A guest essay by Glyndwr Cennydd Jones
Following on from previous pieces titled ‘Towards Federalism and Beyond’ and ‘A Constitutional Continuum,’ in this essay Glyndwr balances the values of federalism and confederalism, exploring models between…
The United Kingdom (UK) is governed as a unitary state comprising England, Northern Ireland, Scotland and Wales, all of which are intrinsically linked culturally and historically in modern times through shared industrial, political and international experiences.
Devolution, as introduced in the late-1990s, aimed to address a measure of perceptible disenchantment across the isles due to unease with over-centralisation whilst retaining sovereignty in the hands of the Westminster parliament. Subsequent electoral majorities in Westminster, coalitions and the present supply and confidence agreement have challenged the governments in Belfast, Cardiff and Edinburgh with the twin prospects of constitutional uncertainty and political vulnerability. The latter specifically complicates power sharing at Stormont and generally raises questions about the fair distribution of funding. The finance secretaries of both Scotland and Wales wrote a letter to the UK Treasury in late-July 2017 stressing that the Barnett formula should apply to the one billion pounds of additional support now earmarked for Northern Ireland.
The extent of divergence in today’s UK is highlighted by the four nations’ differentiated politics, apprehensions about the Brexit negotiations, uncertainties regarding the post-EU Northern Ireland border, debates concerning a second Scottish independence referendum, and broad unease with the recent Wales Act. In March 2017, Professor Richard Rawlings observed in a BBC Radio Wales interview that the Act’s list of reserved powers, as retained by Westminster and Whitehall, is too extensive and potentially ‘claws back’ devolution in some fields.
Interestingly, the report titled Devolution and the Future of the Union (The Constitution Unit, University College London: April 2015) affirms that: ‘the UK is hardly unique in facing challenges to its structure and integrity…though it is unique in seeking to do so without a formal written constitution.’ This report explores three models of increasing devolution as possible solutions. Heftier doses of the same medicine may appeal as a remedy to some, but does not address the symptomatic ambiguity introduced by the general primacy of Westminster and the inherent challenges presented by the unitary state. The current situation is compounded by the disconcerting shadow of a potentially hard Brexit, enacted on all four nations, if the needs of all are not properly represented in negotiations.
Earlier this year, Lord Elystan Morgan that: ‘a good proportion of the reserved powers in the Wales Act 2017 reside at Brussels not Westminster.’ Former Prime Minister Gordon Brown and Baroness Randerson asserted that the UK should: ‘use the repatriation of powers from the EU to establish a new federal state of equals.’ Lord David Owen advocates a federal structure based on the German model in his paper titled A Federal UK Council (November 2016), whilst the report titled UK’s Changing Union, Towards a New Union (Wales Governance Centre, Cardiff University: February 2015) proposes a union state not a unitary state which: ‘consists of four national entities sharing sovereignty…and freely assenting to cooperate in a Union for their common good. This signals the end of devolution and a move to a more overtly federal or quasi-federal framework.’
goes further: ‘people often talk about federalism as if it were a solution for the UK. In truth the UK is already moving beyond it, to a more confederal solution.’(October 2016), Gallagher ‘a confederation of nations of radically different sizes, sharing things that matter hugely, like economic management, access to welfare services and defence.’ He explains that Brexit presents the: ‘UK’s first chance in decades of an effective regional economic policy, so that central government can direct resources to the poorer areas of the country and use them in imaginative ways.’
In a federation, sovereignty is shared between central and constituent nation governments. Each level has clearly articulated functions, with some powers pooled between them, but none has absolute authority over the others. Agreed practices and rules are confirmed through a written constitution with compliance enforced by a Supreme Court. In contrast, a confederation is a union of sovereign member nations that for reasons of efficiency and common security assign a portfolio of functions and powers by treaty to a central body.
Collective functions of a federation or confederation might typically encompass to varying degrees: the armed and security forces; border, diplomatic and international affairs; shared public services; cross-recognition of legal jurisdictions; currency and monetary policies; a single market; and select taxation, as appropriate. Federations generally have central institutions in place to implement many taxes (e.g. USA operates the Internal Revenue Service, the Alcohol and Tobacco Tax and Trade Bureau, and the US Customs and Border Protection), and foreign policy. Confederations raise collective budgetary funds annually through each member nation’s contributions of a defined proportion of their Gross Domestic Product (GDP). Internally, these nations operate distinct tax regimes and act unilaterally in most fields of foreign affairs and law, unless centrally assigned.
