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The Earl of Lauderdale: My Lords, is the noble Lord aware that Hitler's power was based entirely on plebiscites?

Lord Watson of Invergowrie: My Lords, that is a rather unfortunate analogy. In any case, that example is not entirely accurate because I seem to remember that Hitler was elected to power (by some system) in the 1930s. I do not think that that example serves the noble Earl's argument.

My argument is that referendums--I refuse to say "referenda"--are a useful source of enhancing democracy. By definition, the political parties approach a general election with a manifesto. There is no way in which you can pick and choose certain items within a manifesto. You either vote for the party or you do not. That is a blunt-instrument approach--and necessarily so. It is important that in their manifestos political parties are prepared to say, "We will give you a vote on this or that issue", as the Labour Party fairly and democratically did. A referendum gives political parties the opportunity to argue their case in a much more detailed and focused fashion than could ever be possible in a general election debate. That is a very positive aspect of referendums.

I believe that referendums are appropriate specifically for constitutional issues. That is why the referendums on Scotland, Wales and Northern Ireland, and that which is forthcoming on our voting system, are particularly apposite. If we are going to change major aspects of our constitution, I believe that it is far better to do so via a referendum than a general election for a long time. I have very much wanted to see us reach the present position.

Perhaps I may now deal with a question which is difficult to handle. It has been raised by many noble Lords both yesterday and today. I refer to the question of whether the creation of Scotland's parliament will lead inexorably to an independent Scotland, the break-up of the Union and the rise to power of the Scottish National Party. I see no reason to assume that it will.

I recall that yesterday the noble Lord, Lord Mackay of Ardbrecknish, seemed to be full of doom and gloom about the fact that already, within months of the referendum, the SNP is in a much more powerful position in the polls in Scotland than has ever been the case hitherto. That is, indeed, true. However, one should not read simply the top line of such polls because one gets a slightly different message if one goes beneath the surface and asks what people's voting intentions were when they voted for the SNP or indicated a preference for independence.

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I believe that when the parliament beds in, people in Scotland will come to see that it serves their needs well within the Union and that there is no need to break away and to try to seek independence. However, if there ever was a referendum on independence for Scotland I would argue vigorously against it. I do not think that that is the right way to move. I do not think that it would be good for the people of Scotland. It would certainly not be good for Scotland's economy. I would argue against it.

However, I am prepared to put my faith and trust in the people of Scotland to weigh up the issues if they are put to them fairly and openly and to arrive at the decision that they collectively believe to be in the best interests of Scotland and the people who live there. Of course, not everyone who lives in Scotland is a Scot--and that is a great strength. I am prepared to put that to the test.

One reason I am so enthusiastic about the parliament is that I believe that when the people of Scotland see that decisions are being made much closer to them and that they have a parliament that is more responsive, accountable and accessible--that is a crucial factor--they will warm to the different ways of doing things within a decentralised governmental structure. I prefer the word "decentralisation" to "devolution" not least because nobody seems to know how to pronounce the latter. I think that "decentralisation" is a much more accurate term.

The noble Lord, Lord Kingsland, referred to the "great decentralisation of Britain". I welcome that. We are moving within the United Kingdom towards decentralised government having for almost 20 years had a government who were increasingly centralised, and who made us one of the most centralised states in the European Union. That swims against the tide of what has been happening in many other countries, which is unfortunate. In government, we have begun to reverse that trend--and that is a very good thing.

I accept that different parts of the United Kingdom are moving ahead with decentralisation at different speeds. Scotland will take a fairly major leap, with Wales and Northern Ireland making rather more modest leaps. That is not necessarily a major problem. Perhaps I may refer to what happened in Spain in the post-Franco period. Many of the regions that are now autonomous did not gain autonomy until some considerable time after 1975. However, the Spanish constitution was able to accommodate them and to develop with them. I am not drawing an analogy between the United Kingdom now and Spain in the post-1975 period, but I am saying that different regions do not have to move forward with one pace as one decentralises government. Of course, that creates problems and the sort of anomalies to which the noble Lord, Lord Steel of Aikwood, referred yesterday. Although those problems are not necessarily insuperable, they must be dealt with sensitively.

