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Lord Mackay of Ardbrecknish: My Lords, I am grateful to the noble and learned Lord. I am puzzled by his use of the expression, which I heard on a number of occasions, "concordat between the Welsh assembly and Whitehall". That implies that the Welsh assembly, as an assembly, will agree the concordat but Parliament here will not have any say in it. I wonder if he means between the Welsh executive and Whitehall?

Lord Falconer of Thoroton: My Lords, it will depend on the precise circumstances of each concordat. The purpose of the concordats is to provide co-operation between the Welsh assembly and its executive on the one hand and central government on the other. The precise parties to those concordats--which particular agencies--must be decided as we determine the most appropriate way of dealing with the issue.

I turn to the issue of the Civil Service. The noble Lord, Lord Crickhowell, pointed out that one must be clear to whom the Civil Service owes its obligation. As is well known, the Home Civil Service owes its duty to the Crown. Those within the Civil Service who serve the Welsh executive and those who serve the Welsh assembly will continue to owe that obligation to the Crown. They can continue to owe that obligation to the Crown irrespective of whether the Welsh executive is in the hands of one party and central government is in the hands of another. Civil servants have been doing that for many years and I believe that there will be no difficulty in relation to this issue.

I turn to agencies. Noble Lords asked about the precise role of the new powerhouse--that is the three agencies put together--under the new assembly. That is a matter for the assembly to determine. The assembly will appoint people to the agencies. It will determine its funding and theirs. It is for them to decide how to use the powerhouse and how other agencies will operate within the context of the new assembly.

The noble Lord, Lord Callaghan of Cardiff, asked what was meant by the new social role of the Welsh Development Agency. The new powers of the WDA provided in the Bill merely replicate the existing powers of the Development Board for Rural Wales. The development board is currently empowered to spend money for community development and similar projects in the area of mid-Wales for which it is responsible. The Bill conveys those powers instead to the WDA, thus allowing them to be exercised for the benefit of all parts

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of Wales. It will be for the assembly to direct how the WDA might exercise those powers, as with all its other powers.

Those were the major issues around which the debate focused. Perhaps I may now deal with important points which did not form the focus of the debate to the same extent. First, the noble Lord, Lord Thomas of Gresford, asked whether there should be a duty on the Secretary of State and the assembly to consult with each other about primary legislation. There is already a duty under Clause 32. He then asked about the possibility of a Lord Justice sitting permanently in Wales. His ambitions then increased to a Lord Chief Justice. His demands became all the more voracious as the debate went on. He suggested that there should be a Lord Chief Justice for Wales, but I can offer him no comfort in that respect. The proposal goes way beyond anything which was mandated in the course of the referendum, or in the manifesto, or in anything that has been said. The noble Lord should not hold out too much hope in relation to that.

The noble Lord, Lord Griffiths, asked whether it was right that there should be a transfer of further powers to the Welsh assembly simply by way of order and not by way of primary legislation. The structure of the proposal is clear; it is that the administrative function of the Secretary of State for Wales should be transferred to the assembly. The powers which can be transferred are set out in the schedules to the Bill. They are contained in primary legislation and it appears to us to be an appropriate and properly protected way of dealing with the powers which should be transferred.

It is perfectly conceivable that to begin with we will get the precise extent of the powers wrong. It seems inappropriate that one should have to return with primary legislation to deal with that. It is much more sensible to deal with the matter by way of secondary legislation. I believe that that was a perfectly legitimate argument--indeed, the correct argument--in support of secondary legislation.

The noble Lord asked about tax-raising powers. We do not have the power, nor do we have the intention, to transfer tax-raising powers to the assembly. Any such proposal, which is not in our minds, would require primary legislation. Therefore, that particular route is not available to us under the terms of the Bill.

Much was made of the role of the Secretary of State once the assembly is up and running. We have made it clear that we are committed to retaining the post of Secretary of State for Wales to represent the interests of Wales in the Cabinet. Some noble Lords during the course of the debate maintained that there would not be a role for the Secretary of State for Wales because all his powers were being transferred to the assembly. Parliament will continue to make primary legislation for Wales. Therefore, one of the Secretary of State's key roles will be in the development of the Government's primary legislation. The Secretary of State will continue to represent the interests of Wales in policy areas which will not be the responsibility of the assembly; for example, defence and social security.

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The Bill confers some specific duties and functions on the Secretary of State, such as providing funding to the assembly and consulting it about the Government's legislative plans. The Bill does not prevent one person being both assembly first secretary and Secretary of State for Wales. Whether one person would fill both posts is a matter for the political parties in selecting candidates for the electorate at the ballot box, for the assembly in choosing who is to lead it and for the Prime Minister of the day. The Secretary of State will be chosen by the Prime Minister and will be bound by Cabinet collective responsibilities while the first secretary will depend on the confidence of the assembly. Therefore, there will be a role for the Secretary of State in Cabinet in the UK Government. The Secretary of State can also be the first secretary, subject to the views of the assembly and the Prime Minister.

The noble Lord, Lord Crickhowell, asked about the University of Wales. The Higher Education Funding Council for Wales funds universities in Wales. The Bill does not change that because the assembly's powers to reform public bodies in Wales does not allow it to abolish the Higher Education Funding Council for Wales. The assembly will assume the functions of the Secretary of State for Wales for appointing, funding and directing the funding council and holding it to account for its performance. The ability of the research councils to fund research undertaken by universities in Wales is not affected by the Bill. I am not sure whether that precisely answers the point raised by the noble Lord, Lord Crickhowell. I shall read Hansard and, if appropriate, write to him to deal with the particular issues he raised.

The noble Viscount, Lord Tenby, asked whether we can give any time-scale in relation to the transfer of records from London to Wales. I am afraid that I cannot. First, it will be necessary to review the options for housing those records to the necessary standards for both presentation and public access. Those options will require to be costed. It will then be for the assembly and my noble and learned friend the Lord Chancellor to agree the best way forward. Therefore, I can give no undertakings now as to the timetable for all that. But the provisions hold out the prospect in due course for a Welsh records office of a very high standard indeed.

The noble Lord, Lord Dixon-Smith, referred to relationships with local authorities. The assembly's duties and powers in respect of funding local authorities in Wales will be conferred on it by an Order in Council under Clause 22 by transferring to the assembly the Secretary of State's functions in local government finance legislation. Any powers which the assembly has over local government funding will be no more than the Secretary of State exercises at present. The difference is that the assembly will be directly accountable to the electorate in Wales for the way in which it uses those powers.

I am sure that I have not answered every point which has been raised in this very important debate. I shall read Hansard and, if necessary, write to noble Lords. We have listened attentively to the contributions from all sides of the House. I do not share all the views and opinions which have been expressed.

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The provisions of the Bill are fundamental and far-reaching, but it would be misconceived to try to paint them as some kind of threat to the future of the Union. In fact, they are the least that is needed by way of reform and modernisation to equip Wales to move into the next millennium as a successful and integral part of the Union.

What we have here is a comprehensive measure for bringing government closer to the people, for ensuring that government money is better directed to meet the express needs of Wales and for driving forward the economy of the whole of Wales, bringing the prosperity that some parts already enjoy to the rest. It is about the creation of a political framework capable of improving the quality of life for people in Wales. Those are objectives that I hope your Lordships on all sides can share and, in so doing, can work with us to make the assembly the success that Wales deserves. I formally commend the Bill to the House.

On Question, Bill read a second time, and committed to a Committee of the Whole House.

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