THE REFORMED UNION THE UK AS A FEDERATION by David Melding The Reformed Union The UK as a Federation by David Melding The Institute of Welsh A!airs exists to promote quality research and informed debate a!ecting the cultural, social, political and economic well being of Wales. The IWA is an independent organisation owing no allegiance to any political or economic interest group. Our only interest is in seeing Wales flourish as a country in which to work and live. We are funded by a range of organisations and individuals, including the Esmée Fairbairn Foundation, and the Waterloo Foundation. For more information about the Institute, its publications, and how to join, either as an individual or corporate supporter, contact: IWA – Institute of Welsh A!airs 4 Cathedral Road, Cardi! CF11 9LJ tel: 029 2066 0820 fax: 029 2023 3741 email: [email protected] www.iwa.org.uk www.clickonwales.org September 2013 ISBN 978 1 904773 69 6 To Peter and Isabel Buckingham David Melding is Conservative AM for South Wales Central and Deputy Presiding O"cer in the National Assembly. First elected in 1999 he has been the Welsh Conservative Group’s Director of Policy and also Shadow Minister for Economic Development. During his Assembly career he has chaired several committees including Audit, Health and Social Services, and Standards of Conduct. Despite voting ‘No’ in the 1997 referendum on devolution, David Melding has since argued strongly for a federal British constitution. Contents Acknowledgements 04 18 September 2014 - Forethought 06 CHAPTER 1 The passing of the old Union 09 CHAPTER 2 The Union’s one foundation: Parliamentary sovereignty 20 CHAPTER 3 Towards a new Union: the political fabric of a UK Federation 35 CHAPTER 4 Small worlds in a global economy: fiscal federalism and the art of economic decentralisation 49 CHAPTER 5 Unionism and nationalism: a meeting point in federalism 75 CHAPTER 6 A Constitutional Convention as a path to a new Union 99 18 September 2014 – Afterword 110 INDEX 113 Acknowledgements First and foremost I thank my personal assistant Sarah Sharpe for her untiring work on the manuscript. Without Sarah’s cheerful encouragement and support this book could not have been written. Once again John Osmond has been the most thoughtful of editors and I have greatly enjoyed our discussions on Welsh and British politics. Many people were kind enough to post comments on the IWA’s website where an early version of each chapter first appeared. I found this process stimulating and rewarding. Finally, I am greatly indebted to many friends who have read various parts of the text and responded generously with comments and advice. Greg Walker and Lee Waters read the whole text and their insight and challenge strengthened this book decisively. A Note on the Nation As the UK is a multi-national state, references to national governments in this text mean the governments of Scotland, Wales, and Northern Ireland (England is yet to join the party). Occasionally I also use the term substate governments to refer to the UKs national tier. 04 05 18 September 2014 – Forethought The people of Scotland will determine their own constitutional future and that of the whole British people on 18 September 2014. This constitutes a fiduciary duty of the highest order. While there is little doubt that Scotland could sustain the weight and cost of a state apparatus, Wales and Northern Ireland would have little choice but to remain in a reduced and perhaps dysfunctional Union with England. Even finding a plausible name for that state formerly known as the United Kingdom of Great Britain and Northern Ireland might prove di"cult (some have mischievously suggested ‘Little Britain’, others ‘Great England’). More ominously, the peace process in Northern Ireland would be further tested by any fundamental reconfiguration of the UK. It is surprising that the referendum on Scottish independence, so far at least, has been portrayed as a question of simple and contained national self-determination. Britain’s tolerance of secession is exceptional in the international community, but it is yet to be balanced by an adequate sense of fiduciary duty. This imperative to consider Scottish independence in an international context also involves the whole British people. Unionists must make any counter o!er to Scottish independence clear, at least in its essentials, and do so well before the commencement of the o"cial referendum campaign. The Scottish referendum will be the most critical decision on state formation since the Supreme Court of Canada’s judgement in August 1998 on the permissibility of a Québec secession. The Court ruled that Québec could not secede simply as a result of a referendum vote in favour of independence. It further held that the right to Britain’s tolerance of secession is exceptional in the international community, but it is yet to be balanced by an adequate sense of fiduciary