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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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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Labour’s unavoidable English question

In 2015, the Conservative government implemented ‘English votes for English laws’ (or EVEL) in the House of Commons as a way of responding to the ‘English question’. Labour, by contrast, has had relatively little to say in this area – but were the party to form a government in the near future, it would be required to take some tough decisions. In this post, Michael Kenny assesses the possible routes forward for how Labour might respond to EVEL, in particular, and broader questions about English governance and devolution across the UK.

Brexit and its potential implications saturate British politics. But attention has lately shifted away from some of the complex constitutional questions which were aired in the days and months before the UK’s negotiations with the EU began. These include the thorny issue of how the UK government will handle the very different perspectives on Brexit which are held by the governments of Northern Ireland, Scotland and Wales – which will move back to the foreground when the government formally requests the consent of the Scottish and Welsh parliaments for the European Union (Withdrawal) Bill currently passing through the Westminster parliament. Whether Labour in Wales and Scotland opt to oppose Brexit will be of particular importance in political terms.

A related, but distinct, issue which all of the main parties will have to consider soon is how those parts of the complex body of coming legislation which affect England in distinct ways, will fare. And this in a context where it is still taken as given, in Westminster at least, that the UK government can represent the interests of the entire UK and England at the same time, even when the current administration depends for its survival upon a small party that is based in Northern Ireland only.

The previous Conservative government introduced a complex and convoluted system – known as ‘English Votes for English Laws’ (or EVEL) – to handle such legislation, and sought to make political capital out of its ability to answer the English question – one of the great Cinderella issues of British politics.

Whether these opaque rules will be enough to deal with the increasingly political character of English national identity is a moot point. But in EVEL and the patchwork model of metro mayors and newly created combined authorities it has created, the government at least has something to say on the subject of English devolution (even if what Theresa May herself thinks about these changes remains a well-kept secret).

Labour, in contrast, seems to have little to say in this area – aside from promising a constitutional convention which feels like a fig leaf, rather than a signal of intent.

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The European Union (Withdrawal) Bill: legal implications for devolution

The European Union (Withdrawal) Bill will begin its second reading in the House of Commons today. In this post Stephen Tierney considers the bill’s legal implications for devolution, noting that as currently drafted it will be almost impossible to articulate the boundaries of devolved competence once the Act has come into force.

The European Union (Withdrawal) Bill (‘the bill’), introduced into parliament on 13 July, will begin its second reading in the Commons today. Already constitutional problems are piling up, not least a potential impasse with the devolved legislatures. The bill has been called ‘a naked power-grab’ and ‘an attack on the founding principles of devolution’ in a joint statement by the First Ministers of Scotland and Wales. They also made clear that they will not recommend legislative consent for the bill as it stands. Michael Keating has addressed the policy implications of the bill on this blog. In light of discussions with UK and devolved parliamentary committees and other policy-makers over the summer, this post will consider the legal implications of the bill for the territorial constitution, in particular the changes it makes to devolved competence and the ramifications of the enormous secondary powers given to UK ministers.

The bill (clauses 10 and 11), makes provision for devolution, amending the Scotland Act 1998, the Government of Wales Act 2006 and the Northern Ireland Act 1998 in order to circumscribe closely the exercise of devolved powers in relation to the UK’s withdrawal from the EU. These provisions need to be read in light of two other sets of provisions within the bill. Those which seek to convert EU law into domestic law (clauses 2-6); and those which give powers to UK ministers and to the devolved administrations inter alia to change ‘retained EU law’ and to give effect to the withdrawal agreement by way of secondary powers (clauses 7-9).

Altering competence

All of this requires some brief contextualisation. The bill will of course repeal the European Communities Act 1972 (‘the ECA’) and end the supremacy of EU law across the UK. But in doing so, it will not expunge the vast body of EU law from the statute book. Instead it converts EU law as it exists at the moment of the UK’s withdrawal into domestic law; creating the new category of ‘retained EU law’. The competence of the devolved legislatures will upon passage of the Withdrawal Bill be redrawn by this category of ‘retained EU law’. Clause 11, in amending the three main devolution statutes, in effect puts ‘retained EU law’ beyond the competence of the Scottish Parliament, National Assembly for Wales and Northern Ireland Assembly. For example, the existing provision in the Scotland Act 1998 (s.29(2)(d)) that denies the Scottish Parliament competence to legislate incompatibly with EU law, is replaced with an equivalent restriction in relation to ‘retained EU law’.

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The electoral system for an English Parliament: options and implications

Ongoing Constitution Unit research is exploring options for an English Parliament. One essential question for such a body is the choice of electoral system. In this post Jack Sheldon and Meg Russell focus on the possible implications of using FPTP as compared to using AMS or another proportional system. They conclude that the choice of system would have substantial effects on an English Parliament’s likely political dynamics.

Since last autumn we 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? One question that would need to be addressed is the choice of electoral system. In this post we focus on the possible implications of alternative systems.

Models for an English Parliament and likely electoral systems

Our research has identified two primary models for an English Parliament. Some proponents, including Conservative MPs John Redwood and Andrew Rosindell, want a ‘dual mandate’ body, whereby members of the UK House of Commons sitting for English constituencies would meet as the English Parliament on certain days. This clearly implies that members of the English Parliament would be chosen by first past the post (FPTP), at least so long as it continues to be used for UK general elections.

The alternative model is for a separately-elected English Parliament, equivalent to the existing devolved legislatures elsewhere in the UK. Proponents of this kind of change have generally said little about the choice of electoral system. FPTP has not been used for any new institutions in recent years and so a proportional system is more likely. AMS is used in both Scotland and Wales, and given these precedents it seems the most likely system to be adopted. A major part of the rationale for establishing an English Parliament is to bring more coherence and symmetry to the UK’s constitutional arrangements. UKIP’s 2017 election manifesto, which included a proposal for a separately-elected English Parliament, explicitly suggested that an English Parliament should be elected under AMS, while in correspondence  with the authors senior Campaign for an English Parliament figures have stated that ‘the electoral systems for all the devolved administrations should be the same’.

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