Progressive government and the next challenge for devolution

Much to applaud one month in

ONE EVENING at the beginning of March 1992 a politician delivered a lecture that began with a plea for radical constitutional reform. The opening message was a call to arms: the individual was under assault from the “vested interests of the state”. The notion of community needed to be wrested from “the narrow notion of the state”. But the speaker wasn’t a libertarian declaring war on the state. It was Gordon Brown, delivering the Charter 88 lecture on the constitutional future of Britain.

1992 seems like ancient history in political terms. Wales has certainly moved on since then. We have the National Assembly, the Assembly Government and a burgeoning body of Welsh law and policy. But there has been only partial reform and we need to move on again. The premise of devolution is secure but the promise is yet to be realised. David Cameron is unequivocal that there will be settlement of the National Assembly powers question through a referendum. UK reforms will have an impact on Wales, including fixed term parliaments and a reformed House of Lords – both sensible – and voting reform, which is worth further exploration.

Staggering challenges remain. Wales has the highest unemployment rate of any UK nation. 96,000 of our children live in severe poverty. Our homegrown business birth rate is among the lowest in the UK. Even before the recession Wales was struggling with economic inactivity and tens of thousands of young people not in education, employment and training. Our poorest areas are among the UK’s poorest. And our public services still need vast improvements to catch up with UK standards.

The Liberal Conservative coalition is already accelerating the move away from the old, sterile positions in the debate about the state, the individual and society. During and after the General Election, Labour in particular reverted to the comfort blanket of the past, with warnings about plots to cut the state to ribbons. Ossified sections of the Labour party tried to smear the Liberal Democrats as traitors to ‘the progressive cause’ and complicit in the plot. This is an outdated – and presumptuous – belief that does not reflect reality.

The question is no longer whether the state is a force for good or bad. It can discharge both roles quite equally and adequately. The call to develop society – ‘the Big Society’ – is a positive declaration of the value of family to rely on, friends to depend on, community to call on, neighbourhood to grow in, faith to share in and charity to work together with.

The urgent need for the most radical change to our constitution remains. But that’s why I am optimistic about the Liberal Conservative Government. The guiding principles of the governing parties’ manifestos are two sides of the same coin. As the Liberal Democrat manifesto said:

“At the root of Britain’s problems today is the failure to distribute power fairly between people.”

Likewise the Conservative manifesto said:

“Real change comes when the people are inspired and mobilised, when millions of us are fired up to play a part in the nation’s future…But in the end all the Acts of Parliament, all the new measures, all the new policy initiatives, are just politicians’ words without you and your involvement.”

Together these are a call for active citizens and public reasoning.

The UK coalition has already begun to deliver. The coalition is delivering on transparency. More detail about public sector remuneration will be published online. The Treasury database was published online for the first time this month, which gave greater detail about Assembly Government spending than the Assembly Government has ever made available itself. I urge Carwyn Jones to adopt this spirit of open government.

Cheryl Gillan and David Cameron have also been completely open about the timetable for the referendum. The route map is clear: by following Electoral Commission guidance, that safeguards the legitimacy of the process, the referendum will probably take place in early 2011.

The coalition is delivering on liberty. Labour’s measures have not helped to reduce violent crime in particular over the past decade. ID cards have been scrapped. The retention of DNA samples from people who are innocent – an affront to the principles and practice of British justice – will end. Incidentally, Charter 88 – the hosts of the Gordon Brown lecture – demanded a British Bill of Rights, which David Cameron would like to deliver.

The coalition is delivering on welfare. Labour seemed content to sweep long-term unemployment under the carpet once Frank Field – as Labour’s Welfare Minister early on – had set out the implications of tackling it. Wales has had the highest proportion of out-of-work benefits claimants consistently over the past decade. Frank Field is now leading a review for the coalition into poverty.

It is close to a century since large portions of south Wales were designated ‘special areas’ by the UK Government. Labour was not ambitious enough. The welfare programme under Labour defined a sustainable job as one that lasted for seven months. The New Deal for Young People, on which the Young Person’s Guarantee and Future Jobs Fund were modelled – placed only one in four UK participants into work in August 2009, according to UK Government figures.

The coalition has published plans for targeted, swifter help for those in need on welfare and reasonable sanctions for the minority who can work but refuse. Providers will be rewarded for real results, not for shoving people out of the door for a few months. These are not policies designed to save money but to empower and to tackle the tragic – and immoral – waste of human potential.

The coalition is delivering on the economy. There’s no money left – as Liam Byrne, the former Chief Secretary to the Treasury – candidly admitted. The facts are stark and unavoidable. The UK is spending £156bn more than it takes in revenue every year. National debt is £893bn according to the ONS. The interest on this debt every year is three times the annual Welsh budget. What a legacy to leave our children when they grow up! In April 2010 alone the UK Government debt increased by £330m every day. The UK coalition is right to say this will be dealt with immediately.

Wales is being asked to save a little under £1 in every £100 it spends, the same as Scotland, and much less than the government departments that have been asked to save this year. There will be corresponding measures to kick-start the economy in Wales and the UK. Bank lending to businesses will restart. Unemployed people with the potential to start businesses will be given extra help. Labour’s jobs tax on businesses will be stopped. And the UK coalition will reform taxation to help low and middle income earners. Wales will benefit most as the income tax allowance is raised towards the £10,000 target identified by the Liberal Conservative coalition.

As for the immediate position, the offer from the UK Government is clear: devolution is respected and this year’s cuts can be approached flexibly. Yet, depending on when Carwyn Jones was asked, the prospect of delay “offers nothing to the people of Wales,” is “not quite as attractive as it sounds” or, in fact most recently, is “very useful”. Jane Hutt’s inability to say the Assembly Government made contingency plans for this year’s budget was shocking. Despite all their rhetoric about cuts, the governing parties in Wales have contrived to do nothing to prepare for the present. Attention will turn increasingly – and quite appropriately – to the Assembly Government’s handling of the budget. This is to be welcomed as devolution in action.

The coalition is delivering on funding reform. Depending on the outcome of the forthcoming referendum, the Liberal Conservative Government will establish a process similar to the Calman Commission for Wales. The Holtham Commission raised valid and useful points that the UK Government recognises. Scotland’s political and financial settlements, made under Labour, are different. The Scottish Parliament was very obviously given more extensive responsibilities; all powers were treated as devolved unless specifically reserved. The Scottish Government was given authority to vary basic income tax by 3p in the pound. A Calman process for Wales will look at responsibility, not just funding reform. We must settle the political accountability question in Wales – the responsibility issue – before turning to the funding question. This is an open and unambiguous roadmap to progress the Welsh financial settlement.

These will be unprecedented times for Welsh politics. I welcome the progressive consensus at the heart of the UK Government. Devolution will flourish over the next few years. But we must also move away from the ‘narrow notion of the state’, to embrace reform that is more radical and more ambitious and that ultimately makes Wales a better nation in which to live and work.

When we look back on the formation of the coalition government I suspect we will see it as a turning point, a watershed in British politics and an event of immense importance which is not immediately apparent. Here is a chance for a moderate, reforming government to make far-reaching economic, constitutional and social changes that demand action and, hopefully, redraw the map of British politics for generations to come.