Options for an English Parliament: policy powers and financial arrangements

Ongoing Constitution Unit research is exploring options for an English Parliament. Two of the most fundamental questions concern what policy powers such a body would have and financial arrangements. Jack Sheldon suggests that an English Parliament would be likely to have policy and fiscal powers resembling those of the Scottish Parliament, and that a new funding formula would be required to cover the costs of devolved services. These developments would have major implications not only for England but also for the other parts of the UK.

Since last autumn Professor Meg Russell and I have been working on a research project exploring the options for an English Parliament. Although there have been various calls over the last 20 years to establish such a body, how might it actually work in practice? Two of the most fundamental questions, which have major implications for other aspects of institutional design, concern what policy powers an English Parliament would have and what kind of financial arrangements would be possible. This blog post focuses on these questions.

What English Parliament supporters have said

English Parliament supporters emphasise restoring equality among the UK’s nations, in light of what they see as the unfairness of present devolution arrangements. It is thus unsurprising that they have often set the powers of the Scottish Parliament as a benchmark. The Campaign for an English Parliament (CEP) state prominently on their website that they campaign for an institution ‘with powers at least as great as those of Scotland’. This demand has been echoed by MPs who are in favour, including David Davis, Frank Field and John Redwood. In the aftermath of the Scottish independence referendum Redwood wrote that ‘As we seek to put into legislation what Gordon Brown called Home Rule for Scotland we must do the same for England’.

To the extent that they have addressed finance, advocates of an English Parliament have focused on criticism of the Barnett Formula, which provides more generous per capita government spending in Scotland than in England. Eddie Bone of the CEP has linked the continued use of the formula to ‘closures of A&E departments and council services across England’. Frank Field has likewise been highly critical of the formula, saying that ‘it is totally unacceptable that the poor in [his] constituency should be less well supported than the poor in Scottish constituencies’. Proponents have said less about what sort of financial arrangements they envisage following an English Parliament’s establishment.

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Three monkeys on the back of English fiscal devolution

The fiscal powers of English local authorities are extremely limited. In recent years there have been many proposals for significant fiscal devolution to take place, but little progress has been made on this agenda. In this post Mark Sandford argues that there are three fundamental reasons for this: the nature of the UK state, the complexity involved and equity considerations.

The mid-2010s have seen an unprecedented number of proposals for devolution of fiscal powers to local authorities in England. The coalition government’s ‘devolution deal’ policy, together with the substantial fiscal devolution granted to Scotland in the wake of the 2014 independence referendum, have encouraged many stakeholders to believe that English local government is on the cusp of a breakthrough in the balance of revenue-raising power between local and central government (Morrin and Blond 2015; Centre for Cities 2015). Some have produced reports containing substantial proposals for fiscal devolution to English local authorities (Centre for Cities 2015; ICLGF 2015; ICLGFW 2016; London Finance Commission 2017; EEF 2017). Associated concepts such as place-based budgets, raising borrowing caps, commercial councils and local government restructuring have also attracted attention as potential solutions to English local government’s financial challenges.

I suggest that these hopes and plans arise from an over-optimistic reading of the political landscape. Most of the key drivers of the apparent ‘devolutionary turn’ in England are ephemeral and highly dependent on ‘constitutional entrepreneurs’ and windows of opportunity. Developments in Scotland, Northern Ireland and Wales are matters of high politics. English devolution deals and the retention of business rates by local authorities were largely driven by former Chancellor George Osborne. Inertia and Brexit will drag hugely on all policy innovations in the 2017–22 parliament. The confusion of local administrative boundaries, public bodies and contested local identities have long frustrated strategic approaches to local governance in England.

But this type of political headwind is priced in by commentators. There are three more fundamental reasons why fiscal devolution in England was always likely to face insurmountable obstacles, which relate to the nature of the UK state, the complexity of the change implied, and to local equity. These have been largely lost in the warm glow of consensual causes such as inclusive growth and regional prosperity. They run beneath the day-to-day debate on policy solutions, and offer a more cultural account of the critical relationships at issue.

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Northern Ireland talks: is a deal in prospect?