Looking 10 or 15 years into the future--I hope that it may not take as long as that--I should like to see decentralisation brought to England. By that, I do not mean an English parliament. If they are being slightly cynical, many Scots would say that England has had a

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parliament for many years, and still does. I want to see the decentralisation of power within England to the various regions. London is starting that process. I should like to think that within 10 or 15 years that process will be complete and there will be regional assemblies, or whatever the people in the regions want to call them, and that those assemblies will have broadly the same sort of powers as the Scottish parliament is at the moment scheduled to have. I do not see that as anything other than a strength. It would mirror developments in other major European Union countries, and I believe that it would strengthen and enhance our democracy. I look forward to going into these issues in greater detail in Committee.

I have referred briefly to the question which the noble Lord, Lord Steel of Aikwood, raised yesterday when he said that there is no answer to the West Lothian question. I accept that. If there was an answer to the West Lothian question, we would have found it at some stage in the past 20 years since Mr. Dalyell first raised it. Although I do not think that he did Scotland a service, it was nevertheless important that that issue was brought into the open and answered. My answer, such as it is--having said that there is no answer!--is that it is a transitional problem. It is not a long-term problem. The matter will be resolved when decentralisation within the United Kingdom is finally complete. Yes, we have to deal with that anomaly in the interim, but we should be capable of doing that in a mature, changing and modernising democracy. I look forward to revisiting that and many other issues such as the concordats, the relationship with Europe and the financing of the parliament in the weeks to come.

5.40 p.m.

Lord Renton: My Lords, the noble Lord, Lord Watson of Invergowrie, has made an interesting but rather controversial speech, but I do not doubt his sincerity. Although he did not expressly say so, perhaps one should infer from his remarks that he wants the sovereignty of the United Kingdom to be retained. I am glad to see the noble Lord nodding. When he said that government by referendum was the nearest that anyone could get to finding out what people wanted, I was reminded of a remark made by Sir Winston Churchill. He said that democracy worked badly but that one could not have any other system. When one considers government by referendum one must always ensure that a referendum has only an advisory effect. Admittedly, on this occasion the result of the referendum in Scotland was pretty decisive. I agree with my noble friends who have said that we must accept the degree of devolution such as is proposed in the Bill.

In my time I have won 10 general elections. Although I always tried to arouse the interests of voters as much as I could, as did the opposing candidates, I gained the impression that they were thankful when the election was over because they were pretty indecisive in making up their minds about very general matters. Let us be cautious about the noble Lord's reference to government by referendum.

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As I was born in Kent, am a member of the English Bar and represented Huntingdonshire for many years, noble Lords may wonder why I am involved in this debate. I am more than half Scottish. My father was a Scotsman and my mother partly so. My late wife was the daughter of a Scotsman. We have a family property in Galloway, where the local Member of Parliament was my noble friend Lord Lang of Monckton, who made such a formidable speech yesterday which is deserving of a great deal of attention. Twice since the war Galloway has had a Scottish nationalist MP, and it has one now. I do not believe that they at any rate should be taken too seriously.

My involvement in this matter does not end there. In 1971 I was appointed to the Kilbrandon Commission. That was the Royal Commission on the Constitution which considered devolution. I am the only member of that commission speaking in this debate. There are not many survivors of that commission. I disagreed with its main proposals for Scottish devolution. I was alone in recommending that Scotland should have only a deliberative assembly, with the very limited legislative power to consider the Committee stage of Bills which had had their Second Reading in Westminster and which would go back to Westminster for Report stage. It would also have had power to consider, but not finalise the decision upon, statutory instruments. They appeared to me to be two very good links with the Westminster Parliament and to provide a degree of decentralisation. I was not in favour of a Scottish executive.

