatives; nothing will create as much uncertainty, tension and turmoil.
The Opposition do not invite the House to decline to give the Bill a Second Reading tonight, but nor does our reasoned amendment accept the Bill as it stands.
We do not have a rose-tinted view of how the Parliament will work. The new arrangements are not a settlement but a series of unanswered questions. The political context of the Bill leaves huge scope for dashed expectations for the Scottish people, and misunderstanding and dispute between Edinburgh and Westminster.
Scotland is set to be sidelined in Europe and UK politics, and it is far from clear how Scotland will continue to secure its interests or public funding without raising domestic and business rates alongside the tartan tax. That threatens the Scottish prosperity that Labour inherited from the Conservatives.
History will judge whether Labour has led the Scots responsibly, but we shall make our case in Committee on all these points. We are grateful to the Secretary of State for the spirit of co-operation across the Floor on this matter.
"The Secretary of State shall from time to time make payments into the Fund out of money provided by Parliament of such amounts as he may determine."
It will be up to the Secretary of State to determine how much money Scotland will receive, but the Secretary of State is answerable to Parliament here at Westminster, not Edinburgh, thus providing an annual flashpoint between the Scottish and UK Governments.
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