Northern Ireland remains without a government. Dialogue has resumed, but the climate is conflictual, and exacerbated by Brexit. The foundations of the Good Friday Agreement may now be seriously shaken. There is some talk of a deal being in prospect, but room for doubt that anything lasting can be achieved. Alan Whysall provides an update and suggests that handling of Northern Ireland once again needs the priority, care, understanding and courage it received from previous governments.

My previous blog set the scene: two polarising elections – to the Northern Ireland Assembly and then Westminster – have failed so far to restore devolved government, following its collapse at the beginning of the year; rather, they reinforced the position of the two big parties, the DUP and Sinn Féin, at the expense of moderates. The nationalist vote, which had been shrinking, has bounced back, which along with the prospect of Brexit has renewed the focus of Irish nationalism on unity. Since Sinn Féin do not take their seats in the Commons and the SDLP no longer has any seats, it is now without any nationalist voice.

Where are we now?

At Westminster, following the election, the Conservative party and DUP reached a confidence and supply agreement. The DUP will support the government throughout this parliament on votes on confidence and finance, as well as Brexit and national security. However, the DUP are to ‘have no involvement in the UK government’s role in political talks in Northern Ireland’. The government will provide extra funding for Northern Ireland totalling about £1 billion over the coming years. It seems to be linking the extra spending to resumed devolution, the DUP denying such a linkage. The deal has been much criticised, Moody’s citing it among reasons for downgrading the UK’s debt rating. Gina Miller and others are mounting a legal challenge, with unclear prospects of success.

Meanwhile the civil service in Northern Ireland, with no ministers to give it direction, aims to ensure ’business as usual‘, but is unable to launch significant new programmes, projects or policies. No budget has been set for this year. The Secretary of State has laid down ‘indicative’ allocations, presumably by way of giving political cover, since he does not have legal authority of any kind over the devolved domain.

According to the Secretary of State, if the situation ‘is not resolved within a relatively short number of weeks will require greater political decision-making from Westminster… to begin with legislation [for] a Budget”.

In that context, he would consider whether Assembly members should still be paid, since they do not meet – one of the few levers the government really has. The DUP leader Arlene Foster, though, found this offensive. Is this a veto?

The Secretary of State spoke of a ‘glidepath’ to greater UK government intervention, implying perhaps, though he did not use the term, a reversion to direct rule, the classic regime of which was considered in an earlier blog.

Strains are emerging between the British and Irish governments over this: after the Irish foreign minister Simon Coveney said there could be no British-only direct rule, the British government sharply riposted that there would be no joint authority, which Coveney had not suggested. Some saw the hand of the DUP here. Under the Good Friday Agreement, the minister is right – Dublin would have substantial rights to make representations about British government actions during direct rule, though without prejudice to sovereignty.

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The Citizens’ Assembly on Brexit: how did it work?

The conclusions reached by the Citizens’ Assembly on Brexit, composed of a politically and demographically representative group of 50 members of the public, were reported on this blog yesterday. In this post the Assembly’s Design and Facilitation Lead Sarah Allan tells the story of how the Assembly’s two weekends worked. 

Last weekend saw the finale of the Citizens’ Assembly on Brexit (CAB) and the announcement of its results. By its end, 50 members of the public – broadly representative of the UK population in terms of age, sex, ethnicity, social class, where they lived, and how they voted in last year’s referendum – had spent around twenty-eight hours considering what the UK’s trade and immigration policy should be post-Brexit.

The Assembly demonstrated not only that citizens can have a detailed and constructive conversation about options for Brexit, but also that they can enjoy doing it. Assembly members rated the Assembly an average of 5.5 out of 6 across the two weekends, with 86% of Assembly members saying they ‘strongly agreed’ with the statement ‘Assemblies like this should be used more often to inform government decision-making.’ A further 8% ‘agreed’.

So how did the Assembly work? This post tells the story of its two weekends.

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Citizens’ Assembly on Brexit: results and initial reflections

The Citizens’ Assembly on Brexit reached its climax yesterday. After two weekends of intense deliberation, the members voted on a range of options for the form they want Brexit to take in relation to trade and immigration. Their conclusions will surprise some, and they deserve detailed attention from politicians and commentators. Assembly Director Alan Renwick summarises these conclusions and reflects on the weekend as a whole. He argues that, while the Brexit debate is often presented in stark binary terms, the Citizens’ Assembly suggests that the British public are capable of much subtler thinking – if only they are given the chance.