When the Scotland Act of 1978 was considered in another place I took part in the debates there. I believe that the Act was constructed and drafted in a better way than this Bill. However, in view of the referendum result, we must support this Bill with a degree of parliamentary and executive devolution, even though the Scots might have produced a different verdict in the referendum had the Bill been passed before it was held and if the various views expressed on this Bill had been made known to them. For example, yesterday the noble Lord, Lord Dean of Beswick, made a most powerful speech, which pointed out the financial difficulties that would arise in Scotland with devolution.

I do not wish to anticipate the Committee stage in any detail. However, I should draw attention to the two most important provisions of the Bill. I refer to the provisions that deal with the legislative competence of the Scottish parliament and the functions of the Scottish executive. I shall say a brief word about each. As to legislative competence, this is described in Clauses 28 and 29 and in Schedules 4, 5 and 6. Those contain 27 pages of detail. That will require many hours of scrutiny at Committee stage. By contrast, the Scotland Act 1978, which had broadly the same purpose as this Bill, dealt with this vital matter much more succinctly in one-and-a-quarter smaller pages. The functions of the Scottish executive are dealt with in Clauses 48 to 54. They are perhaps unavoidably complicated. One must not complain too much about that. But the 1978 Act did it more simply and in a way which the Government should consider.

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I should like to add a word about the European Union. My noble friend Lord Mackay of Ardbrecknish raised some very important questions about the effect of Clause 49 on Clause 53. He was right to point out that even in countries that had federal constitutions (as several European countries have, which thankfully we shall not have under this Bill) only the central government are represented on the Council of Ministers and only the officials of central governments are able to carry out negotiations behind the scenes. If Scottish Ministers want some influence in Europe, as one must assume they do from what has been said and what is contained in those two clauses of the Bill, they must do so by getting the Secretary of State for Scotland to raise the matter with those members of the Cabinet of the United Kingdom who have responsibilities in Europe. I refer not only to the Foreign Secretary but to the Minister of State for Agriculture, Fisheries and Food, and the President of the Board of Trade, who also has some responsibility and from time to time has appeared at the Council of Ministers. One must be careful to avoid conflict between the Scottish executive and the Cabinet of the UK on these very important external matters and other external matters.

As to internal matters, from time to time there is bound to be conflict between the Chancellor of the Exchequer and the Scottish executive. Goodness me, every week in the newspapers there is a report of a conflict between the Chancellor of the Exchequer, who happens to be a Scot, and other members of the Cabinet. One dreads to think how that failure to agree will manifest itself when there is a separate Scottish executive with financial interests which conflict with the Exchequer of the United Kingdom. The noble Lord, Lord Dean of Beswick, alerted us to the financial conflict which is bound to arise with the Scottish parliament and executive crying out for more money. Poor old England!

In conclusion, I wish to mention two legal matters of some constitutional significance. First, as my noble friend Lord Kingsland said, the Government are right to have the Judicial Committee of the Privy Council to scrutinise Bills to see whether they are valid; that is, within the powers granted under the Bill when it becomes an Act. That arises when there is doubt about the legislative competence. It is right to have the Privy Council doing that rather than our distinguished and learned Law Lords. Most of our Law Lords are English. Normally only two are Scots. Although they would do the work perfectly, we must avoid what might appear to be a conflict when they have a duty to overrule a proposal. The noble and learned Lord, Lord Hope of Craighead, was right when he said yesterday that more Scottish judges need to be appointed to the Privy Council so that there may be a wider choice and a greater Scottish influence when the Privy Council has to decide these matters.

Secondly, I am glad to see the noble and learned Lord the Lord Advocate--for whom we have all developed a great respect--sitting on the Front Bench. He will wind up the debate. He is given considerable extra responsibilities under the Bill. I earnestly hope that they will not result in his having to abandon any of the

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important work which he does in your Lordships' House and which has been undertaken by Lords Advocate since 1969 in this House. Indeed, the Committee on the Preparation of Legislation, of which I was chairman, drew attention to the importance of having the Lord Advocate advising not only on Scottish legislation but in a general way in your Lordships' House. It is important that his responsibilities here should not be diminished by the Bill.