The report titled Federal Britain, The Case for Decentralisation (Institute of Economic Affairs: 2015) perceptively explains that: ‘fiscal decentralisation is associated with higher national income, better school performance and higher levels of investment. In particular, the decentralisation of revenue-raising powers has a stronger effect on performance than the decentralisation of spending. The evidence suggests that increasing the local share of taxation from 5% to 20%—still low by G7 standards—could raise GDP per capita by 6%. With especially low levels of revenue decentralisation, and as a large country, the UK is in a particularly good position to gain from transferring powers and revenue-raising.’ More research is required to better understand the probable medium to long term economic impacts on each nation of moving towards a federal or confederal model of governance.
In a federation, an individual is a citizen of the central overarching structure and the constituent nation within which they reside, participating democratically in electing representatives to the legislative parliaments at both levels of government. Typically, a party political system operates across the whole. In a confederation, individuals elect representatives to take part in central policy decision-making processes more in the role of trustees acting on behalf of their member nation’s interests. National parliaments, not individuals, are represented in the central institutions with citizens relating directly to their member nation and only indirectly to the confederation. For example, Article 8:1 of the mainly confederal Treaty of European Union states that: ‘every person holding the nationality of a member state shall be a citizen of the Union.’
Therefore, a federation sets out to provide constitutional clarity and stability across constituent nations with shared mechanisms in place for advancing joint interests and resolving disputes. It also capitalises on the potential for realising economies of scale in the delivery of a few centrally held key functions, which may allow for the proportional redistribution of joint prosperity generated through the federal capital, and a greater projection of political influence in attracting investment internationally. By comparison, a confederation presents to each member nation both the advantages and the challenges of acting as a sovereign state within an isles-wide alliance. A treaty on issues of shared concern aims to mitigate any risks associated with fragmenting previously delivered common functions. Competitive considerations have more prominence between member nations when negotiating within a confederal-type relationship, balanced against the consensus model largely offered by federalism, and the cost savings achieved through operating formal joint mechanisms across many key areas of governance are not secured to the same extent.
The constitutional choice may not be purely binary in nature. Professor John Kincaid, in his article titled Confederal Federalism and Citizen Representation in the European Union (Western European Politics, Volume 22: 1999 Issue 2), details: ‘what seems to have developed in the EU is...a confederal order of government that operates in a significantly federal mode within its spheres of competence.’ Member nations have delegated, in effect, parts of their sovereignty over time to central bodies which agree laws on their behalf. For example, the existence of an EU common currency within what is mainly a confederal treaty illustrates the point.
Reflecting on the varied politics across the four nations, the progressively sustainable model might well rest along the continuum between a Federation and a League or Union of the Isles in time (i.e. a confederation). In crude terms, the former option has aspects of a safety net deployed with many shared instruments of governance established to support the realisation of economies of scale, in delivery, and to address the common interests held by constituent nations. The latter option allows for agreement and partnership amongst fully empowered member nations on matters of collective concern, but with competitive considerations likely to complicate interactions between them. A League or Union of the Isles could invite participation by the Republic of Ireland if so desired, dealing neatly with the post-Brexit issue of the border with the north. It could also address the wishes of Scotland if independence is sought.
As well as those key common interests demanding some form of agreed centrally-held functions for defence, foreign affairs, finance and home affairs as already described, there are also many mutual considerations of a general nature which might require the establishment of other useful structures to promote cooperation and harmonisation of laws across the isles. These considerations include postal, telephonic and internet communications; railways, roads and associated licensing; airports, ports and traffic controls; coastguard and navigational services; energy, water and related infrastructure; income and corporation taxes; rates of sales, weights and measures; copyrights, patents and trademarks; scientific and technological research; broadcasting; meteorological and oceanographic forecasting; environmental and ecological protection; civil defence and emergencies; prevention of terrorism and serious crime. Such structures could be critical within a political climate where the EU can no longer be relied upon to promote the necessary collaborations and understandings.
