Silk Commission Speech

I am very grateful, Mr Deputy Speaker. I have curtailed my speech a fair bit because of the time constraints, but I am not too upset because most of it was trailed in The Western Mailthis morning. I have no idea how it got there, but perhaps it was lucky that it did.

This is a timely debate and I congratulate the Secretary of State on securing this time on the Floor of the House, because the nature of the British state is clearly changing. The strength of the yes vote in March has given huge momentum to the growth of the political autonomy of our country. Events in Scotland, with the historic victory of the Scottish National party in May, mean that there will be a referendum in the next three or four years on independence for Scotland. I am not a betting man, but I know where I would put my money if I was. There will be serious repercussions for the British state. We know that it will be a multi-option referendum. Even if the SNP does not win the referendum, and I am increasingly convinced that it will, there will be a devolution-max settlement.

There is currently a dual process on the funding of Wales with the Silk commission and the bilateral negotiations on the reform of the funding formula. It is important that we have progress on the latter as we discuss the former, and that the debate is as open as possible. Three parties are included in the debate on the important issue of Barnett reform: the Labour party, which leads the Welsh Government, and the Lib Dems and the Conservatives, who lead the UK Government. We have been excluded. The information on that debate needs to be open and we need to hear about its progress before we start talking about the fiscal measures that the Silk commission will address.

My party fully agrees with the points made by the Secretary of State and Tory Back Benchers about accountability. Before I came to this place, I served as a town councillor in Carmarthen. We were responsible only for very local matters, but we had taxation powers. For the life of me I cannot understand why anybody would oppose giving the Government of Wales similar powers, as this would, not least, focus the minds of Assembly Members on wealth generation, which is very important. If we are serious about creating a more prosperous and just society, we have to focus on wealth generation, as do the Welsh Government. Giving them tax-raising powers would make them focus more on such issues and on some of the give-away processes that we are seeing at the moment.

Taxation powers and borrowing go hand in hand, and I am grateful that the Silk commission will be able to look at borrowing powers. In a situation where we will have a varying income stream as a result of having taxation powers, borrowing is the best measure for smoothing out those differences, and it is right and proper that the Welsh Government will be able to have those powers if the commission so recommends.

We know that there are two phases to the commission, the first of which will examine taxation powers. We have been scouring the world for best practice in federal states, and I do not think that there is anything new about what is on the agenda. There are many examples from across the world that we could use to best effect in Wales. Any submission that my party gives will be a compromise, because clearly our policy is for the devolution of all taxation matters ultimately. However, we will be trying to engage with this process constructively and we hope that parties from across the spectrum will engage in the same manner.

The second phase of the commission will examine further areas of power. The Parliamentary Voting System and Constituencies Act 2011 has given added momentum to this, because we know that we will lose a quarter of our Members of Parliament. Unless further areas of power are devolved to the Assembly there will be a democratic deficit, because there will be fewer Members scrutinising decisions made on Wales. We argued during consideration of that Bill, with those on the Labour Benches, that it was not proper to cut the number of Welsh seats based on the referendum result. All the referendum did was enshrine sovereignty over current devolved matters. I still hope that Lib Dem colleagues might rebel when the matter comes back to the House and I might be able to keep the constituency of Carmarthen East and Dinefwr. If not, and if my fantastic constituency and the fantastic constituency of Arfon disappear into the annals of history, further fields of power need to be devolved to the Assembly to avoid that democratic deficit.

My last point relates back to my intervention on the Secretary of State. I was grateful to receive a very detailed response, as I did not think I would. If there is a consensus on the commission between the political
parties and among civil society, there needs to be a clear process map to make the recommendations become law.

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