5.52 p.m.

Lord Monro of Langholm: My Lords, it is a privilege to follow my noble friend Lord Renton who has such knowledge of constitutional matters.

I have been listening to and reading all the debates in another place. It is obvious that many transitional problems will have to be faced over the next few years by the Scottish Office. It is up to us to correct as many errors and anomalies in the Bill as we can. I have to accept the referendum. But, like my noble friend Lord Campbell of Croy, I feel most strongly that it should have been held after the legislation was completed, and not before. I note with interest the result of the referendum. In Dumfries and Galloway--represented for many years by my noble friend Lord Lang, who made an excellent speech yesterday, and myself--it was a much closer call of 60:40. It was the only mainland region to vote against taxation. There was a similar trend in the Borders, with a much lower majority answering "yes" to each question. That shows the difficulties that we anticipate, being so near to the England/Scotland Border.

The referendum is now behind us and the Bill before us. It is up to us to improve the Bill and make it workable. I shall enthusiastically support the Conservative candidates for the Scottish parliament to ensure that Scotland has the best chance to remain within the United Kingdom. As many noble Lords have pointed out, the Government have run into all sorts of trouble. Labour thought that it would trump the Scottish National Party. It believed, too, that there would be a substantial majority in the parliament. It now looks as though it will be lucky to have a majority. Emotion and opinion polls can be dangerous, in particular if translated into a referendum.

Many speakers have stressed the fear of independence. Labour must realise that it is playing with fire over the next few years. My noble friend Lady Young spoke yesterday about the English backlash. That inevitably means in the long run the possibility of a move towards a federal state. That is something I do not want to see. There would be far too much bureaucracy within the current United Kingdom.

The Bill came late to this House. The Third Reading in another place was a month ago. I do not know why the government business managers have taken so long to bring the Bill to this Chamber. The delay, if any, has been with them rather than with the Opposition. The Committee in another place took place to an agreed timetable. However, many issues were not discussed, and more importantly, many questions were not answered. The noble and learned Lord the Lord

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Advocate is not now here: he has had a pained expression throughout some of the debates. The Minister has done much negative head nodding at the same time. That does not indicate the likelihood of a sympathetic reception of our forthcoming amendments.

However, we must not be criticised for carrying out our proper scrutiny when delay has been the Government's responsibility. I note that it is already building up in the media that the Bill will be delayed by your Lordships. That is not true. I am glad to hear from the Leader of the House that we shall have time to discuss the Bill in some detail.

I have some concern about the parliament itself. The problem of having only one chamber was raised by my noble friends Lord Lang and Lord Strathclyde yesterday. The noble Baroness, Lady Ramsay, spoke about it in her remarks earlier today. But this Chamber does a fine job of tidying up legislation. The fact that that opportunity will not be available in Scotland causes me a great deal of concern. I am also concerned about the exact role of the Secretary of State--perhaps it will emerge in Committee or today--his position in the Cabinet, his relationship with the Scottish parliament, and the importance that will have to the interrelationship between the government of the day at Westminster and the Scottish parliament.

The central belt will inevitably ensure that there will be a substantial number of socialist Members of the Scottish Parliament, given that the SNP, Labour and Liberal Members are basically all socialists at heart. I look with some degree of horror--this was emphasised in another place on Tuesday--at the standard of some Labour local councils in Scotland and the intolerable delay of the Secretary of State in calling them to order. We must expect something very much better from the Scottish parliament after it is elected. We want efficiency, vision and talent in the Scottish parliament. I am glad that the noble Lord, Lord Sewel, is a candidate; which will add to the possibility. But it is interesting to note how few current Labour Members of Parliament are standing. They would prefer a safe, easy life in Westminster, with constituency work carried out by the first and second class Scottish members of the Scottish parliament.