duty. national self-determination in international law only permitted secession for a people su!ering oppressive subjugation. Nevertheless, the Court did rule that a referendum in favour of independence would generate an obligation for the rest of Canada to negotiate with Quebec. There was, to summarise, neither an absolute right to secede nor an 06 absolute denial of such a right. As Peter H. Russell has written: “ In going where no high court in a constitutional democracy has gone before – namely to the legal rules governing secession – it was also a landmark decision for worldwide constitutionalism”.1 Should the people of Scotland vote for independence it would set a dramatic precedent. It would promulgate the principle that nations and states are ideally coterminous and multi-national states are something of a compromise because the potential for national flourishing within them is limited. That indeed would be a ‘landmark decision for worldwide constitutionalism’. The international community is now starting to make its voice heard on the issue of secession. It is likely that the Spanish government speaks for several EU states when it asserts that Catalan independence “would require a large majority in the Spanish parliament, new elections and further approval in a referendum held throughout the country”.2 In the USA some key opinion formers are anxious about the implications of Scottish independence. As an editorial in the Washington Post put it: “ An independent Scotland would significantly weaken the foremost military and diplomatic ally of the US, while creating another European mini-state unable to contribute meaningfully to global security”.3 The former prime minister of Canada, Jean Chrétien, has challenged the very validity of referendums to determine such vast constitutional questions, “I lose my country because somebody loses their glasses on the day and doesn’t vote? I have a problem with that”. He made these comments on a recent visit to the Scottish O"ce in London4. If a multi-national state cannot endure in Britain, where can it prosper? These misgivings and anxieties should not surprise us. The demise of the UK would strike a far heavier blow against the concept of multi-national states than the dissolution of the Soviet Union or Yugoslavia. Britain is the world’s oldest liberal democracy and has set the benchmark for much constitutional practice in the English-speaking world and indeed beyond. If a multi-national state cannot endure in Britain, where can it prosper? Some political philosophers believe that there is a strong ethical argument against unfettered national self-determination within liberal multi-national states. Nationalists in such states should seek to fulfil legitimate nation-building goals within the multi- 07 national union. The federalist thinker Wayne Norman argues that there are compelling “ …reasons for seeking out federal solutions to the problems of multi-national states. The world surely has little to gain from being divided into 600 states (with 600 tetchy armies and who knows how many ethnic and religious militias), and still less from going through the ‘liberating’ process (Yugoslav- style) of fighting to become 600 states.”5 Even if we consider these thoughts over anxious, they should remind us that the referendum on 18 September 2014 will be no ordinary political moment. Although no guns will blaze, its impact on unionism and the coherence of multi-national states could be greater than any event since the American Civil War. The di!erent visions Scottish Nationalists and British Unionists have for political life after the referendum must be shaped in the long shadow of this fiduciary duty. References 1. Peter H. Russell, Constitutional Odyssey, p. 245, 2004. 2. A letter from the Spanish Ambassador, Mr Federico Trillo-Figueroa, published in the Financial Times, 8 November 2012. 3. Washington Post, 30 October 2012. 4. Financial Times, 17 May 2013. 5. Wayne Norman, ‘Towards a Philosophy of Federalism’ in Judith Baker (Ed.) Group Rights (Toronto, p.82, 1994. 08 Chapter 1 The passing of the old Union On the 5 May 2011 the Union received an electoral shock greater than any it had experienced since 1918 when republican Sinn Fein defeated the more polite Irish Nationalist Party. Sinn Fein’s victory soon ended the forced Union of 1801; the SNP’s triumph at the polls threatens the more willing Union of 1707. Ireland was always a restless partner, but should Scotland reassert her political independence, the Union would be null and void. The consequences for Wales, Northern Ireland, and of course England, would be profound. Those unionists who casually assume that an independence referendum cannot be won should remember that prior to 2011 few thought the SNP capable of winning a majority in the Scottish Parliament. So far the debate about the future of the Union has focused almost entirely on Scotland.