The extent to which an incline towards federalism would support greater constitutional clarity, comfort and confidence should not be underestimated, especially on matters of defence, social mobility and trade. However, a tilt towards confederalism, with England established as one unit alongside Northern Ireland, Scotland and Wales could provide a solution to one of the more difficult issues presented by the federal-only solution. To quote Dr Andrew Blick from his web article titled Four Options for Configuring the British Constitution (London School of Economics and Political Science: February 2015): ‘the UK already has more diversity in certain respects than might be found even in a federation, for instance through the existence of three different legal systems…with a fourth possibly coming in Wales.’ Blick highlights that: ‘a practical problem involves how to incorporate England into a federal UK. If England were included as a single unit, since it accounts for more than 80% of the population, federalism might create instability worse than that which it sought to correct. Another approach could be for England to participate in a federation in a series of more manageably-sized regions. Yet it is not clear how to demarcate these territories, and whether they would command sufficient popular attachment to make the federal project politically viable. Nonetheless, a federal UK may become the most plausible means of preserving the UK, necessitating a resolution to this English dilemma.’ It should be noted that both constitutional models of federalism and confederalism allow for some further devolution of powers within England at a tier of governance immediately below that of National Parliament level.
In national terms, there is a clear distinction between the existentialist and utilitarian views of self-government. The former demands more autonomy simply because of a belief that it is the natural right for nations, and the latter considers it as a path to a better society—to achieve the most effective political unit for securing the economic growth and social justice that people deserve. A solution somewhere on the continuum between federalism and confederalism could encourage and support a real partnership of equals across these isles, sharing specific powers to address collective interests whilst valuing the autonomy of each nation. It could also promote many of the aspirational advantages sought for by self-government at the same time as ensuring confidence in the fields of diplomacy, economics and security which the current unitary state advocates.
So what might such a governance model look like?
A League or Union of the Isles would be established as a confederation of England, Northern Ireland, Scotland and Wales with aspects of federal-type control built into key policy portfolios to reflect the principles of equality and solidarity amid member nations. The Head of the Confederation could continue to be Her Majesty and successors. Each nation would hold every power and right which were not by treaty, or constitution, delegated to joint institutions, operating distinct legal jurisdictions. Such a jurisdiction in Wales would be subject to formation by the National Parliament in Cardiff.
A Council of the Isles would be introduced with mechanisms created to address the asymmetry between the population sizes of member nations, particularly through the composition and distribution of seats. Members of the Council would be elected for a four-year period, potentially through the political party-list approach of proportional representation by the electors of each nation, convening annually for a fixed period unless urgent business is demanded. The Council would assume its own standing orders, confirming a Presiding Officer and Executive whose Prime Minister and Ministers would be responsible for enacting legislative power throughout the isles on matters involving defence, foreign affairs, finance, home affairs and mutual cooperation (as defined by treaty or constitution).
Each Bill considered by the Council could be usefully circulated to the National Parliaments of England, Northern Ireland, Scotland and Wales in advance of final reading, with member nations empowered to make representations, as necessary, to affirm objections or suggest amendments before voting. On passing, the Head of State would confirm the Bill as an Act of the Council of the Isles. Lord Owen has proposed (2016): ‘until a Federal UK Council is well established I suggest retaining a non-elected House of Lords to scrutinise the legislation that does not concern federal interests.’ Similarly, Professor Gallagher has stated (2016) that: ‘the House of Lords’ might be used ‘as an effective Senate…of the Isles, holding the UK’s governments to account for their joint activities.’ He evokes: ‘a grand committee of the House...with no partisan majority, and with 55% English members so the devolved are consciously overrepresented.’ The ultimate authority on all questions regarding the legitimacy of any law and treaty would remain with the Supreme Court.
A Congress of Member Nations, comprising the Council’s Prime Minister and Minister for Home Affairs, as well as the First Minister of each member nation, would convene regularly to discuss those general and mutual considerations which demand a degree of cooperation and harmonisation of laws as outlined earlier, besides the key centrally held functions. The Congress, with support of the Council, could also hold controls for confirming contractual-type arrangements for the supply of additional public services to member nations if requested. To cover the common functions and other agreements in place, the Council would levy charges upon each member nation according to a defined proportion of their GDP annually relative to that of the confederation as a whole. These monies would be paid into a consolidated fund from which the interest on the UK public debt would continue as a standing charge. The Council, working with the Congress, should aim to promote equality in sharing a measure of the baseline investment for infrastructure projects across the isles. In the interests of advancing ongoing solidarity and mitigating elements of financial risk, it might also be desirable to assign some central responsibility for pensions alongside federal-type mechanisms for collecting what is presently termed National Insurance Contributions appropriately renamed.