Nearly all Members who have spoken in the debate have highlighted the West Lothian question. The Bill cannot leave this House without some form of resolution. We cannot say, "It does not matter. It will resolve itself". It is an issue which has to be resolved. I hope that it will be taken seriously by the Government, and that they will not adopt their current attitude of simply walking away from the issue. At the same time it would be wrong if the Bill left this House without detailed debate on the future number of Scottish Members of Parliament at Westminster. I do not believe that it can be put off to the election after next, or to the one after that. It must be done at the next election. If we make a decision now, there is plenty of time for the Boundary Commission to resolve the issue of how to reduce the membership to 58 Members of Parliament at Westminster. We must follow that issue closely.

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We must also examine the reserved and devolved powers because some of the anomalies are extraordinary, particularly that on abortion. Apparently, the Scottish parliament will be able to discuss the death penalty or euthanasia, but not abortion. I found that an astonishing decision by the Government. There was a big debate in the other place and perhaps there was a misunderstanding over the whipping; most Labour Members thought that they were on a Government Whip, but it appeared that as it was a moral issue there was a free vote. The decision might have been different had they known that before they entered the Division Lobbies. I hope that we can resolve this important issue and because of that misunderstanding give the other place another chance to debate it.

Last night I followed the detailed arguments put forward by my noble friends Lord Lindsay and Lord Strathclyde relative to agriculture and fishing. I have represented the United Kingdom Government in Luxembourg and Brussels in fishing and agricultural debates and in the councils. We cannot leave the matter to a concordat, which seems to be a loosely worded agreement, to cover the question of where Scottish Ministers will be in relation to UK Ministers when we come to argue the case in Europe. That matter must be resolved before the Bill leaves this House.

I am pleased that at least we have Clause 100 which resolves the problems of the Border Esk and Tweed. For many years, I fought and argued over the friction on the Border Esk. The river mouth is in England, but 90 per cent. of the river is in Scotland. It came under the jurisdiction of the North-West Water Authority or the National Rivers Authority. I am grateful that that will now be carried further.

Finally, I wish to deal with the issue of taxation. We in Dumfries and Galloway, and those on the Scottish Borders, are concerned about the problems of where one lives, where one works and where one will be taxed. The game seems to be full of anomalies. A Scot working in England and travelling daily will be taxed in Scotland. If he works in England for the whole week and goes home at the weekends he will still be taxed in Scotland. If he lives in England and works in Scotland he will not be taxed there at all. There will be an immense problem for local employers on either side of the Border as regards the taxation system which will apply.

I have mentioned only a few of the anomalies, but there are many that we must resolve over the next few weeks. We have much to improve and much to elucidate in the Bill in order to achieve the future of Scotland within the United Kingdom.

6.3 p.m.

Lord Beloff: My Lords, noble Lords will be well aware that I am not a Scot. My connection with Scotland is in both senses of the word purely "academic". For that reason I have no particular personal concern with whether Scotland is well or ill governed. Therefore, I came to listen to the Second Reading of this Bill with an absolutely open mind. I must say that most of the

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speech of the noble Lord, Lord Sewel, almost convinced me that there was a much stronger case than I had thought for Scottish devolution.

Then, as so often is the case when one thinks one has seen the light, something happened. The noble Lord, Lord Sewel, having listed all the other intentions of the Government towards the constitution, went on to say:

    "These all demonstrate this Government's commitment to the modernisation of the United Kingdom. Our aim is a more pluralist, outward-looking democracy which is confident in itself and in tune with the modern world. We want to build a system of government which people can access easily, feel part of and take part in".--[Official Report, 17/6/98; col.1574.]

I do not for a moment believe that those words were written by the noble Lord, Lord Sewel. Obviously, someone who has held a professorship at a major Scottish university would never use the word "access" as a verb; nor would he indulge in the high-flown guff which characterises new Labour. We must assume that that paragraph did not appear in his original speech and was received by fax or pigeon post from Millbank Tower, having been composed by Mr. Alistair Campbell or someone of that kind.

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