John Osmond argues that Wales has been left behind in the Scottish debate on independence.
Conflicted views in Wales about the Scottish referendum were perfectly encapsulated by First Minister Carwyn Jones’ response to George Osborne’s belated promise of Devo Max if there is a No vote next Thursday. “Whatever further devolution is offered to Scotland must also be offered to Wales and Northern Ireland,” he announced on twitter.
However, he immediately followed that up with the qualification that full control of income tax – something the Conservatives and Liberal Democrats want to give the Scottish Parliament if there is a No vote – would definitely not be in Wales’ interests.
George Osborne’s intervention was, of course, in response to the first poll of the campaign suggesting a narrow lead for the Yes camp, something which would be Labour’s worst nightmare, particularly in Wales.
For the brutal fact confronting all Welsh politicians, of whatever colour, is that under current funding arrangements Wales, unlike Scotland, is heavily subsidised by England. In broad terms total public expenditure in Wales, whether by Whitehall or the Welsh Government in Cardiff Bay, is of the order of £30 billion, of which only about £18 billion is raised within Wales. The balance, around £12 billion, comes in a subsidy – what the economists deftly call a fiscal transfer – from the rest of the UK (mainly England) to Wales.
This is why independence is not on the Welsh agenda in remotely the same way as it is in Scotland. It is also why Carwyn Jones felt obliged to provide the following nuanced qualification to his initially bold stance in demanding for Wales whatever was being offered to No voting Scots:
“We must be wary of taking new powers that carry a significant cost without a transfer of resources. The method and structure of devolution should be the same across the UK, even if the devolved powers may be different. We need to assess carefully what is in Wales’ best interest. Devolution of welfare and full income tax devolution would not be.”
But for Wales, just as for England and Northern Ireland, the even remote possibility that Scotland might vote Yes has changed the political dynamic. For the moment at least constitutional change is on the agenda in a way it hasn’t been since the referendum that established the National Assembly seventeen years ago, in September 1997. Wall to wall coverage in the press and on television has forced it on a reluctant Welsh consciousness.
Playing catchup the Welsh population, who normally pay little if any attention to politics in Cardiff Bay, are scratching their heads and wondering, often out loud around the dinner table, what all this might mean for us.
The main conclusion of a seminar held on the topic by the Institute of Welsh Affairs in Cardiff Bay last Thursday was that the leadership in the National Assembly has failed to articulate a strong enough view of what it wants from the next stage of devolution. Certainly it is failing to utter loud enough to be heard in the present debate, let alone to be taken seriously.
One of the problems was that, given the lack of coherence amongst the Conservative, Plaid Cymru and Liberal Democrat opposition parties, the minority Welsh Labour Government was not being held to account. Professor Laura McAllister, of Liverpool University, said, “We need a more mature political scene. In Scotland the SNP reinvented itself to become a realistic party of government. In Wales we don’t have serious competition. Our politics are infantile.”
Gerry Holtham, until recently an economics adviser to the Welsh Government and formerly chair of the acclaimed Commission on Funding and Finance Commission for Wales which pointed out the extent to which Whitehall treats Wales unfairly compared with Scotland, concurred. “We’re a non story,” he said. “We’ve nothing interesting to say. All we have to say is ‘Give us more money’. My advice is tend the garden. Improve policy outcomes with the instruments we’ve got. Then we would be more persuasive. We have to raise our game.”
There was a general assumption that despite the apparent movement towards the Yes campaign in Scotland there would still be a narrow No vote. This was accompanied by a view that this would be followed by a minority Labour or Labour-Liberal Democrat coalition at Westminster at the general election next May.
In these circumstances the extent to which any Devo Max proposals were kept on the agenda would depend on the SNPs success at the 2015 Westminster election and even more at the Holyrood election in 2016. If an SNP government were returned in 2016, as was thought likely, this would be seen as a mandate for a re-run of an independence referendum before 2020.
The main challenge for Wales would be ensuring that Welsh interests were included and embraced in whatever changes were made to the devolution settlement in Scotland in the meantime. There was much discussion, for example, of how Wales might take advantage of any Constitutional Convention that might emerge following a No vote. What pressure could be brought to ensure that this applied to the whole of the UK and not just Scotland?
All this was the comfort zone preoccupations of what has become known as the Cardiff Bay bubble. Little attention was given to the consequences for Wales of a Yes vote next week. If this happens real thinking will begin the morning after.