The National Parliament of each member nation would sit as the legislative and representative body of its people, enacting powers and laws on every issue that is not identified as the Council’s sole competence. A Government with executive powers would be appointed from the nation’s parliamentary members, comprising a First Minster and other ministerial positions as required to oversee the various offices. The superior judges in each member nation would be nominated on the advice of an independent authority with established institutions in place to scrutinise public appointments, including auditor general, and to operate as an ombudsman. Nations could further sub-divide their lands through Acts of National Parliament, defining the composition and responsibilities of local government authorities.
Is there a detectable appetite in England, Scotland and Wales for exploring a journey towards federalism and beyond?
The report titled A Constitutional Crossroads, Ways Forward for the United Kingdom (The Bingham Centre for the Rule of Law: May 2015) does indeed propose: ‘moving towards a more federal, codified constitutional arrangement for the UK,’ as it would: ‘establish permanent devolution on the basis of more clearly defined principles and rules.’ Also, th report is due to be published in Autumn 2017.
The Constitutional Commission in Scotland, from which several of the institutional ideas explored in the paragraphs above are inspired, goes further in its web-article titled A Confederal UK? (2015). This suggests that a confederal-type arrangement: ‘would enable Westminster to continue as the Parliament of England, while a limited range of confederal powers—relating to the Crown, defence, foreign policy, currency, passports, and a few incidentals—would be vested in a new Confederal Assembly. Each state would be able to adopt its own institutions within a broad constitutional framework that would secure fundamental rights and help protect the integrity of political processes.’ Intriguingly, a confederal response to the constitutional question could be to the advantage of England and Scotland more than Northern Ireland and Wales, whose less affluent regions might benefit from the greater support made available through a federal arrangement.
Speaking from a Wales perspective, Gwynoro Jones (2017), an experienced political commentator on matters of devolution, has gone on the record as saying that ‘the Welsh Assembly has been hamstrung from the beginning and has been devoid of the freedom to act with effective powers. I do not blame Nicola Sturgeon for re-opening the conversation on support for independence in Scotland, nor Gordon Brown for suggesting a federal solution for Scotland in the UK. With the Brexit result I believe that the future lies, at the very least, in a self-governing Wales within a federal UK.’
Greater fiscal devolution does, of course, present challenges, opportunities and risks. In the medium to long term, much depends on how a more influential Welsh government and an informed public respond to financial empowerment over time. Questions also remain on how the present significant deficit in Wales could be supported during transition whether through adjustment of the block grant, substantially restructured budgeting and judiciously strategic borrowing, or a combination of these approaches. In this regards, the report titled UK’s Changing Union, Towards a New Union (Wales Governance Centre, Cardiff University: February 2015) advocates a: ‘system for determining the fair distribution and redistribution of financial resources on a clear statutory basis...designed to be equitable between all parties on the basis of examination of needs and with no expectation that transfers would be continued when needs had been met satisfactorily.’
Anyone who has read the report titled Government Expenditure and Revenue Wales (Wales Governance Centre, Cardiff University: April 2016) must concede that something of a fundamentally structural nature should be done to stimulate the Welsh economy, so as to encourage entrepreneurship internally and investment externally through capable and confident institutions which are focused and motivated on supporting businesses and creating employment opportunities. There are indeed examples of hitherto financially challenged nations which on establishing greater autonomy, within the last two decades or so, are now bearing the fruits of their ambitions, innovations and labours, having admittedly experienced difficulties at the outset.
‘federalism appears to be a way out of the intractable, binary divisions that are fracturing the UK and its constituent nations.’ There is a: ‘need to shift away from a winner-takes-all mentality and to focus instead on healing divides through strategic compromise. A federal or confederal solution that works for the overwhelming majority, rather than a marginal one, seems to be an effective way to achieve this. It is up to the UK government and its constituent nations to gather the will to work for such a compromise.’
As with most things in life, he or she who pays the piper does inevitably have first choice of tune, or at least in convening an agenda for a much needed Constitutional Convention…