In my last post on the Citizens’ Assembly on Brexit, I reported on a hugely successful first weekend of deliberations. In advance, we had, through stratified random selection, recruited a group of Assembly members who reflected the composition of the UK electorate in terms of age, sex, ethnicity, social class, where they lived, and how they voted in last year’s referendum (25 voted Leave, 22 voted Remain, and three did not vote). We had also developed a programme and set of briefing papers that had been vetted by our advisory board, comprising supporters of both sides in the referendum, as well as experts in balanced communication. At the first weekend itself, remarkably, every Assembly member attended. They showed immense dedication, working long hours as they reflected on their own views, discussed ideas with fellow members, listened to experts, and quizzed those experts in depth. The experts presented diverse perspectives, some emphasising the benefits of single market membership or immigration, while others pointed out the costs of high immigration or argued for the advantages of cutting free from the single market and customs union. Our team of professional facilitators from Involve did a superb job of guiding proceedings and keeping the discussions on track.

This time I can report on an equally successful second – and final – weekend. Attendance was again astonishingly high: every member but one (who was ill) returned. Once again, all (and I do mean all) were tremendously focused and limitlessly good humoured. Members naturally did not always share each other’s views, but they listened and spoke respectfully and genuinely. Our facilitation and support teams were again inspirational. It was a privilege to be there.

While the first weekend focused on learning, the second was all about deliberation and decision-making. We began on Friday evening with short talks and Q&A sessions with two prominent politicians: Graham Brady MP, chair of the Conservative backbench 1922 Committee, spoke for leaving the single market and customs union; Labour MP Kate Green advocated the opposite. Thereafter, there were no more external speakers. The weekend was devoted to the Assembly members, who reflected on what they wanted post-Brexit policy-making to achieve and then on which policy options they wanted the government to pursue.

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A reset of intergovernmental relations on Brexit is needed to break the deadlock over the EU Withdrawal Bill

The EU Withdrawal Bill has exacerbated the already serious tensions between the UK and the devolved governments over Brexit. Akash Paun argues that the underlying problem is a lack of trust between the governments, and that to break the deadlock there must be a revival of intergovernmental mechanisms and compromise on all sides.

The EU Withdrawal Bill will take the UK out of the European Union while providing that all European law be imported into domestic law to avoid a regulatory black hole after Brexit.

The bill creates wide-ranging powers for ministers to amend this huge body of ‘retained EU law’ to ensure it will be ‘operable’ outside the EU and to reflect the terms of the withdrawal agreement.

In Edinburgh and Cardiff, there are serious concerns about the impact of the bill on devolution and on the balance of power within the UK. The Scottish and Welsh Governments have announced that they oppose granting the bill devolved consent, which Whitehall recognises should be sought under the Sewel convention.

The EU Withdrawal Bill sets a default that EU powers return to Westminster

The central point of contention is clause 11. At present, the devolved parliaments cannot pass legislation that is incompatible with EU law. Clause 11 replaces this constraint with a new provision preventing them modifying the new category of ‘retained EU law’.

This means all powers currently exercised at EU level will initially flow back to Westminster. There is further provision for some of these powers to be ‘released’ to the devolved level, but at the discretion of UK ministers.

The Whitehall view is that new frameworks will be required to coordinate policy currently held constant across the UK by EU law in areas such as environmental regulation, agricultural policy, state aid and aspects of justice and transport.

These frameworks might be needed to prevent new barriers to economic activity within the UK, to ensure the UK can strike comprehensive trade deals, to comply with international obligations or to manage common resources such as fisheries.

A long list of policy domains where EU and devolved powers intersect has been published. For Scotland there are 111 areas mentioned. But the extent to which new frameworks will be needed is unclear.

This is partly because the terms of exiting the EU remain unknown and if the UK remains within some EU frameworks, the devolution question will be (largely) moot. But it is also because the government failed to think through these complex questions before triggering Article 50 and is now in a race against the clock.

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